Green skills are the new CFO imperative
However, many organisations are underestimating the scale and complexity of the climate transition on their business and the risks of falling short.
A new report from RMIT Online and Deloitte Access Economics reveals that 43 per cent of surveyed businesses say they are unprepared for mandatory climate reporting starting this year, even though more than half (56 per cent) expect climate change to impact financial performance in the next decade.
The long-term costs of inaction are significant. The Australian Government's 2023 Intergenerational Report estimates that a four-degree rise in global temperatures could reduce national economic output by $423 billion over the next 40 years.
So, what's holding Australian organisations back from tackling the climate challenge more effectively?
A key constraint is workforce capability.
Rhiannon Yetsenga is Associate Director at Deloitte Access Economics
Nic Cola is Chief Executive Officer of RMIT Online
A significant number of Australian organisations lack the requisite skills and expertise needed to effectively tackle or report the climate challenge head-on.
Half of the businesses surveyed admit they are struggling to hire workers with the right capabilities to support their sustainability goals. The biggest shortfalls are in technical disciplines, such as engineering and science, as well as sustainability-related soft skills like climate literacy and systems-thinking.
While the need for green skills is growing, just one in three organisations are currently investing in green skills training for employees. The most commonly cited barriers include high training costs (61 per cent), and a lack of time (55 per cent).
This skills gap needs to be tackled head-on. The report estimates that by 2030, medium and large businesses in Australia will require an additional 1.02 million workers with green skills to meet the rising demand in emerging industries such as renewable energy. Without investment in these capabilities, businesses may fall behind in the climate transition and become increasingly vulnerable to its impacts.
Green skills will be critical across both new and existing roles. In emerging industries such as renewable energy, recycling and circular economy sectors new jobs will be created, including roles like biomass plant technicians and carbon footprint analysts. But traditional roles will also evolve. As this column has observed before, finance function workers — from accountants up to the CFO — are increasingly required to manage sustainability compliance, support emissions reporting, and analyse climate-related financial risks.
These shifts will ultimately redefine what it means to be 'job ready' in a low-carbon economy. But until this becomes the norm, employers are willing to recognise the growing value of green expertise with a higher pay packet.
The report found businesses will pay a 13 per cent wage premium, around $13,000 per year, for candidates with green skills in management and leadership positions. This represents a collective $1.7 billion opportunity.
This wage premium highlights more than just demand and reflects a broader shift in business priorities towards sustainability. This shift is exemplified by a regenerative business approach, which moves beyond reducing harm, aiming to generate net-positive impact for people and the planet. To help progress regenerative practices, RMIT's new Regenerative Futures Institute will offer courses on regenerative business models, value systems, and the circular economy.
Despite its potential to drive profitability, innovation and market differentiation, only 24 per cent of surveyed businesses are currently focused on this way of operating.
For CFOs, this shift presents a clear mandate to lead.
The finance function now plays a central role in climate-related financial disclosures, emissions reporting, and sustainable investment decisions. CFOs are uniquely positioned to embed sustainability into business strategy and risk management frameworks.
Doing so requires action. CFOs need to assess their organisation's current capability, identify key skills gaps, and align workforce development plans with evolving climate reporting obligations and long-term sustainability objectives.
Investing in green skills will not only prepare businesses for regulatory compliance, but also enable them to better respond to climate risk, unlock innovation, and build a competitive edge in the transition to a low-carbon economy.
As the pace of change accelerates, so too does the urgency to act.
Building a workforce fit for the future is no longer optional — it's a business imperative. And for CFOs, now is the time to lead.
Rhiannon Yetsenga is Associate Director at Deloitte Access Economics and Nic Cola is Chief Executive Officer of RMIT Online.
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Disclaimer
This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional adviser.
Deloitte shall not be responsible for any loss sustained by any person who relies on this publication.
About Deloitte
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee ('DTTL'), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. Please see www.deloitte.com/au to learn more.
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