The year began with news no-one wanted to hear. For a decade, there had been hopes that global temperatures might not exceed 1.5°C above pre-industrial levels, a goal that had been set as part of the 2015 Paris Agreement. But in early January, the results came in for the 2024 calendar year: the average had been 1.55°C above those levels. We’re now in new and unknown territory.

What does this mean? 

The difference in impacts between 1.5°C and 2°C are significant. Higher temperatures increase droughts, fires, flooding, ice melt and sea level rise, with growing threats for nature, health, food and water supplies, livelihoods and economies. They could mean life or death for many island states. They also increase the risk of crossing various tipping points, such as the breakdown of ocean circulation systems or the release of methane from permafrost. Any of these impacts could heighten the risk of regional or global conflict.

Might this temperature rise be just a blip, an aberration? Possibly – we can hope and strive for less heat in 2025. This doesn’t yet mean that the 1.5°C goal is lost. 

However, the trend points upward, with each of the past 10 years (2015–2024) being one of the 10 warmest years ever recorded. It’s happened quite suddenly and much quicker than scientists had been predicting. 

A United Nations report in October 2024 said global action on climate change was falling “miles short of what’s needed”. By 2030, greenhouse gas emissions would need to be cut by 43% compared with 2019 levels, but all current government plans combined – if fully implemented – would see them fall only 2.6% by then. Greenhouse gas pollution at these levels, the report said, “will guarantee a human and economic trainwreck for every country, without exception”. 

Targets of 7% or 7.5% had been proposed by United Nations bodies for several years but with every year’s delay, the size of the cuts required increases. (As far back as 2021, articles in Acuity had suggested “8% per year – starting now”.) In October 2024, United Nations secretary-general António Guterres advised that emissions must now drop 9% every year to 2030, to limit temperature rise to 1.5°C and avoid the worst of climate change.But there is hope, the report said. Bolder national climate plans – if done well – could avert climate chaos and deliver “… economic growth and opportunity, more jobs, less pollution, better health and lower costs, more secure and affordable clean energy ...”.

All countries must act, but developed nations such as Australia and New Zealand which have contributed more to the problem, have a greater responsibility. We should take the lead now and commit to reductions of 9% per year.

Acting locally

What can CAs do to help? The good news is that we know exactly what causes the problem – mainly burning fossil fuels. We also know there are suitable, affordable alternatives and solutions. And we know what will happen if we don’t act. 

Global solutions often start with local action. It’s worth checking and understanding our own workplaces first. Here are five things you can do – this year – to make a difference:

1. Measure emissions in our own businesses. Study and understand the results. Measurements should include Scope 3, likely to be the largest part and commonly over 80% of total emissions, with business travel being a large part of these. (See below.)

2. Reduce emissions. Set an ambitious target – aim for 9% a year – then monitor and manage this. Eliminate waste. Offset emissions that can’t be reduced. The effect on global emissions will be hardly discernible but every bit counts. And fortunately, this is just a start.

3. Learn about businesses and their impacts on climate and nature. A playbook for accountants produced by CA ANZ and the Association of Chartered Certified Accountants, How SMEs can create a more sustainable world, is highly recommended. Then, keep on learning. Our greatest contribution will be the advice we give. Help businesses to plan further ahead. Avoid clear risks, such as dependence on fossil fuels, climate impacts on value chains, development in low-lying areas, insurance retreat, changing rules and reputational risks.

4. Upskill in climate-related financial reporting. While only certain, usually large, entities are legally required to report in Australia and New Zealand at present, many more will need to in time to meet the expectations of customers, value chains, lenders, shareholders or public expectations. CA ANZ offers resources for keeping up to date with climate-related disclosures.

5. Reach out. Collaborate with suppliers, customers and others on the same path. Listen to young people – it’s their future that’s at stake. Offer help when you can, ask for help when it’s needed – we’re all in this together and no-one has all the answers. There is much to be gained or lost.

People expect accountants to play a key role in the fight against climate change and CAs have an obligation to act in the public interest. When we are facing a major crisis and we have – or can develop – vital skills, resources and connections, the possibility of contributing to its solution is not just an obligation, it’s a privilege.

BDO New Zealand – measure, manage, guide

BDO New Zealand has measured its business-related greenhouse gas emissions for the year ending December 2023. Was this process useful? 

Doug Haines FCA, chair of BDO New Zealand, says: “We found the carbon emissions measurement process incredibly valuable. The biggest gains come from looking beyond the numbers – ever important for accountants. 

“Emissions reporting is about so much more than just a calculation. There are many emissions reporting frameworks and providers that can help with this – but what’s most important are the quality conversations and learnings that you have as a business. Measuring our national carbon footprint proved a powerful platform for stronger conversations across our 20 BDO New Zealand offices on our role in collaborating to minimise our impact on the planet. What’s more, we now find ourselves in a position to add further value in providing first-hand experience when advising businesses on their carbon emissions reporting.

“Tracking our emissions reinforced the value of continuing to refine necessary data collection processes… For example, to quantify our actual emissions through flights, it was key to ensure we had accurate reporting from our travel management providers. What’s great is we now have a further platform from which to set targets and strategies as a national network.” 

A key lesson? Haines advises: “It’s important for businesses to acknowledge that their first measurement is about setting a base year against which to monitor future progress.”