Date posted: 27/06/2022

How accountants can help combat climate change

Climate change can have the power to make us all feel overwhelmed. According to Deloitte Global’s 2021 Climate Check report, more than 80% of executives are concerned about the negative impacts of climate change. It’s an issue that’s having a significant financial impact on people and businesses globally.

So how can accountants use their skills to help create a positive impact? Lydia Tsen CA is a Senior Policy Advocate at Chartered Accountants Australia and New Zealand, where she supports advocacy efforts with respect to climate change, nature, modern slavery and other sustainability topics. 

In her role, Lydia has seen CAs making a change within their industries, along with the significant impact that climate change is having on businesses. Organisations cross-industry are increasingly utilising accountants to aid them in assessing risks and to help them determine how best to respond to these risks. 

“Climate change is going to, and is currently, presenting a risk to businesses that impacts their long-term resilience," Lydia says. “When an accountant steps in, they can help quantify that risk to illustrate the potential impact. Accountants can carry out scenario analysis to help businesses understand the risks and opportunities different responses might mean for the business.”

Lydia has found that many businesses are still developing their non-financial risk management function, and she considers that this is where accountants can play a role. Accountants have the skillset to help businesses and industries adapt to climate change sensitive policies and become more sustainable. 

“That's where an accountant steps in. They can connect up different pieces of information. They know where to find it. They know what’s needed to verify the collection processes of this information. That's why we need them.”

Lydia TsenThat's where an accountant steps in. They can connect up different pieces of information. They know where to find it. They know what’s needed to verify the collection processes of this information. That's why we need them.”

Climate change is not only transforming the way accountants use their skills, but the accounting industry itself. The role of an accountant is moving toward non-traditional roles and prompting conversation about climate and nature. 

“The conversation is shifting to non-financial areas that are important and businesses need to consider. It's going to just keep growing in that direction, and it won't just be climate change, it will be other non-financial areas like cyber security risk,” she says. 

“There are many CA’s in traditional finance roles who are having the conversation within their organisations about climate change. You don't necessarily need to be a CA in an environmentally focused consulting firm.” 

Lydia has seen perceptions about accountants shifting, thanks in part to the new generation of accountants. Climate change is an issue worrying at least 84% of young people worldwide, according to a survey by the University of Bath

“Students are starting to think about other topic areas that they're interested in from a risk management perspective and seeing what they can bring to the table, while completing their professional qualifications,” Lydia explains.

Reflecting on her own time at university, Lydia offers advice to tertiary students who are looking to make a sustainable difference with their accounting skills while they are still studying. “It’s important to start working towards understanding the many different aspects of a business. It’s all about starting to follow current events where you can and making meaningful connections with people that you meet along the way.”

Lydia advises that it’s important to get a holistic view of businesses when considering employment opportunities, especially when it comes to non-financial risks. “Understanding what are some non-financial matters that a business should take into account, for example their impact on climate, and the health and safety of their employees is helpful, especially when looking for work but also to show that you understand the context in which the business operates,” Lydia suggests. 

Lydia encourages students, graduates and accountants interested in helping the environment, to make a difference by simply starting a conversation. 

“I always tell people that sometimes it's hard to decide where and how to make conscious choices and it can be really difficult to implement everything you want to do, but if you just start with one thing that you can change like reading one article or talking to one person, that's genuinely how you can start to make a difference.”

Related read

Want to learn about how accountants can help create a more sustainable future? 

Read more