Post on 31-May-2015
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Deakin University November 18th, 2011:
New Frontiers in Sustainable Governance
Matthew Tukaki, CEO
The Sustain Group
www.sustaingroup.netwww.sustaingroup.net
- What’s happening across business and industry in Australia?
- What’s happening in New Zealand
- What’s with the political narrative?
- Some of the underlying key challenges business face
- The global challenge: “sealing a deal”
- The opportunities
Themes…
www.sustaingroup.netwww.sustaingroup.net
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We conduct carbon footprint analysis using the input-output method and the processes / tools first championed by the University of Sydney We work with organisations with diverse supply chains, both at home and abroad We run education briefing programs: in 2012 we will be launching several certificate and diploma level programs in partnership with an institution We have a sustainability employment and skills development division We also operate a “boots on the ground program” reviewing supply chains in foreign countries and conduct research into the business response to climate change
We operate across 13 jurisdictions
www.sustaingroup.netwww.sustaingroup.net
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The worlds largest corporate citizenship initiative with more than 6,000 global signatories
Signatories in Australia include Westpac, Woolworths, Nestle, Treasury Wine Estates, Rio Tinto, BHP, the ANZ, the National, KPMG, Allen’s Arthur Robinson, xStrata, St James Ethics Centre, Griffith Univeristy
Recently with the Minister of Justice I announced the formation of a UNGCNA Leadership Group on Anti-Corruption and in February of 2012 we will establish a specific Leadership Group for the Environment
2012 will be a significant year in global public policy for climate change
www.sustaingroup.netwww.sustaingroup.net
Carb
on
Pri
cin
g
Bra
nd
ing
Cash flow
Increased compliance
Hig
h w
ag
e
dem
an
d
Global Economy
US Job Numbers
GreeceUS Unemployment
The
Pric
e of
Iro
n O
re
The Chinese EconomyG
illard’s polling
Staff well being
Sale
s perf
orm
ance
Skills demand
To grow or not to grow
Interest rates
Inflation
Tax
Cost controls
Buyer
behavio
ur
The Board
Governance
Japans recovery
Demographics
Execu
tive loss
Climate change
Corruption
Competitors
Partners
Suppliers
The Banks
Early election
Coa
litio
n po
licie
s
Reven
ue d
iversity Payroll tax
Productivity
Leadership
YouTube
Social Media
Trade Barriers
Tw
itte
r
Invoicing
IT Systems
BudgetBlow outs
Security Pub
lic R
elat
ions
Market share
Death
Court Rulings
European idiots who can’t manage a buck
Political Environment
www.sustaingroup.netwww.sustaingroup.net
The New Zealand Emissions Trading Scheme
New Zealand was the first country outside of the European Union to implement an emissions trading scheme – Implemented in full after a staged approach bringing different industries online at different times, the carbon price is $12.50 per tonne (Agriculture is yet to enter / 2015)
Politics: implemented and legislated by a Labour Coalition Government and carried through by a National led coalition Government. When National came to power only a few minor adjustments have been made
Reversal of deforestation is occurring: with a peak loss of 20,000 hectares in 2007, in 2012 the Government predicts that deforestation will decrease to 4,000, with afforestation increasing to over 7,000
NZ emissions are down: after a 23% increase in emissions between 2003 / 7, New Zealand’s net emissions have fallen for the last two years
Just 2% have not met their obligations
Dr Nick Smith, Climate Change Minister: Dr Smith said the Kiwi scheme had clearly changed behaviour, with forest areas
getting larger and growth in price incentives for renewable electricity.
www.sustaingroup.netwww.sustaingroup.net
The New Zealand Emissions Trading Scheme
“Renewable electricity achieved an unprecedented 12-year high of 79% in 2010. 1340MW of new power have been consented to in the past year, with 59% wind, 26% geothermal, 13% hydro, and 2% tidal. No longer are fossil fuels dominating energy generation proposals.”
“As a result of New Zealand’s ETS, the government claims that it is on track to “comfortably” meet its Kyoto targets. Without the ETS, the country would be looking at exceeding its target by 19.5 million units and facing $485 in international costs. Now it looks like it will be hitting its Kyoto targets with a 21.9 million surplus.”
Drivers to innovation in:
Research in the agricultural and built environmentsPublic policy and planning Construction and infrastructure Governance and management Education and vocational training
www.sustaingroup.netwww.sustaingroup.net
And this has happened at a time of great upheaval in New Zealand….
The Christchurch Earthquakes
An economic recession
The Pike River Mine disaster
One Government followed another
www.sustaingroup.netwww.sustaingroup.net
Explanation of carbon pricing1. Legislation has been passed2. Carbon pricing to begin from July 1st 2011 3. 500 companies and sites to be affected – Australia’s heaviest emitters 4. Source of the emitters are those who are subject to current reporting
frameworks such as NGER’s5. They include a raft of organisations and sites from energy companies,
heavy industry, wholesale manufacturing through to waste management and landfill owners
6. The initial price will be $23 per tonne and this will rise by 2.5% in 2013-14 and again in 2014-15
7. From July 1st of 2015 the price will be set by the market and there is no forecasting as to whether or not the price may increase or decrease
8. There is likely to be a form of emissions trading before 2020 and it is even more likely that a form of emissions trading will take place between Australia and New Zealand
9. This is because New Zealand already has emissions trading in place
www.sustaingroup.netwww.sustaingroup.net
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Direct impacts
2. Pass through
3. End of the line
What impacts one impacts us all: impacts across the supply chain
1. Companies who will pass through
2. Companies who will be absorb
3. Companies and organisations who still have no idea
Example: Increase in the number of environmental and policy makers required to ensure compliance
www.sustaingroup.netwww.sustaingroup.net
People are much more savvy about the buying decision – they are seeking validation
What impacts will cost increases have on me and my family
The home front
We want to know what we are getting is what it says on the packaging
Require a higher degree of validation of the statements being made by retailers and manufacturers, service providers and even Government
Increase in the number of social media campaigns being driven by the use of new mobile devices and access to online platforms
Kimberly Clarke Sea Lord Nestle Sinarmus
Ch
ang
es in
b
ehav
iou
rIn the privacy of our own homes we know something needs to be done….
Question is: when and has that already translated into workplaces?
www.sustaingroup.netwww.sustaingroup.net
Australia and the business response & challenges
Increasingly, and irrespective of regulation, business was beginning to respond to climate change because consumer behaviour was shifting – but not on volume (which is why regulation is sometimes needed)
Government public policy execution in this area is still relatively infant – that is, unlike places such as Australia and New Zealand we currently do not have skills volume or surplus
Education frameworks are not at a level of maturity where programs have been developed or are in place to effectively teach the dynamics of such a diverse and complex series of subjects
The politics of climate change are still confusing the public narrative: this leads to business uncertainty when an Opposition riding high in the polls says they will scrap the “Tax”
www.sustaingroup.netwww.sustaingroup.net
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An election in 2013
The Opposition wins / takes Government at the end of 2013
Already reached year 1.5 of the fixed price period
The election cycle
“We will dump this unfair tax”
Practically impossible to remove the scheme by January 1st of 2014 which means it could be July 1st of 2014 – the end of year two and start of year three
Why is it practically impossible? The practicality of the politics and the complexity of a sophisticated piece of legislation. This is economic, structural, social and taxation “weaving” – also, it is plausible that the Senate will still be controlled by the Greens which would likely cause a double dissolution election – which is a very big risk to take…
www.sustaingroup.netwww.sustaingroup.net
Australia and the business response & challenges
Business and industry have been, and continue to complete carbon footprint analysis and develop carbon reduction programs
There is an expectation that investment will be unlocked and that will lead to innovation
New Industries already beginning to take shape: carbon trading, consulting and research, education, skills and employment
Henny Penny the sky will not fall in....
www.sustaingroup.netwww.sustaingroup.net
The opportunities
• Investment in renewable energy and transition • Investment and research and the growth of new
education programs / both tertiary and vocational• The creation of both new jobs and the transition
into changing roles • Interoperability between the New Zealand and
Australian programs • Movement of skilled labour across the Tasman• Leadership recognition for both Australia and New
Zealand
www.sustaingroup.netwww.sustaingroup.net
The global challenge ahead
• Durban in 2011 and Rio in 2012 • Large pieces of complex global change takes time• It took decades for global trade agreements to take
shape, it decades for a central governance watch dog to be in place - the World Trade Organisation
• Why did Copenhagen fail? The world was distracted
www.sustaingroup.netwww.sustaingroup.net
Carb
on
Pri
cin
g
Bra
nd
ing
Cash flow
Increased compliance
Hig
h w
ag
e
dem
an
d
Global Economy
US Job Numbers
GreeceUS Unemployment
The
Pric
e of
Iro
n O
re
The Chinese EconomyG
illard’s polling
Staff well being
Sale
s perf
orm
ance
Skills demand
To grow or not to grow
Interest rates
Inflation
Tax
Cost controls
Buyer
behavio
ur
The Board
Governance
Japans recovery
Demographics
Execu
tive loss
Climate change
Corruption
Competitors
Partners
Suppliers
The Banks
Early election
Coa
litio
n po
licie
s
Reven
ue d
iversity Payroll tax
Productivity
Leadership
YouTube
Social Media
Trade Barriers
Tw
itte
r
Invoicing
IT Systems
BudgetBlow outs
Security Pub
lic R
elat
ions
Market share
Death
Court Rulings
European idiots who can’t manage a buck
Political Environment
www.sustaingroup.netwww.sustaingroup.net
The global challenge ahead
“Business is engaged because unlike Governments we cross borders and are transnational – therefore,
by being held to account by shareholders and consumers alone, change occurs – with the rise of social media comes the added challenge of being
governed by a watchdog that is also not a regulator…..welcome to the biggest change in
compliance of all – the use of social media to force changes in behaviour” Matthew Tukaki
www.sustaingroup.netwww.sustaingroup.net
Matthew Tukaki
matthew.tukaki@sustaingroup.net
www.sustaingroup.net
www.unglobalcompact.org.au
Thank you