The Australian Council of Superannuation investors (ACSI) welcomes the Federal Government’s announcement establishing a National Net Zero Authority to oversee an orderly transition to a low carbon economy.
To avoid further delay to the transition and if Australia’s net zero ambition is to be achieved, the communities and workforces disproportionately affected by the move away from fossil fuels must be supported.
The legislated Net Zero Authority will have powers to coordinate with communities and help investors and companies to engage in net zero transformation opportunities.
“The transition to a low carbon economy is the most significant transformation of our economy since the Industrial Revolution. It will take leadership from Government, in collaboration with workers, First Nations peoples, communities, business and investors, to ensure that this transformation is a just one, leaving no community or workforce behind,” said Louise Davidson, ACSI CEO.
“Investors have long been concerned about the risks of a disorderly transition and ACSI has previously called for an independent national authority to drive the transition.”
As universal owners of capital, institutional investors cannot fully diversify away from the impacts of a poorly managed transition and have an important role to play in supporting a just and equitable transition.
But to feel a level of confidence about how the economy is tracking through the transition, investors also need transparent monitoring and reporting from both listed companies and Government. The Federal Government and transition authorities should set clear targets and objectives, monitor their progress against these targets and report regularly and transparently.
“The Net Zero Authority will play a critical role in helping companies and investors to more confidently deploy vital, long-term and patient capital in the net zero economic transformation,” Ms Davidson said.
“International examples illustrate that a lack of coordination leads to poor outcomes for affected communities, workers and economic activity more broadly. A coordinated approach driven by the Net Zero Authority will help not only meet the challenges of the transition head on, but take advantage of its opportunities for the benefit of all Australians.”