In a joint statement on Thursday, the Financial Services Council (FSC), Responsible Investment Association Australasia (RIAA), and 10 other finance groups expressed their support for Australia’s bipartisan commitment to the Paris Agreement and urged all levels of government to support the net zero transition.
“Acting to limit climate change and its impacts makes good financial sense,” the group said, highlighting data from global central banks that found an orderly transition to net zero by 2050 could result in global gross domestic product being 7 percent higher than under current policies.
Separate research estimated an even higher global gross domestic product (GDP) benefit of up to 25 per cent by mid-century, and 50 per cent by 2090 on the basis of continued climate efforts.
“Globally, the past 10 years were the 10 hottest on record. The physical effects of climate change are already evident here and around the world, underscoring the urgency of action,” the statement continued.
While the industry groups expressed optimism on Australia’s progress and response to climate issues, they highlighted a need for the country to “harness our advantages”, including “our endowment of mineral and renewable resources”.
“Australia’s business and finance sectors are pressing ahead with the task of managing climate risks, planning for new opportunities and investing for the future. But the private sector cannot act alone,” the group said.
Highlighting the extent of global investments in the net zero transition, which hit US$2.1 trillion last year – exceeding Australia’s GDP by 20 per cent – the group stressed that to stay competitive for capital, Australia needs a credible net zero plan, an ambitious 2035 emissions target and strong policies to attract investments.
“Australia has established solid policy foundations, including the Safeguard Mechanism, climate-related disclosures, plans for adaptation and resilience, and policies to steadily and responsibly decarbonise our energy sources.
“Maintaining these policies – while evolving them to be as efficient and competitive as possible – will give business and finance the confidence to invest here for the long term, supporting a strong economy and a better future for all Australians,” the group said.
According to data, global investment in sources of clean energy is now nearly double that in fossil fuels, while renewable energy powered 91 per cent of new global electricity capacity in 2023.
Alongside the FSC and RIAA, other signatories included:
- Ai Group
- Australian Sustainable Finance Institute
- Chartered Accountants Australia and New Zealand
- Clean Energy Investor Group
- CPA Australia
- Governance Institute of Australia
- Institute of Public Accountants
- Investor Group on Climate Change
- Principles for Responsible Investment
- Property Council of Australia
