Insights

Two months into 2025 we are already witnessing significant shifts in the ESG and sustainability landscape. The US government has backed away from climate commitments, prioritised fossil fuel expansion and fuelled rising anti-ESG sentiment. These developments reflect broader political and social tensions around sustainable finance and corporate responsibility, with global implications.

Australia is deeply connected to global markets where shifts in US policy can influence investor confidence, supply chains and corporate decision-making here. However, Australia is staying the course and accelerating to make our economy more sustainable.

Climate reality: the facts remain unchanged

Despite these policy rollbacks, the reality of climate change remains undeniable. The science is clearer than ever – 2024 was officially the hottest year on record. For the first time, global average temperatures exceeded 1.5°C above pre-industrial levels (Copernicus Climate Change Service).

Australia has faced the consequences firsthand – devastating floods, extreme heatwaves and increasingly intense and prolonged bushfires. The physical impacts of climate change are no longer distant or intangible concerns; they are here, affecting businesses, communities and ecosystems in real time.

Australia’s rapidly evolving ESG and sustainability landscape

Australia’s policy landscape is shifting rapidly. From 1 January 2025, new legislative requirements mandating climate disclosure reporting (AASB S2) have come into effect. Organisations that meet certain size and revenue criteria must now officially begin their climate reporting journey – if they haven’t already. While this mandate is being phased in over three years, even smaller entities and those exempt from mandatory requirements will likely feel growing pressure to assess their environmental impact.

In addition, several other substantial developments in 2024 are likely to have implications for certain organisations in 2025. A few of these include:

• Australia’s Circular Economy Framework: Australia’s blueprint for transitioning to a circular economy, providing guidance, priorities and examples of how to improve circularity.
• National Waste Policy Action Plan: Key actions for reducing waste generation, increasing recycling rates and tackling environmental impacts of waste to contribute to a more circular economy.
• Australia’s Strategy for Nature 2024–2030: Our national biodiversity strategy and action plan which sets ambitious targets for biodiversity conservation, ecosystem restoration, and nature recovery and protection.
• Environmentally Sustainable Procurement Policy and Reporting Framework: The Government’s procurement framework for selecting goods and services that have the most positive environmental impact throughout their lifecycle.

How we guide our clients

Navigating this constantly changing landscape can feel overwhelming and challenging. We are guiding and supporting clients, large and small, through the complexity of meeting requirements or enhancing their business operations and value. For example, we worked on a large-scale project with Major Roads Project Victoria (MRPV) to accelerate mandated social procurement in roads and build the capability of the sector. And we worked with Haven Home Safe who have chosen to develop a sustainability strategy and framework so they can embed sustainability into their organisation.

At Think Impact, we specialise in embedding purpose at the core of your ESG approach and sustainability strategy. We help businesses centre stakeholder voices, build leadership capacity and develop actionable roadmaps for meaningful impact. ESG and sustainability are not just about compliance or ticking boxes – they are about building resilient organisations that can thrive in an evolving world.

If you are not sure where to start or want to know more about navigating this rapidly changing landscape, please get in touch with us via hello@thinkimpact.com.au.