By Karen Silk
Business has a key role to play in reducing climate change.
In coming years business-driven consumer technologies like electric vehicles, solar, battery storage and artificial intelligence software have the potential to slash our environmental footprint.
In New Zealand forestry will also play a key role.
But to drive the innovation, scale and new service models that will maximise benefits, investment is required and we're not talking loose change, but rather billions of dollars.
The good news is there are plenty of investment dollars looking for a home.
The bad news is that until we have more certainty around the short-term path to long-term goals, like those set under the Paris agreement, then much of that money will remain on the sidelines.
That's why the Parliamentary Commissioner for the Environment's report exploring whether the UK's Climate Change Act and independent commission could work in New Zealand warrants serious consideration by those in the Beehive after September 23.
The report is an excellent starting point on the pros and cons from a New Zealand perspective.
Crucial to the whole idea is setting climate goals in law - NZ's existing long-term goal is to reduce emissions by 50 per cent below 1990 levels by 2050.
The independent commission would then set a clear pathway to get there, including five-year targets, monitoring and commentary on performance.
The overall objective of this long-term approach is delivering results at the lowest possible cost to the economy.
From a business and investment perspective there would be several positives about this:
• Setting five-year targets and realistic plans to achieve them would allow nearer-term forecasting into likely price signals and the sort of investment required into relevant NZ industries to reach the target.
• Monitoring and commentary would provide greater transparency and debate around progress and policy options, giving investors far greater information on which to base decisions.
• Putting NZ's climate goal in law would itself show Government commitment which would create greater investment certainty.
• If the target had cross-party support - as is the case in the UK - this would create even greater certainty.
These factors combined would create far greater clarity for investors on risks and opportunities and greater comfort that the rug was not going to be pulled out from under their investment by unexpected changes in Government policy.
Interestingly, Lobby group Generation Zero has put up a similar proposal but with a more ambitious climate goal - net zero emissions by 2050 - which has garnered a range of cross-party support, including from National's Young Nats.
None of these proposals are a magic wand.
Locking a target into law and reporting on progress won't change the complexity of the issues, or the trade-offs that need to be made, but it would put a focus on having these tough policy debates at a more granular level and not allowing things to drift.
In the UK there has been good evidence of progress as a result of the regime, which enjoys bipartisan support.
Nine other countries have since put in place similar laws.
Key success factors for such a model to work include a good mix of skills on the commission, for example a strong base in science and economics, good leadership to ensure it is not captured by personal agendas and a mixture of pragmatism, flexibility and challenge.
In the past 18 months the Government has taken several positive steps on climate change.
It has signed up to ambitious Paris climate goals, it has removed two for one subsidies for New Zealand's largest emitters, it has just announced changes that will improve the effectiveness of the Emissions Trading Scheme and it has asked the Productivity Commission to look into the biggest impact-lowest cost policy responses to climate change.
All of these steps show commitment and are to be applauded, as are our MPs' steps to form Globe NZ - a cross-party group committed to action on climate change that includes members of the Greens, National and Labour.
However the next step on this journey for New Zealand is to think about how we translate long-term aspiration into short-term goals and how we put in place a long-term policy framework around climate change that gives businesses the certainty to invest.
Further investigating a UK-style Climate Act and independent commission would be a step in the right direction, alongside building the cross-party support to lock in certainty.
If we can get the investment environment right then business will deliver the solutions to meet our climate goals.
Karen Silk is the chair of Business NZ climate leaders group and is general manager of commercial, corporate and institutional banking at Westpac NZ.