New finance sector roadmap outlines vision for a more sustainable future

More than 80 financial organisations have contributed to the roadmap      

Australia’s finance sector has united to create an industry-led roadmap that aims to align the nation’s financial system with a more sustainable future and support the economic transition to net zero emissions by 2050.

The Australian Sustainable Finance Initiative (ASFI) last week released a roadmap that calls on financial organisations to embed sustainability into their practices, help the transition to net zero, and support Australia to achieve the sustainable development goals (SDGs).

The roadmap contains 37 recommendations designed to reshape Australia’s financial system to one that is more resource-efficient and inclusive, as the nation recovers from COVID-19.

Speaking at the Responsible Investment Association Australasia conference on Friday, ASFI Co-chair Jacki Johnson said this roadmap was unique because it was industry-led – featuring input from over 80 organisations including major banks, insurers, and super funds. 

“Other financial roadmaps around the world have tended to be government-led and then engaged with industry later as it came to implementation,” Johnson said.      

“So we feel that the way ASFI has come together means that we’re taking responsibility as an industry in our own right.           

“[It’s] about the finance system taking accountability for what we feel we could do to create a system change… Calling out where we do need some support and help, but primarily taking the responsibility ourselves.” 

ASFI co-chair Simon O’Connor told Pro Bono News this roadmap came about because the sector realised it needed a coordinated plan in order to play a constructive role in addressing the big sustainability challenges of the 21st century. 

O’Connor said this was not a report that would just “sit on a shelf and get dusty”. 

“We’re not sending the government [this report] saying ‘here’s 37 things we want you to do’,” O’Connor said.

“This is a report by the industry saying ‘here’s 37 things that we are going to do and we would really like to partner and work collaboratively with you, the government, to deliver on this’.”

To ensure the roadmap is implemented effectively, a permanent sustainable finance body will be established in 2021 to oversee its delivery.

O’Connor said money has already been committed to support this next phase of the initiative, which will keep the sector accountable. 

He said the roadmap was a way of keeping up the momentum in the sector for sustainable finance. 

“There’s people [in the sector] really actively building an impact investing market, there’s some people actively working on some scenario analysis tools around climate change,” he said.

“And so what we are trying to do with this plan is join the dots between all the activities going on, bringing together the partners that need to come together and then setting out a roadmap for taking that forward.” 

Ultimately, advocates believe the roadmap offers Australia the best chance of reaching net zero emissions by 2050 and achieving the SDGs.

But just as importantly, O’Connor thinks the roadmap will deliver much greater transparency from financial organisations around how they’re considering sustainability and climate change in their operations. 

“You’ll see much more consistency in the labelling around ethical and responsible products in the marketplace,” he said.

“You’ll start to see portfolio holdings being disclosed, better sustainability reporting, better data from companies, and ultimately catalysing more capital flow towards really impactful businesses, technologies and assets.” 

The full roadmap report can be seen here.