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Green tax breaks not enough for business

Businesses are looking at the fundamentals of demand for green initiatives from customers as political debate rages on the best way to reduce Australia’s carbon emissions, with a new report finding that consumer demand outweighs tax incentives as a key driver to operate a more sustainable business.

Over 250 businesses across Australia were analysed by the Grant Thornton International Business Report (IBR), a survey which investigates privately held business attitudes toward sustainable practices and their motivations for considering greener alternatives.

82% of Australian privately held businesses have identified consumer demand for green goods and services as a core reason for making their business more environmentally -friendly

Over 90% of respondents reporting that environmental credentials had no impact on whether they had won or lost customers over the past 12 months.

Although greater tax incentives to invest in R&D for the development of low carbo products or services (77%) and rising energy bills (71%) are considered key motivators, a high proportion of respondents still pointed to tenders demanding greener suppliers (69%) as a key factor in operating a more environmentally-friendly company.

Tony Markwell, National Head of Privately Held Business at Grant Thornton Australia, remarked:

“From the data we can see that the core challenge that our country faces is the lack of consumer pressure to encourage a change in business practices. However, there is still a responsibility on the part of business to account for their environmental impact and make the necessary changes to reduce this – the extent to which business can viably make these changes though will greatly depend on the policies proposed.”

In responding to the question “What would encourage you to operate a more environmentally-friendly/sustainable business?” businesses highlighted the following reasons for going green:

  • Consumer demand for green goods and services – 82%
  • Tax incentives to invest in R&D around developing low carbon products and services – 77%
  • Rising energy bills – 71%
  • Tenders from clients demanding greener suppliers – 69%
  • Greater tax incentives for installing renewable energy sources – 68%
  • Tax incentives to invest in energy-efficient equipment/technology – 53%
  • Free energy audits and expert advice – 10%
  • Just not a priority in the current downturn – 4%

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David Olsen

David Olsen

An undercover economist and a not so undercover geek. Politics, business and psychology nerd and anti-bandwagon jumper. Can be found on Twitter: <a href="http://www.twitter.com/DDsD">David Olsen - DDsD</a>

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