A more collaborative approach to innovation is needed to enable the supply of technology that is required to meet Australia’s 43 per cent emissions reduction target, business leader and former CSIRO chair David Thodey says.
This includes greater coordination between state and federal governments, as well as wider appreciation of the diversity of the technology sector. He stressed the need to commercialise university research, but notes that not all research and development must meet commercial ends, citing social or environmental ends as examples.
Mr Thodey, who is the chair of accounting software giant Xero, told InnovationAus.com that although full alignment will never be reached between the different governments, there should be more communication around innovation and funding programs.
“But if we can have, as far as a priority list, a good industry strategy at a federal level, then each state can build their own [based on the themes of the national strategy]. I think there are opportunities to do that,” he said.
Mr Thodey was speaking on a panel discussing the impact of the green economy on jobs and businesses at the Australian Information Industry Association (AIIA) conference at Parliament House on Wednesday.
Australians are highly innovative, but the country has “been very rational, we put [our investments] all into the resources sector, and we’ve made a squillion”, Mr Thodey said. He considers the biggest barriers to decarbonisation to be the capacity of supply chains and the availability of resources.
“There’s a lot of money out there, so I don’t think money is the issue. However, a 43 per cent emissions reduction by 2030 is pretty challenging, incredibly challenging. It’s not [about] money, it’s resources, it’s supply chain,” he said.
“Can we get supply of all the things we need to get a 43 per cent reduction by 2030? I think we can, but it’s not going to be [easy] it’s going to be very difficult.”
Although he believes there is enough money to fund the decarbonisation of the economy, Mr Thodey claims that some investors are “not fully appreciative of the incredible amount of capital required to actually decarbonise”. However, he also acknowledged that access to finance for green companies is becoming easier.
“There’s an enormous amount of change in terms of access to finance. In some cases, you can get, some compensation for being a green company, and that’s really great, and I think we should try and encourage that,” he said.
“You do need to get a strong flow of capital into [green companies], at risk capital… it’s not just venture capital. I do think governments play a role in stepping in where there is… market opportunity. They can help for a while but then take a step back and let the market go from there.”
He also called for more mechanisms to ensure polluting businesses are kept accountable.
“Even getting your carbon footprint clear with a scientifically endorsed methodology is not straightforward. It takes a lot of effort to do that. And then secondly, we do not have standardisation of how we report [carbon emissions]… the standards boards are coming up with different standards,” Mr Thodey said.
“What happens if you don’t get to 43 per cent? You don’t get there, there’s no consequence. So there’s got to be accountability in the system somewhere, but I think we’ve got to be really careful we don’t unintentionally pass that down to those that can least afford it. So I don’t have a magic answer to that, but I think it’s a very real issue.”
Importantly, he says there needs to be a cultural shift among Australians to capture their imaginations around science and technology. He jokingly suggested that “most Australians know more about the full forward at the [Sydney Swans] than about great innovators”.
Ultimately, although Mr Thodey wants to encourage governments and the tech sector to acknowledge the complexity of decarbonisation he remains “positive” and sees “incredible opportunity”.
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