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When it comes to the benefits of sustainability, companies put brand recognition and customer satisfaction behind addressing climate change.
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Australian businesses lag in global environmental push
19 January 2023
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9 minute read
Australian businesses have fallen behind the rest of the world when it comes to the focus on environmental sustainability with only 37 per cent of firms ranking climate change as one of the most pressing issues they face compared to 42 per cent globally.
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While 79 per cent of Australian business leaders believed economic growth could be achieved by reaching climate change goals, only 56 per cent expected climate change to impact their company’s strategy over the next three years compared to 61 per cent of global firms, according to the Deloitte 2023 CxO Sustainability Report.
It found only 68 per cent of Australian organisations increased their sustainability investments over the past year against 75 per cent of global firms.
Head of Deloitte Access Economics Dr Pradeep Philip said organisations were seeing a shift from voluntary action on climate to mandated change by increasing regulations.
“The recent proposed change to the safeguard mechanism and emissions targets for big polluters show the regulatory environment is changing,” said Dr Philip.
“This trend is likely to continue marking the end of the age of voluntary action and the beginning of a new period of mandatory transition.”
“This year’s report also highlights the broadening drivers for change — employees, customers, investors, shareholders, and regulators — for executives and organisations in Australia and around the world. But there is more to do and the pressures to invest in sustainability will only continue to grow.”
The survey revealed how Australian businesses viewed the benefits of their sustainability efforts.
Addressing climate change ranked fifth, behind increased brand recognition and reputation, employee morale and wellbeing, innovation around offerings and operations, and customer satisfaction.
“While executives are united on some of the key benefits of climate action such as brand recognition, employee engagement and positively impacting a shared world crisis, only 31 per cent cited investor returns as a key benefit of accelerated climate action,” Dr Philip said.
“Done right, rapid decarbonisation presents the single biggest growth opportunity for Australian business and we expect to see this recognition shift as fast movers take the benefit of stakeholder demand for action.”
Deloitte’s report found that the top three obstacles to increasing sustainability efforts were difficulty measuring environmental impact, at 23 per cent, the cost of green efforts being too great at 21 per cent, and the magnitude of change required was too large at 19 per cent.
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