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Australia should reassess climate reputation: AusSuper chair

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The chair of AustralianSuper has cautioned Australia should be re-evaluating its global position as an exporter and emitter, as other countries seek to protect themselves against climate change.

Don Russell, chairman of AustralianSuper made the comments when asked about global trends at the Citi Australia and New Zealand Investment Conference. 

He was previously Australia’s ambassador to the US in Washington and between 1985 to 1993, was principal adviser to Paul Keating, during his time as treasurer and prime minister. 

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“There are all sorts of trends at work, which we need to come to grips with, but there is one aspect of the current pandemic that I think we really need to be careful about and that’s our reputation,” Mr Russell said.

“Because the world is increasingly protectionist.”

He referred particularly to the EU and the US, adding the notions of an American industry being put first will not disappear overnight if there is a change in president. 

“We’re going to be operating in a world where there’s going to be a lot of sympathy in each country to restrict the exports from other countries, really in reality on basic protections grounds,” Mr Russell said.

“So they’ll be looking for every conceivable way of making that pass. And if they can demonstrate that you are from a country which is deemed to be taking less significant action on emissions reductions or that you are responsible for more emissions than you really should be, then I think we are vulnerable to lobbying and all nations around the world.

“If we stand out, if we are perceived to be a free rider on the global need to reduce emissions, in that environment I think we’ve got to be conscious of our world position, not just what’s going on in Australia as well.” 

Recent accounts reported BHP confirmed after its annual meeting that China has stopped taking shipments of Australian coal, following reports from S&P that Chinese firms were ordered to stop importing the commodity. 

Mr Russell noted the country still has a way to go on reaching a national consensus around energy policy, how emissions are managed and how different sources of energy are treated.

“That has not been helpful. We haven’t really been able to unravel that because in reality, the industry needs some measure of certainty, because these again are long-lived assets and you need some idea [around] the pricing and the costs that will be associated with the particular investment over [its] life,” he said.

“So in reality, that’s not going to be solved until we have some level of bipartisanship.”

But practical solutions, such as those that were applied during the COVID crisis rather than ideological debates, could allow Australia to “sneak up on the problem” and carve out some agreement. 

Mr Russell noted sustainability and climate change are looming large for investors, who have to consider long-term horizons.

“If you’ve got members’ money, you really do need to think about what this company will be worth, not next year but in 10 years’ time, because if you get that wrong, it’s not necessarily good for your members,” Mr Russell said. 

“But if you get it right, you’ve actually delivered on the undertaking that you took when you take their money in the first place. I think it’s even more pressing than usual.”

AustralianSuper was one of a number of investors committing to a new climate-linked initiative launched this week, promising to drive further Australian emissions reductions of 230 million tonnes over the next decade, in addition to what is already projected.

 

Australia should reassess climate reputation: AusSuper chair
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Sarah Simpkins

Sarah Simpkins

Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth. 

Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio. 

You can contact her on [email protected].

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