Electoral reform failure: How the fossil fuel industry influences our elections

The recent backroom deal on political spending reforms struck between Labor and the Coalition has laid bare the entrenched influence of corporate power in Australian politics. While the legislation does improve transparency, it also fortifies the dominance of the two major parties, putting minor parties and independents – who are often our strongest advocates for climate action – at a disadvantage. 

A ‘permission slip’ for fossil fuel giants 

The bill, which was supposed to limit the corrosive impact of big money in politics, has included a carve out of special exemptions for corporate interests. Among the most concerning is the amendment allowing peak bodies like the Minerals Council of Australia (MCA) and the Business Council of Australia (BCA) to spend up to $200,000 on national elections –four times the cap imposed on other entities. Both the Minerals and Business Councils are funded by their corporate membership fees, meaning their spending effectively amplifies the voices of fossil fuel giants and other corporate interests over those of everyday Australians.

The Minerals Council of Australia spends big to influence elections 

We need big money out of politics across the board, but getting these reforms right is nowhere more important than in relation to the fossil fuel industry. For over 50 years, the fossil fuel industry has known that burning coal, oil, and gas drives climate change and would have devastating impacts to communities, our food systems and the ecosystems on which we rely. Yet, rather than transitioning to cleaner energy, the industry has doubled down on lobbying to delay, weaken, or block climate policies. 

The MCA, representing a relatively small but politically powerful segment of our economy, has been at the forefront of this campaign in Australia. A 2020 report by InfluenceMap found that the MCA had “the single largest negative influence on Australian climate-related policy.” This is no surprise given its track record. In 2010, the MCA spent over $15 million on advertising to oppose the Minerals Resource Rent Tax and the Resources Super Profits Tax. 

More recently, the MCA has been running a pro-nuclear energy campaign, spending tens of thousands of dollars in February alone on Facebook and Instagram, reaching upwards of 1.6 million Australians. This campaign aligns with the Coalition’s push for nuclear energy –a policy widely criticised as scientifically and economically unviable –while undermining investor confidence in renewable energy.

The MCA’s influence is so pervasive that even its own members have pushed back. In 2017, BHP issued an ultimatum to the MCA, demanding it stop lobbying for new coal-fired power stations or risk losing BHP as a member. The mining giant also ousted a previous MCA chief executive over his advocacy for “clean coal.” These internal tensions highlight the disconnect between the MCA’s aggressive pro-fossil fuel agenda and the Australian public, as well as among some of the industry’s biggest players who understand the future lies in renewable energy.

Yet, despite these cracks, the MCA remains a formidable force in Australian politics. Its ability to outspend charities and other organisations on elections ensures that its voice will continue to drown out those calling for urgent climate action. This is not just a problem for the environment – it’s a problem for democracy. When corporations are given more political power than citizens, the result is a system that prioritises profit over people and short-term gains over long-term survival.

We need to stamp out corporate influence

The stakes could not be higher. Last year, the world recorded its highest-ever greenhouse gas emissions, even as we experienced record-breaking heatwaves, wildfires, and floods. The science is clear: we must rapidly phase out fossil fuels to avoid catastrophic climate impacts. Yet, as long as the fossil fuel industry retains its influence on Australian politics, meaningful action will remain out of reach.

So, what’s to be done? The bill needs to be reformed under the next government to level the playing field between minor parties, independents and the majors and close the loopholes that allow corporate influence of our politics to flourish. And finally, we need greater regulation and accountability of corporations around their greenwashing and lobbying activities, including and especially by their industry bodies. 

Further reading: A recent Climate Integrity report highlighted the legal risks companies face when their stated climate goals conflict with the actions of their industry associations.