Australian businesses aren't ready for climate costs

Australian businesses aren't ready for climate costs

Almost half of Australian businesses are lacking the green skills and knowledge for new mandatory climate reporting starting this year, according to a new report by RMIT Online and Deloitte Access Economics.

Key Report Insights:

  • Readiness Issues: 43% of businesses are not prepared for the upcoming mandatory climate reporting.
  • Financial Concerns: 56% anticipate a significant impact on their finances due to climate change within the next decade.
  • Green Skills Demand: There is an urgent need for one million additional green-skilled workers across new and existing roles in the next five years. Managers with green expertise could see a 13% wage increase, amounting to a $1.7 billion opportunity by 2030.

This urgency is set against alarming projections of a $423 billion decline in economic output in a scenario with a four-degree increase in temperature, primarily due to reduced labour productivity. Despite the pressures of compliance with new climate reporting laws, 43% of large businesses acknowledge a deficit in green skills.

Addressing the Green Skills Gap

"We're at a tipping point. Many businesses know climate change will hit their bottom line, but they aren't ready for what's coming," said Chris Speed, Director, Regenerative Futures Institute, RMIT.

The report stresses a severe shortage in green skills, with 50% of businesses struggling to find appropriately trained talent. Critical needs are identified in engineering, science, and technical domains, as well as climate-focused soft skills. As demand for green expertise accelerates, RMIT is taking proactive steps to address these challenges.

In 2026, RMIT will officially launch the Regenerative Futures Institute. This institute aims to bridge the skills gap through interdisciplinary research and education, focusing on regenerative business models, circular economies, and sustainability innovation.

"Green skills are rapidly becoming essential for businesses. Addressing this gap is critical for ensuring Australia's economic resilience," added Speed.

Pressure from regulation

With new regulatory requirements coming into effect this year under the Corporations Act 2001, businesses will be under pressure to disclose climate-related financial risks and strategies for emissions reduction.

"Our report shows many companies are unprepared and that green skills are quickly becoming core for businesses. The creation of the Regenerative Futures Institute is an important contribution to solving this challenge,” said Nic Cola, CEO of RMIT Online.

To enhance resilience and mitigate losses, the report urges businesses to prioritise sustainability goals, reskill their workforce, map skills gaps, and prepare for climate reporting.

Find out more about the Regenerative Futures Institute here.

25 July 2025

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25 July 2025

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