Agribusinesses’ gender diversity focus trumps indigenous relations

Aussie agribusinesses are focusing on gender diversity at the expense of indigenous reconciliation, but how do they rate in carbon reduction and other social changes?

Australian agribusiness companies are lagging behind those overseas and ASX-listed companies in other sectors when it came to the reporting of social and nature risks.

Agribusiness companies in Australia are behind in coming to terms with the demands of reporting on ESG risks, particularly when it comes to policies for promoting relations with indigenous Australians, according to a new report produced for Agribusiness Australia by KPMG.

The report, which was based on a study of 34 agribusinesses operating in Australia, said Australian agribusiness companies were “increasingly recognising” ESG issues as an opportunity with most reporting on specific carbon reduction targets.

But it said Australian agribusiness companies were lagging behind those overseas and ASX-listed companies in other sectors when it came to the reporting of social and nature risks.

Only 3.3 per cent of those surveyed had documented the use of Reconciliation Act plans or their equivalent involving a formal commitment to reconciliation with indigenous communities.

The report says the agribusinesses surveyed “appeared to address this aspect of social responsibility below what would be defined as a sufficient level.”

It says the businesses focused more on reporting on their actions to promote gender diversity than their plans to work with indigenous communities.

“Australian agribusinesses appeared focused on gender diversity at the cost of implementing policies dedicated to including and collaborating with indigenous people,” it said.

One of the exceptions, it says, was the Consolidated Pastoral Company, which has cattle stations in Western Australia, Northern Territory and Queensland.

The company has implemented reconciliation initiatives and community engagement plans since 2010 including helping to train and provide jobs for 31 indigenous people and plans for further job creation.

The report showed that only half of those companies surveyed had reported on nature related and biodiversity risks despite the fact that agribusiness companies were involved with rural and land issues.

Only 32 per cent of those with diversity and inclusion policies had set targets for the 2023-24 financial year.

“The multi faceted meaning of ESG requires business to prioritise areas for investment,” KPMG partner and national sector lead on agribusiness, Georgie Aley, said.

“But this remains challenging for Australian agribusinesses who are juggling with multiple, and sometimes contrasting, priorities,” she said.

The report says 79 per cent of ASX-listed companies surveyed had committed to being net carbon zero by 2050.

But it said that the level was much lower for privately owned agribusinesses where only 22 per cent said they had targets to reach net zero by 2050.

The report says this could be because a lack of external shareholders meant these companies were under less pressure to take action on climate change.

The report says there is a “sizeable opportunity for Australian agribusinesses to enhance the quality of their ESG reporting standards alignment and report their progress towards their sustainability goals in a more transparent manner.”