Sustainability budgets as a vulnerable common resource

Imagine the annual budget of a Head of Sustainability (HoS) as a fragile common resource. The HoS reports to a CFO whose's ultimate mandate is to maximise profits. In most organisations, budgets are divided between profit-generating units and overhead units. Sustainability teams tend to sit in the latter category — meaning their budgets are constantly under scrutiny.

For the HoS, the challenge is clear: prove the function is not just a compliance overhead, but a generator of return on investment (ROI). That ROI can take many forms — lower operating costs from efficiency gains, greater climate resilience, stronger brand equity, improved staff retention — but it must be visible and defensible when they walk into the CFO’s office.

The reporting squeeze

Unfortunately, each year sustainability reporting requirements ratchet upward. In Australia, AASB S2 mandates not only emissions disclosure but also scenario analysis and transition planning. For many HoSs, this means an ever-greater share of their budget is swallowed by consultants just to keep the reporting machine running.

For the sake of argument, imagine an HoS spending 75% of their budget on consultants for data gathering, processing and compliance documentation — leaving just 25% for actual emissions-reduction projects. Unsurprisingly, those projects start with low-hanging fruit, which are quickly exhausted. Each year, the remaining opportunities are harder and more expensive to reach.

Enter the platforms

Recently, GHG data platforms have changed the game. By automating data collection, standardising methodologies, and streamlining reporting, they can cut that reporting burden dramatically. Perhaps now the HoS spends 40% on platform subscriptions, freeing 60% for higher-value work.

The benefit cascades:

• The HoS can invest more in genuine ROI — deeper decarbonisation, adaptation planning, and strategic risk reduction.

• Consultants can pivot from low-margin data wrangling to higher-value advisory work, drawing insights from structured, accessible datasets.

• The CFO sees a sustainability function delivering measurable business value, not just compliance paperwork.

The tragedy of the commons risk

But here’s the rub: if each actor in the ecosystem — CFOs, HoSs, consultants, platform providers — pursues their own short-term gain without regard for the shared resource (the sustainability budget), the system could collapse.

If platforms hoard data to lock in customers, consultants resist working with platform outputs, or CFOs cut budgets because short-term emissions progress looks flat, the HoS may be left without the means to deliver results. That creates a vicious cycle: no results → no perceived ROI → deeper cuts → eventual abandonment of net-zero commitments.

The tragedy of the commons here is not overfishing or overgrazing — it is over-consuming the HoS’s limited budget for narrow purposes, starving the investment needed for long-term decarbonisation.

Three possible guardrails

1. Open consultant access to structured platform data — so each actor can work to their strengths.

2. Standardised data formats across platforms to reduce friction and enable quicker, cheaper insights.

3. Industry forums where platforms, consultants, and HoSs share best practice, coordinate improvements, and present a united case to CFOs.

The cooperation problem

Of course, all three ideas face the same obstacle: actors see each other as competitors for the same pool of budget. The instinct is to hoard — data, clients, proprietary processes — rather than to share.

That’s why perhaps it’s time to borrow from the concept of coopetition (Brandenburger & Nalebuff, 1996): recognising the mutual benefit (or mutual risk of inaction), and forming both horizontal alliances between competitors and vertical partnerships between suppliers and clients.

The central question is:

Can we reframe the sustainability budget as a shared resource to be stewarded collaboratively — before the commons is depleted?