This week we saw a crescendo of Australian business support for climate change action. The Business Council of Australia proposed strong emissions cuts. News Corporation launched a campaign to support a target of net zero by 2050. The Australian Financial Review ran a climate summit. Long-time climate action supporters, Andrew Forrest and Mike Cannon-Brookes, made big promises to further invest in green technology.
It is great to see Australian business stepping up to the climate challenge. he environmental, social, and corporate governance website Purpose Bureau shows that more than 700 of the largest Australian companies have now committed to reduce their emissions to zero by at least 2050. The challenge now is to turn words into actions – – and there’s a long way to go.
Groundbreaking data released today shows that Australia’s major companies are much further ahead on commitments than on concrete emissions reduction. This data, from Accenture, calculates the “emissions rate” (greenhouse gases per dollar of revenue) for major companies around the world. It then matches each company’s emissions rate to the International Energy Agency’s emissions-reduction pathways for its industry. The best companies emit at a level consistent with a pathway to a 1.5 degrees global temperature increase, and the worst companies’ emissions are consistent with a pathway to dangerous warming above 3 degrees.
Some Australian companies are at world’s best practice. Medibank, Macquarie, Commonwealth Bank, Cochlear and Brambles are just some of the companies that have emissions per dollar of revenue consistent with the IEA pathway to 1.5 degrees or lower. But, overall, only 24 per cent of Australia’s largest listed companies have emissions consistent with keeping global warming below 1.5 degrees. This compares with 61 per cent of major companies in Britain and 53 per cent in Europe.
In other words, three-quarters of Australian companies currently emit at a rate that would lead to temperature increases above 1.5 degrees. And more than a third have emission consistent with a pathway to dangerous levels of warming above 3 degrees.
The worst-performing industries in Australia are mining, energy and consumer services, in which more than half of companies have emissions consistent with a pathway to dangerous levels of warming at 3 degrees or higher.
This data highlights the importance of scrutinising the recent climate commitments made by Australian businesses. Not all commitments are equal. Some represent strong credible action, and some are PR spin or “greenwashing”.
The most credible climate commitments are those that include deep long-term emissions cuts as well as concrete short-term action. For example, Woolworths has committed to net zero emissions by 2050, but also committed to strong intermediate goals to be achieved much sooner. Similarly, Coles and Telstra have committed to a short-term target of 100 per cent renewable electricity by 2025 on their pathway to net zero by mid-century.