Qantas Airways Limited

Identification and time horizons (p. 11). The Group identified a long list of physical and transition risks and opportunities from external data, stakeholder feedback and industry benchmarks, then evaluated them in internal workshops and with third-party scenario analysis tools. Short, medium and long term mean up to 2030, 2030–2040 and 2040–2050. The short term aligns to the internal planning cycle and interim targets; the medium and long term align to fleet planning and the net zero by 2050 target.

The physical risks are classed as long term for their expected strategic and financial significance, although acute weather disruption is likely across all time horizons (pp. 12–13). The opportunity is the fleet renewal program, a pre-existing strategic initiative (p. 11).

Business model and value chain (pp. 7–8). Principal activities are international and domestic air transportation, freight services and a frequent flyer loyalty program; customers are transported using two brands, Qantas and Jetstar. The value chain runs from upstream suppliers (aircraft and parts, fuel including Sustainable Aviation Fuel (SAF), goods for distribution) through direct operations to downstream customers (destination tourism, loyalty, investments). Most emissions come from flying-related operations.

Effects (pp. 11–17). The Group says climate change has affected, and will continue to affect, its business model and value chain. Physical risks may disrupt schedules, restrict payload, raise maintenance and insurance costs, and damage third-party airport infrastructure and supply chains (pp. 12–13). Transition risks may raise SAF and carbon credit costs, delay access to lower-emission aircraft and fuels, and influence customer preferences, procurement decisions and investment appetite (pp. 15–17).

Concentration (pp. 11, 14). Physical impacts appear concentrated in northern and tropical Australia and tropical Asia; flooding is the most significant modeled hazard; domestic operations show the greatest modeled exposure. 60% of the net book value of total assets is vulnerable to physical risks, mostly aircraft and aircraft parts. Aviation is a hard-to-abate sector facing increasing carbon regulation, technological advancements and stakeholder scrutiny.

Climate transition plan (pp. 9–10). The climate transition plan is aligned to the net zero by 2050 target and the interim targets of a 25% reduction in net Scope 1 and 2 emissions by 2030 (from 2019 levels) and Sustainable Aviation Fuel (SAF) equal to 10% of jet fuel consumption by 2030. Three pillars sit under a mitigation hierarchy: fleet and operational improvements, SAF, and carbon markets. With SAF not yet available at scale, carbon credits currently represent the largest component of the pathway to the interim net target; because fleet renewal, operational efficiency and SAF cannot eliminate all gross emissions, credits are expected to play a significant and enduring role and targets are set on a net basis. Fleet renewal replaces the legacy fleet over the next decade (p. 21). Activities are resourced through existing expenditure and capital allocation frameworks, and the Chief Sustainability Officer leads oversight and execution (p. 10).

Assumptions and dependencies (p. 37). By pillar for 2030 and 2050, for example airspace collaboration and aircraft entering service in line with the fleet plan, supportive SAF policy and global supply growth, and robust compliance carbon markets. If not realized as expected, the cost, pace or feasibility of the plan may be affected.

Resourcing (p. 19). The $400 million Qantas Climate Fund, established in 2023 with Airbus, deployed $36 million in 2025/26; the Group and Airbus have together committed $126 million.

Physical risks (p. 14). No material financial effects from physical climate events were identified in the 2026 Consolidated Financial Statements or 12-month projections. Anticipated effects are not quantified: the Group judges the measurement uncertainty too wide for the results to be meaningful or useful. It lists the income statement lines (including passenger and freight revenue, fuel and insurance costs) and balance sheet items (impairments to property, plant and equipment and right-of-use assets) that may be affected.

Transition risks (pp. 18–20). Effects are quantified through two cost pathways, carbon credits and the Sustainable Aviation Fuel (SAF) price premium, because individual risk drivers cannot be costed separately.

Costs sit in the 'Fuel' line of the Consolidated Income Statement, before mitigation; net exposure is expected to be materially lower. Carbon and SAF costs beyond 2026/27 are judged not practicable to estimate and too uncertain to be useful. Capital deployed in 2025/26 through the Climate Fund: $36 million (p. 19).

Fleet renewal opportunity (p. 21). Not quantified: the Group relies on the exemption for commercially sensitive information and says the benefits cannot be isolated from wider commercial outcomes.

Resilience assessment (p. 22). The Group assessed its resilience across three global emissions scenarios over the short (to 2030), medium (2030 to 2040) and long term (2040 to 2050). The assessment supports continued execution of the current strategy and does not indicate a need for fundamental change to the business model. Capacity to adapt rests on the mobility of the aircraft fleet, the Financial Framework (access to capital and flexibility in capital allocation), continued investment in fleet and operational improvements, Sustainable Aviation Fuel (SAF) and carbon markets. Within the scenarios' assumptions and limitations, the Group is well-positioned to manage physical and transition risks. Uncertainties include temperature patterns, extreme weather, carbon pricing, interest rates and SAF cost and availability (pp. 22, 39).

How the analysis was done (pp. 38–39). Analyses were run in 2024 and the current period, with a refresh at least every five years. Transition risks were assessed for the Qantas Group, physical risks for the aviation segments. The scenarios use IPCC SSP1-2.6 (low emissions, Paris-aligned), SSP2-4.5 (moderate) and SSP5-8.5 (high), with inputs from the International Energy Agency, Bloomberg New Energy Finance 2050 Outlook and Air Transport Action Group Waypoint. By 2050: population 8.5, 9.1 and 8.6 billion; GDP: USD$291, $231 and $365 trillion. The fleet renewal opportunity has not been the subject of scenario analysis (p. 11).