On Perth, a sustainability salon and how the Feds are pushing business away

14 November 2013 — If you want to know what’s driving green politics in this country go to Perth and Western Australia.

The Fifth Estate did last week for another of our Sustainability Salons. Like our other salons, the objective of this event was to gauge what are the major drivers for greater sustainability, where the roadblocks lie and how to break through.

Our guests were brilliant representatives of the people most likely to be able to influence this agenda:

  • Senator Scott Ludlam
  • Lord Mayor of Perth Lisa Scaffidi
  • Mayor of Fremantle Dr Brad Pettitt
  • Chairman of the WA Planning Commission and most recently director general of the WA Department of Planning Eric Lumsden
  • Leighton Properties managing director Mark Gray
  • Mirvac chief executive officer of development and group strategy Brett Draffen
  • LandCorp chief operating officer Nicholas Wolff
  • Norman Disney & Young global director sustainability and director Green Building Council of Australia (and former chair) Tony Arnel
  • HFM Asset Management director and co-founder Damien Moran
  • Senior research fellow Curtin University and former investment banker Jemma Green

Absent in person but not in thought were environmental scientist, ABC Gardening Australia presenter and Research Fellow at Curtin University Josh Byrne who, ahead of the event, provided an invaluable briefing on the politics, economics and sustainability challenges for Perth and WA. Sadly Byrne was taken ill after frequenting a late night eatery parked somewhere near Potts Point, which shall remain nameless lest we end up in court.

Also absent was the WA Property Council of Australia’s executive director Joe Lenzo who was summoned to the minister for Local Government’s office on the evening to discuss some firey amalgamations issues. Likewise, Lenzo has provided invaluable briefings that will find their way into the ebook and further reporting.

Let’s straight away give a really special thanks to our co-lead sponsors, LandCorp and Leighton Properties and supporting sponsors Norman Disney & Young, City of Fremantle and Mirvac, who “got” what we were trying to do and over a period of six months or more helped shape a purpose and plan for how to turn the concept for this event into a reality.

Guests reported it was worthwhile; that it was illuminating to find out what people really thought in a calm and intimate environment with everyone “speaking from the heart”, as one guest put it.

Scott Ludlam was hugely impressive; surely political leadership material of the highest order, who has proved he can work across political and business interests to achieve solid outcomes (see what the Property Council’s Caryn Kakas said about him in a recent interview).

Lord Mayor of Perth Lisa Scaffidi proved engaging, engaged, fully switched on and listening for the directions that her beautiful city should choose for its future.

Mayor of Fremantle Dr Brad Pettitt is one of the national stars on sustainability, bringing a deeply knowledgeable academic background to the on-the-ground challenges for a part of the country that never fails to charm.

Chairman of the WA Planning Commission and most recently director general of the WA Department of Planning Eric Lumsden impressed with his determination to finally bring a strategic shape and plan to Perth and WA.

Leighton Properties managing director Mark Gray and Mirvac chief executive officer of development and group strategy Brett Draffen brought the heavyweight of development and influence to the table. What was most impressive was their commitment to sustainability – unquestioning and based on rational strategies of asset allocation and risk management.

LandCorp chief operating officer Nicholas Wolff heads a massive operation that works not just in urban but in some of the most challenging outback communities. In so many ways LandCorp is a powerful player and has the skills and the clout to change the game.

Norman Disney & Young global director sustainability and director Green Building Council of Australia (and former chair) Tony Arnel brought not only his direct personal engagement in green buildings in Australia and globally, but the realities of how the designs must constantly push against the bulwarks of convention and bureaucracy.

HFM Asset Management director and co-founder Damien Moran was a must for the work his company has done on one of the most critical areas of sustainability – the retrofit of existing buildings. His company has won a contract to audit all of the Perth’s CBD buildings for their retrofit potential, in terms of energy, facades, insulation and even solar – thanks to the City of Perth.

Senior research fellow Curtin University and former investment banker Jemma Green is another rising star. Green has worked for seven years with JP Morgan in London and written a thesis that has changed the way Moody’s will value the risk of water scarcity in mining operations and is increasingly the public face of sustainability, appearing on television, radio and in learned contributions to publications such as The Conversation. Ahead of the federal election, Green obtained personal interviews with both Greg Hunt and Malcolm Turnbull. The subject of these discussions was the Emissions Trading Scheme in Europe; the details are confidential.

As usual with our salons we recorded the conversation and will bring you direct reports of what guests said on the night (it’s possible that some guests will want some comments to be unattributed and to remain as background).

The results will also be published in a new ebook soon, but here’s a taste of the key messages were.

Most powerfully for The Fifth Estate was the sense that Perth and WA are driving the national green political agenda.

First, this is centre of the mining boom that has dominated the national economy. This is the place that’s been credited with allowing the nation to sail through the GFC, with barely a hiccup. It’s where the Reserve Bank has looked to decide on how to work it s interest rate levers.

And it’s here that you see the origins of the friction that plagues the national agenda: where political support for the monetary riches of resources and coal in particular butts up against the reality of climate change and sustainability for everyone else.

The irony is that the miners themselves try hard to be as sustainable as possible in their operations, investing in solar and other renewable resources, while sending highly paid lobbyists to Canberra and Perth to ensure nothing tampers with their ability to extract their wealth.

The result in WA is a state political agenda that denies climate change and sustainability and sends a weird dissonant message that we can party like it’s 1999.

Sound familiar?

Meanwhile business and local councils in Perth and WA “get” climate change and sustainability. As they do elsewhere around the country.

That’s because local leaders such as Perth Lord Mayor Lisa Scaffidi and Fremantle Lord Mayor Brad Pettitt are dealing with the problems on the ground: 1000 people a week still moving to Perth, pressure of housing prices that are too high, urban sprawl that makes it expensive for ordinary people to travel to jobs, and an environment that’s in danger of becoming too degraded to support our lifestyle.

The state bureaucracy gets it too. Eric Lumsden, who recently moved from his former post as director general of the Department of Planning to the even more powerful post of chair of the Planning Commission is absolutely committed to WA carving out a strategic and sustainable plan for itself.

Business gets it. Leighton Properties’ Mark Gray and Mirvac’s Brett Draffen both talked about the allocation of capital. This requires logical and rational decisions. It’s a numbers game and it’s based on risk assessments of climate, resources scarcity and overall sustainability. Including the requirement of stakeholders, especially investors.

Draffen pointed out that a few years ago only 10 per cent of its investors were foreign. Today it’s 50 per cent, and many are institutional heavyweights from Europe and elsewhere, who have no tolerance for product that doesn’t pass the sustainability test.

Property, after all, is about a safe, steady asset long term.

In the broader community you see it too.

On Monday night’s ABC television panel program Q&A, a line-up of top businesspeople spoke with one voice – carbon needed to be reined in. All but one said it needed a price; better still an emissions trading scheme.

Carol Schwartz, a former national president of the Property Council and currently chair of the Women’s Leadership Institute, starred.

Calm, considered, immaculate as ever, Schwartz said she learned a long time ago that without a sustainable and socially equitable framework your business was doomed to be… unsustainable.

This extends to diversity and women, an emerging topic in the property industry. Schwartz cited studies that show a cohort of the most intelligent people are consistently outperformed on decision making by a diverse group of people.

On climate and carbon emissions, Schwartz was also unequivocal: we need a carbon price and a carbon trading system.

Fellow panelists David Knox, managing director and chief executive of Santos Ltd (yes, a mining company); John Symond, founder, Aussie Home Loans; and Elizabeth Proust, chair of Nestle Australia, all agreed.

They were here for the long term, risk needed to be managed.

Graham Bradley, non-executive chair of HSBC Bank Australia agreed on reducing emissions but said direct action could achieve the same results, pointing to the legislative frameworks imposed in the US.

There’s a big difference with the Australian scene though. In the US, the political leadership wants to do something about climate change. In Australia the leadership says it’s a “load of crap”.

Our salon guests said the biggest difference between business and government is time frames. The government is there for four years, or three; business wants to be around for a lot longer.

So that leads us to believe that our current Feds don’t much think they’ll be around for very long.

Well, prime minister Tony Abbott is heading that way, pushing further and further out to an extreme limb that’s alienating Australia world wide.

At the Warsaw climate talks he not only failed to send the environment minister but continued to slash programs and funding to anything related to climate change or sustainability.

While The Philippines reels from the annihilation of 10,000 people, devastation for countless more and the Warsaw talks is now attended by 30 ecologists who are on a hunger strike until there is meaningful global action on climate change.

Australia was handed a fossil of the day award at Warsaw. But it’s worse, we’re turning into carbon criminals.