Download the full submission here.
The Investor Group for Climate Change (IGCC) and the Responsible Investment Association Australasia (RIAA) made a joint submission to the Climate Change Authority (CCA) to strongly support the development of a robust, publicly accessible progress-tracking Platform and commend the CCA for initiating this work at an important moment in Australia's climate transition
As peak bodies that represent institutional investors and other finance sector stakeholders, who must act in the best financial interests of their beneficiaries, our interest is in strengthening governance underpinning climate action in Australia, including effective monitoring of progress and feedback loops informing policy development.
While the government’s sector decarbonisation plans and National Adaptation Plan and National Climate Risk Assessment are positive steps towards a resilient, net-zero economy, they have been less useful in identifying how much and when climate-aligned investment is required. These documents lack short- and medium-term decarbonisation and adaptation goals and milestones, and don’t provide investment roadmaps across key sectors.
When investors are making capital allocation decisions, they are assessing the current state of the market and making assumptions about how government policy will impact their potential investment. This Evidence Platform can provide information to market that will help investors make better-informed investment decisions, linking policy, targets, gaps and opportunities.
Our submission focuses on design principles and metrics. Getting the foundational framework right should be the primary focus for CCA at this early stage of work.
General recommendations
- Prioritise defining an enduring Platform structure and purpose, with coverage across the whole economy, rather than immediate data availability.
- Ensure flexibility to accommodate data on relevant non-climate sustainability areas.
- Realign financial metrics towards corporate transition activity.
- Create a Platform that aligns metrics with established government policy and investor frameworks – including the Sustainable Finance Taxonomy.
- Use data from climate-related financial disclosures to inform the Platform.
- Avoid conflating all climate-aligned investment with renewable energy investment.
- Ensure framing questions and metrics are outcomes-focused rather than progress-focused.
- Consider physical risks to the financial system outside of insurance-related impacts.
‘Download submission’ for full joint submission.
