Australia’s financial services sector must address six critical challenges in order to navigate risks and opportunities, according to the Australian Sustainable Finance Initiatives (ASFI) which has released its first progress report.
The “Developing an Australian Sustainable Finance Roadmap – Progress Report: Navigating risks and opportunities for Australia’s future resilience, prosperity and wellbeing”, which included output from a process involving over 130 individuals from more than 80 organisations across all parts of financial services, as well as academia, civil society and government has identified the following areas as critical for the Australian financial services sector to respond:
- Leadership, culture and institutional structures
- Community and consumer interests and expectations
- Frameworks, tools and standards
- Decision-making and valuation
- Unlocking sustainable finance and allocating capital to where it is needed
- Policy, regulation and supervision
ASFI said it collected data on progress in other jurisdictions around the world in establishing their own sustainable finance roadmaps, with the progress report giving a detailed overview of progress made to date globally, as well as in its own market.
Simon O’Connor, co-chair of ASFI said that the progress report was an important first step for the financial services sector in outlining its role in addressing critical national challenges.
“We recognise that this is not a simple task. The risks and challenges before us require the financial system to continually adapt and evolve. Australia’s financial services sector has navigated risks and opportunities in our past, and we are now called upon to do so ever more urgently again today,” he said.
O’Connor further stressed that together with the rapid acceleration of changes in our climate, Australia was grappling with shifting demographics, slowing economic growth and productivity, urban congestion, technological disruption, changes to the way the society works, declining housing affordability and rising inequality.
ASFI is a collaborative initiative supported by insurers, superannuation funds, investment managers and banks.