Sustainability is rapidly gaining importance across Australia’s business landscape. Once considered a niche or a ‘nice to do’ activity, sustainability has quickly become a requirement of good business planning and operations. The changes are ushering in new models of working, with increased emphasis on transparency, collaboration and partnerships between businesses across supply chains and industry sectors. Two main factors are driving this:

Consumer preferences – Consumers are increasingly making purchasing decisions around sustainability credentials and larger organisations are leading the market response to this

Policy and regulation – The Australian Government has drafted mandatory sustainability reporting standards to align with international standards. Draft legislation was released in January 2024 with commencement date for reporting now proposed to be for financial years beginning on or after 1 January 2025 . See our article herefor more information on the proposed legislation and its impact on your business

Large organisations and peak bodies lead the way

Large organisations across many sectors have already set ambitious carbon reduction targets and are voluntarily reporting on their progress. Examples of large industry leaders with targets include:

  • Woolworths– 19% reduction in supply chain emissions by 2030
  • Coles– Net Zero by 2050
  • Salesforce – 50% emissions reduction by 2030, near zero emissions by 2040
  • Wesfarmers– Net Zero by 2030 for their retail businesses – Kmart, Target, Bunnings and Officeworks

Some industry leaders are going further and setting supplier engagement targets. For example, Salesforce is aiming to have 60% of their suppliers having set their own science-based targets by FY25 and Coles has committed that 75% of their suppliers will have science-based targets by FY27. That might be your business. Even if it’s not, others will soon be following with such targets.

Many peak industry bodies are also driving sustainability forward, supporting strong targets for their industry members. Some examples include

These peak bodies are leading the way in supporting their members to step up, ensuring they are equipped to meet the scale and speed of the change towards a sustainable, low carbon economy.

So what does this mean for my business?

  • Your larger clients or customers will soon be asking for your carbon emissions data for their reporting. They will need this data whether they are already reporting voluntarily or will soon have to under the new sustainability reporting standards. This is because their supply chain emissions data (Scope 3) is your business’s carbon footprint (see our article GHG & Carbon Accounting: Getting Startedfor an explanation of reporting scopes).
  • Your business needs to be aligning itself with your clients’ sustainability ambitions and with your industry sector targets. Otherwise, there is a risk to your business of failing to meet your clients’ and industry expectations.
  • Procurement teams within large organisations are increasingly requiring emissions data as part of contractual requirements. You need to have that data ready to go to remain competitive and win contracts.

Being prepared and having your emissions data ready will ensure that your business does not fall behind and remains competitive during these rapid changes.

Where do I start?

The first step is to measure and quantify your GHG emissions by developing an emissions inventory or carbon footprint. This is a simple first step that you can take to be ready.

This inventory becomes your base line, enabling you to benchmark your business against others within your sector and to set emissions reduction targets. It gives you the data to collaboratively support your clients or customers and to win new contracts. See our article GHG & Carbon Accounting: Getting Startedfor the steps you need to take to measure and quantify your emissions.

Just as importantly, assessing your carbon footprint is the first step in the process of decarbonising your business – working in partnership with your clients or customers to reduce emissions and supporting the change to a more sustainable, low carbon future.

To conclude

Carbon emissions reporting is becoming an integral part of the Australian business landscape. From huge global corporations to small business there is a move towards greater transparency on carbon emissions and your business needs to be getting ready, so you don’t fall behind.

Need some help? NettZero has specialists who can assist you to get started with measuring and analysing your carbon footprint. Contact usto find out more.