Execs from big banks and regulators to ramp up lobbying over climate

  • By Lewis Panther

Climate campaigners from the financial services industry and the big four banks are ramping up government lobbying.

Members of the Australian Finance Initiative (ASFI) are putting the finishing touches to a lecture to be delivered in Canberra later this month.

The organisation formed by 130 senior executives from major banks, super funds, insurance companies, academics and regulators is planning to launch a policy roadmap next year.

Even if the government is lukewarm to growing calls for the need for urgent action against climate change, the pressure group’s co-chair is confident they will be successful.

Simon O’Connor - who is also CEO of the Responsible Investment Association Australasia - said: “If you look at the global landscape, there’s an increasing urgency around climate change. 

“Sometimes when we sit here in Australia, in the Southern part of the planet, we get a bit lost in political back and forth and debates. 

“But the global momentum is really strong. The UN global climate week in New York last week showed very strong tangible commitments being made by both governments, corporates and investors, including the banking sector in terms of the role they will play each play. 

“I think it only heightens the really important need for the finance sector to be playing their part as the key lever in any response to climate change."

O’Connor says Australia is starting to show a strong response “and stepping up” the challenge against climate change. 

A steering committee with senior executives from across banks and insurance as well as APRA and ASIC is currently working towards establishing a “roadmap for realigning the finance sector to support greater social, environmental and economic outcomes for the country

He added: “We’re seeing the very tangible commitments coming out of superannuation funds in terms of commitments to emissions reductions and increasing capital allocations for low carbon investments. 

“There is also this really strong Australian Sustainable Finance Initiative that I'm involved in, which has brought together all the financial services - big banks, insurers, superannuation funds.

“So I think in spite of still lack of policy at a federal government level in Australia around energy and climate, the corporate sector in Australia just know they need to get on with the job.”

The fact that Australia is part of a “global capital market” means financiers have to accept and work within a foreign policy framework means corporates will adopt a climate change aware culture.

“Whether our government moves on this or not, we're all going to get caught up in the developments and acceleration from a global perspective,” he said. 

“Such things as European policy on action plans around sustainable finance have to be dealt with. 

“There are rules going through that will require high levels of disclosure on ESG and climate risk. So with many of our fund managers operating globally, they will have to adhere to these.

“Many of our super funds are investing globally. Many of our banks operate globally. 

“This is going to become the benchmark of good practice in the financial services sector, whether government moves or not. 

“We need to proactively respond to that, which I think is what the work ASFI is really trying to do.” 

A steering committee with senior executives from across banks and insurance as well as APRA and ASIC is currently working towards establishing a “roadmap for realigning the finance sector to support greater social, environmental and economic outcomes for the country”.

“The idea of that is to launch a policy roadmap effectively in the middle of next year,” he explained.

The lecture and a document to be published in December will set out interim plans. But as O’Connor has indicated the private sector - including consumers - already expects climate change proposals on the agenda.

He concluded: “Consumers are expecting that the product they take out plays a role in responding to climate change. 

“What we're trying to do is look through the noise of politics, and the short-term cycles of politics, to where the longer term trend is heading.”

This article was originally published in FINSIA’s InFinance publication. 

An upcoming Randstad Leaders Lecture assesses How banks and insurers are tackling climate change. Click here for more details