Have you seen the latest coastline warnings?

By 2050, rising seas could swallow millions of homes and businesses across Australia, reshaping the places we live and work. According to Australia’s 2025 National Climate Risk Assessment, 1.5 million Australians living in coastal areas are at risk from rising sea levels and coastal flooding.

Every season brings more images of flooded main streets, scorched farmland, and communities bracing against the next natural disaster. Insurance is tightening, government targets are accelerating, and the way we do business is changing fast.

But these warnings aren’t just for alarmist news headlines or to encourage green activists, this is the new reality for all of us. When the tide turns, profit, people, and place are all on the line.

The only question: will your business take precautionary action, or risk being swept away?

The Australian Government’s 2035 climate targets

In September 2025, the Australian Government set the most ambitious emissions reduction target in national history. By 2035, the aim is to cut emissions by 62–70% compared to 2005 levels.

So what does that look like exactly?

• 2005 baseline: Annual net greenhouse emissions were around 631 million tonnes of carbon dioxide equivalent (MtCO2-e). [See source]
• 2024 progress: Net emissions have fallen to 446 million tonnes, a reduction of about 27%.
• 2035 goal: Australia needs to significantly cut emissions to achieve the 62–70% reduction target compared to 2005 levels above.

This is a sobering challenge: Since 2005, Australia has managed just over a quarter of the required emissions cuts. To meet the government’s 2035 pledge, we have to deliver more than double that achievement, within just the next ten years. 

The scale of transformation is  daunting and affects every sector. But Australian businesses have a long track record of resilience and practical action in the face of change, from rebuilding after disasters to pioneering new technologies.

As economic and social forces accelerate, working together and leveraging our values of fairness and ingenuity will be essential. Whether by compliance or by choice, every business now has a role to play in Australia’s most ambitious economic and environmental shift yet.

Compliance and risk: Australia’s new climate law

The government isn’t just setting climate targets, it’s fundamentally rewriting what it means to run a business in Australia.

In September 2024, Australia passed the Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Act 2024, making climate-related financial disclosures a legal requirement for large businesses from January 2025.

Group 2 will follow from July 2026, with Group 3 included from 2027.

This law means you can’t operate on assumptions or good intentions alone. Every reporting entity above the threshold [source] now faces binding annual responsibilities:

• You need to prepare a detailed ‘sustainability report’ within the annual report, tied to your financial statements. This means clearly showing how your business is exposed to, and is managing, climate risks, whether those are physical (like bushfires or floods), legal, reputational, or financial. This isn’t just about what’s happening inside your four walls, but across locations, assets, and supply chains too.

• You must now account for greenhouse gas emissions in three categories, which pop up in government documents as Scope 1, Scope 2, and Scope 3 [source]:

• • Scope 1 is what you produce directly, like fuel used in your business’s cars, factories, or equipment.
  • Scope 2 is the impact of the energy you buy (for example, the emissions from your electricity bill, even though they’re released at the power station).
  • Scope 3 is the catch-all for everything up and down your supply chain. It’s about the emissions tied to your suppliers or what happens to your products after sale. Full Scope 3 reporting will come into force for most businesses from 2026.

• Directors must sign off, publicly and in writing, that the report is full and accurate, following the new Australian Sustainability Reporting Standards [source]. In normal language:
  • AASB S1 sets out the general reporting principles for sustainability, making sure businesses are consistent and clear.
  • AASB S2 zooms in on climate, laying out exactly what climate risks, impacts, and emissions must be included [source].

 

For the first three years, the focus is on helping businesses get this right, not ‘gotcha’ enforcement. But misleading or missing data can still lead to investigations, penalties, and reputational hits.

If your business isn’t ready to meet these new rules, you risk losing out on tenders and contracts. ASIC (the regulator) can initiate action, and slow or incomplete reports will be a red flag for banks, investors, and business partners.

ASIC’s Commissioner O’Rourke said, ‘As more people consider environmental sustainability when making financial decisions, climate disclosure will continue to grow in importance. Enhanced climate disclosure will also benefit reporting entities themselves, enabling them to better understand their climate-related risks and opportunities over the short, medium and long term.’

Place as a profit lever: are you ready for the tides to turn?

The 2025 National Climate Risk Assessment is blunt about ‘Risk to Places’:

• Over 1.5 million people in coastal communities will be living in high risk flood and sea-level rise zones by 2050, if nothing changes.
• Outer urban and regional areas are identified as especially exposed due to poorer infrastructure, demographics, and location.
• Remote communities are facing growing climate and supply chain risks as disruptions worsen.

 

For business, Place is not just environmental, it is about:

• Asset insurability and valuation
• Supply chain continuity
• Compliance costs and contract eligibility
• Physical access to talent and markets
• Brand trust and customer appeal

 

If you haven’t stress-tested your business against the specific risks and opportunities of your Place, now is the time. Insurers, customers and regulators will expect you to know your risk exposure, control measures, and plans for resilience.

Risk and opportunity

This is not just about big companies or green PR. National policy and corporate procurement are redefining who gets to compete for the next decade of business growth.

• Rising energy costs: As the grid transitions, power prices become more volatile. Proactive upgrades — solar, batteries, insulation — protect margins and support eligibility for new contracts.
• Insurance shocks: At risk properties are seeing fast-rising premiums, coverage exclusions, and reduced lending; risk management now hits the balance sheet.
• Market access: Clients up and down the value chain are already requiring emissions data, risk statements, and climate adaptation planning as minimum standards.
• New laws: The new mandatory reporting law is already pushing directors and owners to re-assess everything from site risks to future capital needs.

Accountability, customer and employee expectations

Multiple surveys, including Deloitte’s 2025 Gen Z and Millennial Survey and Australian polls, show that the next generation of business leaders and consumers are placing unprecedented scrutiny on companies’ environmental and climate actions.

• Nearly 70% of Gen Z and Millennial respondents say environmental sustainability is important in choosing employers and brands.
• Over half research a company’s environmental and climate performance before making major purchases or committing to work.
• 67% of Gen Z say they will abandon a brand or stop purchasing if they lose trust in its environmental claims or actions.

 

If your business cannot show authentic evidence of progress and impact, you risk losing social license, contracts, and valuable, high-performing team members. This is about loyalty, trust and long-term market survival.

Action steps for leaders: survive and thrive

Get off the grid where you can
Audit your energy use and investigate solar, batteries, or upgrades. Even without recent incentive windows, low-cost finance and fast paybacks are now common for future-ready assets.

Assess flood and fire risks before your insurer does
Use independent risk assessors or council overlays to check your site’s exposure. Prioritise climate-safe locations when expanding or moving.

Map climate exposure
Review core customers and contracts for climate compliance or reporting demands. Prepare energy, emissions and resilience registers so you’re ready for new standards and audits.

Prepare your people and customers
Communicate your actions honestly, show evidence and progress, not perfection. Trust and loyalty follow transparency.

Place: your lever for sustainable profit

Place isn’t just one area of risk; it’s one of the forces shaping your balance sheet, budget, and future. It drives compliance costs, customer relationships, supply chains and talent. Focusing on Place is not a moral choice, it is a business strategy: mastering your risks while making profit genuinely sustainable.

Australia is already experiencing more intense heatwaves on land and sea, rising seas and more frequent and severe flooding. What happens next depends on what we collectively do now.

Australians have always rallied together through adversity, and climate targets will challenge every sector. Many believe teamwork and innovation can build a safer and more prosperous future, even as national and global reports warn of severe impacts; coastal loss, extreme heat, economic risk, if we fail to act. The coming years demand more than business as usual; they call for the best of our national character and collective resolve.

The tide is turning. It’s time to act now.

References (with direct sources):

• Australia’s National Climate Risk Assessment Key Risks
• Treasury Laws Amendment (Financial Market Infrastructure and Other Measures) Bill 2024—ASIC Guidance
• AICD: Climate reporting legislation passes Senate
• Deloitte 2025 Gen Z and Millennial Survey
• Australian consumer sustainability research

All numbers, research, and law links are the latest available as of October 2025.