Many Australian companies will scale back climate action as economy slows, survey finds | greenhouse gas emissions

Australian companies are more likely to scale back their efforts to cut carbon emissions when the economy slows than their global peers, according to a survey of 700 companies in 14 countries.

However, Deloitte’s measure of private companies with annual sales between $250 million and $10 billion ($366 million to $14.6 billion) also found that about two-thirds of the 50 Australian executives surveyed support new regulations and crackdowns advocate so-called greenwashing. both higher than the global average.

The 2022 climate check, conducted just ahead of last month’s Cop27 climate change conference in Egypt, also preceded the release of Australia’s latest greenhouse gas data, which showed the country’s emissions were nearly unchanged in the year to June. Pollution amounted to an estimated 486.9 Mt CO2 equivalent, 0.1% or 0.4 Mt CO2-e more than last year.

A 3.7 percent reduction in emissions from the electricity sector as renewables expanded their share was offset by rising pollution from the oil, gas and agriculture sectors, the government said last week.

Although Australia is still falling short of the Albanian government’s legal target of cutting emissions by 43% from 2005 levels by 2030, many Australian companies would scale back their own climate action because of higher inflation or other economic problems.

One in five Australian companies surveyed by Deloitte said they “will need to significantly scale back our efforts over the next 12 months,” compared to the global average of 12%. Another 12% said they would “temporarily” halt these efforts – with a goal of resuming them in a year – compared to 8% overall.

Still, 42% of Australians expect to accelerate their sustainability actions in the coming year, slightly above the global average of 37%.

While the IMF and others forecast Australia’s economy to perform relatively well in 2023 and beyond, the country’s greater reliance on fossil fuels than some of the other 13 nations surveyed meant the decarbonization task “is much harder for us,” Pradeep Philip, Head of Deloitte Access Economics, said.

When asked to what extent their business could continue to grow while reducing emissions, around one in ten Australian executives strongly agreed it could be done, compared to one in four globally. The “agreed” response was about 50% for both.

Companies that didn’t act still faced financial risk, as outlined in Australia’s Prudential Regulation Authority’s latest climate vulnerability assessment last week, Philip said.

“Inertia is not an option – standing still is going backwards,” he said. “The factors causing this energy crisis won’t last forever – but when it comes to emission reductions, we cannot sit on our hands and wait for the economy to improve. There’s no time for that.”

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Internationally, nearly two-thirds of executives said greenwashing or making false claims about climate efforts should be cracked down on. Australians polled agreed slightly higher at 68%, with 60% saying the problem had become “serious” in their own industry.

Partly to curb such harassment and accelerate decarbonization, most companies advocated more regulation—contrary to their usual dislike.

Globally, 55% of leaders said governments could encourage companies to address climate change by implementing “new regulations and policies,” while just over half called for a carbon tax, Philip said. Among Australian peers, the proportion wanting more regulation was higher at 64%, with support for a carbon tax not much below average at 46%.

Despite Australia’s challenges in weaning the nation off fossil fuels, leaders aligned closely with their international peers in forecasting long-term benefits if they did so. About 92% either “agree” or “strongly agree” with such expectations, compared with 87% for the global average, according to the survey.