If you were to ask Australian governments what keeps them awake at night, then climate change and Closing the Gap would surely rank as two of their biggest concerns. Right now, governments can address both issues simultaneously, and save themselves money in the long term.

How? By creating an environment that enables Aboriginal and Torres Strait Islander people to realise the huge economic potential of the Indigenous Estate.

Australia’s Indigenous Estate is made up of assets held by or for the benefit of Aboriginal and Torres Strait Islander people and includes tangible assets (such as lands and waters) as well as intangible assets (such as cultural and intellectual property rights, and environmental and biosciences practices). If the government established licensing or tax incentives to encourage corporations to genuinely partner with Traditional Owners to deliver renewable energy, they could support Aboriginal and Torres Strait Islander peoples’ desire for greater self-determination, while also moving the nation closer to our climate goals.

Of course, there’s a need to monitor and evaluate outcomes to ensure commitments are met, and the desired result is achieved, but the potential economic benefit is significant. Deloitte Access Economics has published a report that found that Closing the Gap would see governments across Australia experience a net gain of $11.9 billion, while the economy would see a boost of approximately $24 billion.

Such an approach needs a targeted policy response from government, as well as the application of an ESG lens. Let’s unpack this.

Why are the opportunities so significant?

Australia’s Indigenous Estate comprises more than 40% of Australia’s land mass (and up to 60% when you factor in currently unresolved land claims), therefore the scale of what we’re talking about is enormous. There’s a huge opportunity for Aboriginal and Torres Strait Islander landowners and rights holders to realise their ambitions for self-determination and to generate income streams that are independent of government which can be spent on what individuals and communities themselves deem to be important.

This requires investment from both the government and private sector to build the commercial and economic development capabilities of Indigenous communities. A positive by-product is that corporate Australia has an opportunity to satisfy their own goals and targets around Indigenous procurement and employment, and around social impact more broadly.

At the same time, the Indigenous Estate is a crucial part of the equation when it comes to climate change and achieving net zero.

You can’t expect to reduce national net carbon emissions without considering up to 60% of Australia’s geographical footprint, and the Indigenous Estate offers the chance to make real improvements to Australia’s carbon reduction strategy.

How, then, do we realise these opportunities?

ESG: A new name for ancient thinking

If the UN’s COP26 Climate Change Conference taught us anything, it’s that we must act urgently to prevent catastrophic climate change. However, we must also act respectfully. While there’s a climate deadline, there’s also a social imperative and any policy response must ensure it moves the dial toward net zero emissions and moves the social dial at the same time. In short, we need to remember the ‘S’ in ESG.

When it comes to environmental, social and governance issues (ESG), all three lenses are intrinsically linked. The only way to advance environmental and governance issues is via deep consideration of social factors, too. This is something Aboriginal and Torres Strait Islander cultures have understood for over 60,000 years. ESG is embedded in the world’s oldest continuing cultures and is just a new way of describing traditional ways of knowing, doing and being.

Practically speaking, what does this look like?

Policy to drive commercial development and promote self-empowerment

We’re at a unique moment in time when the interests of Aboriginal and Torres Strait Islander peoples are aligned with the interests of government and corporate Australia. There’s an opportunity to share the costs – and the significant benefits – of Closing the Gap. To join the dots, however, between the current opportunities around Closing the Gap and achieving net zero, there needs to be policy change.

We are advocating for a targeted policy response from the government to support Traditional Owners to realise their ambitions for self-determination and for respectful, fair commercial use of the Indigenous Estate.

Policy must:

• Address land tenure.
  For instance, native title holders should be able to decide the terms and conditions of development on their land and sea country, so they can be economic participants in any use of these assets to generate renewable energy or carbon credits.
• Accelerate development opportunities and realise the economic potential of the Indigenous Estate.
  This could include:
  • incentivising corporate behaviours, or steering capital, by adjusting policy levers to increase Indigenous procurement opportunities
  • encourage partnering with, or investing in, Indigenous businesses
  • specific tax incentives for organisations who successfully deliver positive social and economic impacts for Indigenous communities.

Policy must be comprehensive and address both tangible and intangible assets. It must also be coordinated across the Commonwealth, states and territories. And Indigenous peoples themselves must have a voice at this policy-setting table.

In this way, government policy can empower others to deliver on environmental and social goals. Corporations will be encouraged to adopt Closing the Gap as their genuine social objective, while Indigenous communities will have the policy structures and capital investment they need for self-determination.

This, in turn, allows Aboriginal and Torres Strait Island people to invest in their own priorities, and so in a self-determined way, invest in ways that can strengthen culture, and improve health, education and employment outcomes. The government, meanwhile, can leverage efficiencies driven by the private sector.

And all of this, while we work together towards net zero.

Targeted government policy is required to ensure the corporate sector’s current focus on ESG is directed towards positive outcomes for Aboriginal and Torres Strait Islander people, Australia, and the world.