In a comprehensive review of the Australian Government’s Green Paper on the Carbon Pollution Reduction Scheme, professional services firm Deloitte has said that the impact of doing business in a ‘brave new carbon-constrained world’ will be far-reaching, with organisations that are able to adapt and act more likely to prosper.

“The Carbon Pollution Reduction Scheme will fundamentally change the economic environment,” said Deloitte Australia Chairman Wayne Goss. “However many Australian businesses are still at the early stages of understanding exactly how these changes will affect them.

“What this debate means for our clients is that climate change is no longer just an issue for the environmental or sustainability team – it applies to every level of management whether it is tax, supply chain, corporate governance or reporting.

“Climate change is about to become an everyday business challenge with far reaching implications across the organisation and it will therefore be elevated to the agendas of every Board.”

Article continues below…

The paper, entitled Helping you to understand the climate change Green Paper, highlights the key issues that businesses need to urgently address.

These are:

1. Evaluate and monitor the intensity of emissions in your business 2. Understand how the Carbon Pollution Reduction Scheme will affect you, including:

* Are you directly liable? * Will the scheme affect your key markets? * How will the scheme affect the prices you pay for key supplies?

3. Prepare to change your business strategy to adapt to a carbon constrained economy.

Jon Stanford from Deloitte Economics, who led the firms review of the Government’s Green Paper and The Draft Garnaut Paper that preceded it said that businesses now recognise that the scheme will introduce significant structural change in the economy.

“It will change relative prices and costs, demand new structures and supply chains, and present opportunities to some sectors and limit others,” he said.

He added that it is now recognised that some organisations will prosper, while others will linger for a while and then disappear. “Adaption and action will be the key to survival in this ‘new world’,” he concluded.

Helping you to understand the climate change Green Paper is the first of Deloitte’s ‘Doing business in a carbon-constrained economy’ client alerts. It identifies the key issues, interprets the impacts, and articulates how to develop an appropriate response.