Australia is on the cusp of becoming the world’s most influential middle power. Not in a generation. Not in a decade. In the next 18 months. 

For the first time in our history, Australia controls all the variables: the resources everyone needs, the climate leadership platform, and the capital to deploy at scale. 

Decisions made between now and COP31 in November 2026 will determine whether Australian organisations lead this transformation – or watch as competitors seize the prize. 

Three forces are converging to create this Australian moment.  

First: The Great Fragmentation 

Trump 2.0 has closed the book on post-WWII globalisation. Recent 30% tariffs on EU and Mexican imports follow blanket hikes of 15-20% on most US trading partners. Global growth will slow to 2.3% in 2025, the weakest since 2008.  

In this fractured world, Australia finds itself in an increasingly rare position: strategic optionality. While the US deploys tariffs indiscriminately – even against allies like Japan and South Korea – and China navigates mounting Western restrictions, Australia maintains functional relationships across both spheres. 

The reason is simple: resource dominance. Australia is the leading global supplier of iron ore, gold, uranium, lead, zinc, and rare earths, and holds top-five positions in nickel, cobalt, copper, and silver. These materials underpin clean energy, advanced manufacturing, and defence technology. As the world scrambles for secure supply, Australia wields major power leverage. 

Second: The Climate Leadership Vacuum 

Global climate leadership structure is fragmenting. The US has abandoned multilateral climate leadership. Europe talks big but can’t fund ambition while rearming. China’s green tech dominance is under pressure as Western nations unwind supply chains and reduce strategic dependence. 

Into this vacuum steps Australia. COP31 in Adelaide (confirmation is imminent) represents more than another climate summit – it’s a moment of reckoning. Do we want to play a major power role in driving the US$1.9 trillion global transition? Or merely supply its raw materials? Do we want to dig and build, or simply dig and ship? 

Success makes Australia the indispensable bridge between competing blocs – too valuable to sideline, too central to ignore. Failure confirms our relegation to second-rate commodity supplier while others create the value-added industries of the future.

Third: A $4 Trillion Capital Advantage 

Australia’s superannuation system represents a force multiplier few other nations can match. At $4.13 trillion, it ranks fourth globally despite Australia ranking 56th by population. Growing at twice the rate of its international peers, it could reach $13.5 trillion by 2045, overtaking Japan and Britain. 

To put that in perspective, this pool of capital is nearly 10% the size of the NYSE – the world’s largest stock exchange – despite Australia having less than 0.4% of the global population.  

As global capital markets fragment along geopolitical lines, Australia’s super funds offer something increasingly rare: a vast, patient, stable pool of democratic capital unencumbered by foreign policy constraints – a domestic alternative to the overseas investment that has traditionally dominated Australian infrastructure and energy projects. 

What This Means for Your Board

To seize this moment, influential Australian boards should be considering three strategic imperatives: 

First: Geopolitical Risk Integration

According to EY, just 30% of CEOs have visibility into their political risk exposure. As economic nationalism rises, this transforms capital fundamentals: costs rise as liquidity fragments, returns diminish as regulatory barriers shrink addressable markets, and risk increases as governments repatriate capital or nationalise assets in the ‘national interest’. 

Boards already stress-test for interest rates and currency fluctuations and should treat geopolitical risk the same way, embedding it into standard investment analysis and modelling scenarios around supply chain, market access, and capital flow disruption.

Second: Climate Positioning for COP31

COP31 represents unprecedented reputational exposure. When 30,000 delegates arrive in November 2026, they’ll scrutinise corporate climate credentials as intensively as government commitments. 

Companies relying on questionable offsets or vague net-zero commitments risk public exposure translating into market punishment – higher borrowing costs, restricted ESG fund access, and damaged partnership prospects. 

The critical test comes down to three questions: whether companies can explain their climate position credibly, understand their biggest emissions exposures, and determine how carbon constraints affect margins versus competitors. 

Third: Domestic Capital Deployment

Australian super funds offer structural advantages over global alternatives. Domestic funds price 11.7 basis points below offshore alternatives, while eliminating currency hedging and foreign approval processes. 

These institutions operate with long investment horizons, avoiding the short-term pressures often imposed by international investors. That makes them natural partners for infrastructure and energy transition projects that demand patient capital. Treasurer Chalmers’ recent acknowledgment of the “dual economic and foreign policy dimensions” of superannuation investment signals government support. 

Companies should benchmark super fund terms against existing funding costs and approach them with Australian-focused value propositions that leverage their domestic investment mandates. 

The 18-Month Window

About the Author

Luke Heilbuth is CEO of sustainability advisory firm BWD Strategic, and a former Australian diplomat.