Australian businesses are more likely to wind back efforts to cut carbon emissions when the economy slows than their global counterparts, a survey of 700 firms in 14 nations has found.
However, Deloitte’s gauge of private companies with annual turnover of between $US250m-$US10bn ($A366m-$A14.6bn) also found about two-thirds of the 50 Australian executives surveyed supported new regulations and a crackdown on so-called greenwashing, both higher than the global average.
The 2022 Climate Check, taken just prior to last month’s Cop27 climate conference in Egypt, also preceded the release of Australia’s latest greenhouse gas data that showed the nation’s emissions were almost flat in the year to June. Pollution totalled an estimated 486.9Mt CO2-equivalent, 0.1% or 0.4Mt CO2-e higher than a year earlier.
A 3.7% reduction in emissions from the electricity sector as renewables expanded their share was nullified by increases in pollution from the oil, gas and farming sectors, the government said last week.
Despite Australia still falling short of the Albanese government’s legislated goal of cutting 2005-level emissions 43% by 2030, many Australian businesses would scale back climate action of their own because of higher inflation or other economic woes.
One in five of the Australian firms surveyed by Deloitte said they “will have to cut back on our efforts significantly over the next 12 months”, compared with the average of 12% across the globe. Another 12% said they would “temporarily” discontinue those efforts – with an aim of resuming them in a year – compared with 8% overall.
Still, 42% of the Australians survey expected to accelerate their sustainability action over the coming year, or slightly above the 37% global average.
While Australia’s economy is forecast by the IMF and others to perform relatively well in 2023 and beyond, the country’s greater dependence on fossil fuels than some of the other 13 nations surveyed meant the decarbonisation task “is much harder for us”, Pradeep Philip, head of Deloitte Access Economics, said.
Asked to what extent their company could continue to grow while reducing emissions, about one in 10 Australian executives strongly agreed they could, compared with one in four globally. The “agreed” answer was about 50% for both.
Companies that didn’t act still faced financial risks, as detailed last week in the latest climate vulnerability assessment from the Australian Prudential Regulation Authority, Philip said.
“Inertia is not an option – standing still means you’re going backwards,” he said. “The factors causing this energy crisis won’t last for ever – but when it comes to emissions reductions, we can’t sit on our hands and wait for the economy to improve. There’s no time.”
Internationally, almost two-thirds of executives said there should be a crackdown on greenwashing, or making false claims about climate efforts. Australians surveyed agreed at a slightly higher rate, at 68%, with 60% saying the issue had become “serious” in their own industries.
In part to curb such chicanery as well as accelerate decarbonisation, most businesses were in favour of more regulation – contrary to their usual aversion.
Globally, 55% of executives said governments could encourage business to address climate change by implementing “new regulation and policies” while just over half wanted a carbon tax, Philip said. Among Australian counterparts, the share wanting more regulation was higher at 64%,with support for a carbon tax not much lower than the average at 46%.
Despite Australia’s challenges at weaning the nation off fossil fuels, executives were closely aligned with their international counterparts in forecasting long-term benefits if they did. Some 92% either “agreed” or “strongly agreed” with such expectations, compared with 87% for the global average, the survey found.
