Staying the course on net zero
To continue to seize opportunity and manage risks, investors must move beyond net zero commitments and focus on delivering outcomes.
Link to chapter: Staying the course on net zero.
2023 is the eleventh year Right Lane Consulting has published its significant superannuation research paper, the Forces at Work Report. It is a chance for Right Lane Consulting to engage with some of the big issues facing our profit-to-member superannuation partners, from industry structure, scale and competition to the biggest policy issues facing the sector.
For the first time, this subscription-only report includes two publicly available, standalone chapters exploring the net zero transition and gender in the superannuation system respectively. These issues are of great import and immediate concern to the superannuation sector and have wide-ranging ramifications that extend beyond the sector to impact society more broadly.
Right Lane Consulting is proud to have collaborated with Melbourne Climate Futures at the University of Melbourne on this chapter.
Staying the course on net zero
We sometimes characterise funds’ approaches to sustainability as either: show me how it will impact the company’s long term value creation thesis or I’m not interested; or climate change, natural resource conservation and other sustainability and social license factors will impact our members’ futures and we have an obligation to exercise our influence in capital markets to protect their best interests. Increasingly, we are seeing a third way, which combines these approaches. On one hand, climate change is creating material financial risks for funds and companies that need to be managed. On the other, the economic transitions inherent in meeting globally agreed emissions goals are creating significant new investable opportunities.
This research paper explores how funds can enjoy the benefits and avoid the risks of net zero investing. We discuss the rapid increase in net zero commitments and investments, the increasing demands on investors to deliver on these commitments, headwinds they face in doing so, and the imperative for funds to stay the course and further lean into the opportunities provided by the net zero transition.
By pushing for policy change in the now more favourable political context, uplifting climate-related investment capabilities and accelerating integration of net zero investment strategies, funds can meet and exceed the demands of the challenging but rewarding investment environment in the era of decarbonisation.
This chapter and more broadly, the Forces at Work Report is a collaborative effort with the clients we serve and the profit-to-member superannuation ecosystem we are part of. We would like to thank the 35 CEOs and senior executives who gave interviews for this year’s report, along with subscribers and contributors who shared comments on the drafts. More information about subscribing to the full report is available on page 2.
The authors would especially like to thank the industry leaders and experts that generously contributed their time to participate in interviews and provide feedback for this chapter. Your significant input and invaluable insights have made this truly a collective effort, and we look forward to collaborating with you in future on the essential work of the net zero transition.
CEO, Right Lane Consulting
Arjuna Dibley
Head of the Sustainable Finance Hub, Melbourne Climate Futures
Link to chapter: Staying the course on net zero
This research paper, Staying the course on net zero, forms one chapter of Right Lane Consulting’s 2023 Forces at Work Report. While the full report is available to subscribers only, this and another chapter, Bridging the gap in a gendered superannuation system (co-authored with Women in Super), have been made publicly available to support the advocacy around these important issues.
If you would like a copy of either of these research papers, or to subscribe to the full 2023 Forces at Work Report, please contact info@rightlane.com.au).