First State Super will divest from thermal coal miners by October 2020, reduce emissions in its listed equity portfolio by 30 per cent by 2023, and advocate for “an economy-wide 45 per cent reduction in greenhouse gas emissions by 2030” as it attempts to protect the long-term interests of its members and their savings.
“It is essential that as a responsible owner super funds set strong, ambitious and transparent targets to deliver the kind of action we need now to prepare for a more prosperous and sustainable future,” said First State Super CEO Deanne Stewart. “We have seen over the past 10 years significant volatility in value of thermal coal miners, and increasingly insurance companies are signally their intent to exit this sector in response to medium-term climate-related risks.”
First State is the latest high-profile super fund to go green, following HESTA’s commitment last week to drop coal miners and reach net zero by 2050.
“Divestment from thermal coal mining is an important first step, but we recognise there is more to do; which is why we have committed to bold actions and real targets to shift the dial on climate change which will assist us to continue to deliver strong sustainable long-term returns to our members,” Ms Stewart said.
“The time for discussion and debate is over; we need to take the learnings of the past five years and drive meaningful action.”
First State is “actively investigating” investment opportunities, and has already taken a one-third stake in the $1.1 billion wind farm Snowtown 2 and recently completed investments in a “world-leading” tyre recycling organisation and a bottle-to-bottle recycling business.
“We believe renewable energy and new technology investments will deliver for our members and community in the long-term, so [we] are developing annual targets to increase our commitment in these areas,” said First State’s chief investment Damian Graham. “Over the past five years we have also delivered a comprehensive engagement strategy both individually and as part of collaborative initiatives such as Climate Action 100+.”
“Through this engagement we have achieved positive, lasting results and worked closely with companies to better understand and influence how they are preparing to transition to a low-carbon economy while ensuring the communities in which they operate are supported through this change.”
