Investor Group on Climate Change says decarbonisation plans will support an orderly transition to net zero

Investors warn retirement savings of millions of Australians will be ‘negatively impacted’ unless there’s a rapid, orderly and fair net zero emissions transition.

‘The more orderly the transition to net zero, the better able investors will be to protect and preserve the value of their investments,’ a new report states. Picture: Getty Images

An Australian investor group representing members with more than $30 trillion in assets says plans being developed by the Albanese government to decarbonise sectors like energy and agriculture must align to the Paris Agreement’s goal of limiting the global temperature rise to 1.5C.

In a new report released by the Investor Group on Climate Change – which represents Australia’s largest superannuation and retail funds, specialist investors and advisory groups – investors outline their priorities for the government’s decarbonisation plans to ensure the country remains a competitive place to direct capital during the net-zero transition.

The group says sector pathways must align to Paris Agreement objectives, be credible, comprehensive, informed and transparent.

The government is working with industry, the climate movement, experts, unions and the community to develop decarbonisation plans across six industries: electricity and energy, industry, the build environment, agriculture and land, transport and resources.

“Investors will rely heavily on the sector transition pathways to make decisions about where and how they direct large amounts of capital that is potentially available to support Australia’s decarbonisation efforts,” the report states.

“Unless Australia’s economy decarbonises in a manner that is rapid, orderly, and fair, the long-term retirement savings of millions of its citizens will be negatively impacted.

“The more orderly the transition to net zero, the better able investors will be to protect and preserve the value of their investments in the best interest of their beneficiaries.”

IGCC chief executive Rebecca Mikula-Wright said decarbonisation plans would form a key part of the government’s response to substantial clean energy subsidies in the United States, EU and similar countries like Canada.

“Investors will rely heavily on the sector pathways to make decisions about where and how they direct large amounts of capital to support Australia’s decarbonisation efforts,” she said.

“Sector plans will be pivotal in establishing a shared understanding of the required actions within Australia.”

Cbus Super chief investment officer Brett Chatfield said sector-by-sector decarbonisation pathways would help the large super fund identify industries central to Australia’s transition and important to its members.