Wind farm

Sustainable economy

A sustainable economy is one which:

  • lives within its means: the economy as a whole spends the ‘income’ from natural assets rather than depleting the assets themselves – using no more resources than the environment can replenish; and
  • leaves a legacy, not a liability: pollution is limited to a level that the environment can absorb without ongoing damage to its function and health.

A better outcome for all

This kind of economy isn’t hard to imagine. Underpinning its appeal is the comfort of knowing that the way we work from day to day can be sustained from decade to decade; the joy of leaving our children bigger forests, healthier rivers, oceans and soils, cleaner air, and a more secure future than the one we inherited; and the pride of showing the world that it is possible to eliminate environmental damage and improve our quality of life at the same time.

Australia’s unsustainable economy

Australia’s economy is one of the least sustainable in the world – we have an ecological footprint 2.8 times the world average. Cheap coal and a reliance on petroleum fuels for transport mean our domestic energy system is highly carbon- intensive. Our carbon emissions per capita are nearly twice the OECD average and four times the world average.

Australia is the only country in the G20 that since 1995 has become less able to compete in a low-carbon economy. As resource prices rise, resource productivity will be increasingly important– countries that can produce the same economic value using fewer resources will be in a better position. Australia’s resource productivity is half the OECD average.

GDP paints an incomplete picture

Gross domestic product does not give a reliable picture of Australia’s long-term economic health, and it can be a misleading measure of social wellbeing. Among its flaws, GDP does not account for changes in ecosystems, the depletion of mineral resources or the value of voluntary work.

Our environment is overexploited and underpriced. We are already using 1.3 to 1.5 times more resources each year than it can sustain – depleting fish, forests and other resources and accumulating waste.


The solution is to create an economy that can feed, clothe, house and employ Australians without polluting and depleting air, water and soil. We need to shift the focus of Australia’s economic management from expanding the quantity of stuff we make and consume to one that flourishes within the boundaries set by nature.

To make a rapid transition to a sustainable economy, Australia needs to:

  • account for our natural assets – price what we can measure, value what we can’t
  • shift resources from polluters to problem solvers
  • introduce policies to help each sector of the economy rapidly adjust to environmental limits.
Need help deciding what to fund?

The AEGN Sustainable Economy Funding Table explores funding at a more detailed level, presenting funding ideas for a variety of funding amounts, ranging from small grants to large grants. It uses the different approaches you can fund which are taken from AEGN’s Giving Green: A Guide to Environmental Grantmaking. The Table helps you hone in on the specific type or types of projects that you can fund.

Download the pdf icon Sustainable Economy Funding Table (PDF).

Looking for more information?

Download our pdf icon Giving Green Briefing Note – Sustainable economy, which tackles the issue in more depth. To receive a hard copy, email

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