The 2023 election has come and (largely) gone. While the final makeup of the incoming government is still being decided, most commentators aren’t expecting a significant change in governmental priorities anytime soon.
Partly that’s due to the very real fiscal challenges the incoming government will face. There isn’t a lot of spare cash lying around. Nor, despite some of the more hyperbolic pre-election statements by a couple of the parties, is there much risk of significant cuts. Moves to reduce consultancy spend were already underway.
The other factor in play is that New Zealand governments have tended to be relatively centrist. Any reader who did the online Vote Compass quiz will have noted just how close the National and Labour policies are. Also, any National-Act-NZ First government will likely see tradeoffs between Act’s libertarian approach and NZ First’s protectionist instincts.
Perhaps the best reaction was that of the NZ sharemarket on the Monday following the election, a modest 0.7% down and even that was largely due to negative news from Fletcher Building.
So, what about sustainability? Won’t a National-Act government roll back many recent initiatives, such as ones to reduce or eliminate measures to counter carbon emissions? Undoubtedly the focus on sustainability that a Labour-Green government would have had, won’t be there, but the news isn’t all doom and gloom. For example, the clean car rebate is almost certainly history but National – the dominant partner – has shown no desire to relitigate the Emissions Trading Scheme it signed up to. The bigger issue is the warming of the planet won’t wait, so action isn’t stopped, merely delayed – and more drastic action may be needed by then. Our major trading partners may simply force the NZ government to adopt increasingly stringent climate change policies whether they like it or not.
And what governments decide is increasingly irrelevant. Consumers are voting with their dollars, taking a more sustainable approach. And the corporate sector, taking its lead from overseas, is getting on with becoming more sustainable – they know it just makes good business sense. A cursory look at the Sustainable Business Council membership – of which we are a recent and proud member – bears this out.
Murkier is the ’S’ in ESG (environment, social, governance). What markets fail to take into account, of course, is the impact of change on policies that benefit the disadvantaged. We hope the incoming government takes the opportunity to reassess some of its constituent parties’ more extreme statements.
