Mark McVeigh alleged that the $57 billion fund had breached its fiduciary duty to him by failing to consider climate change risks. The parties have now settled litigation, with Rest promising to strengthen its climate risk management processes.
“Rest will take further steps to ensure that investment managers take active steps to consider, measure and manage financial risks posed by climate change and other relevant ESG risks,” Rest said in a statement.
“As the trustee, Rest requires that compliance with these efforts be reported back to it and will use a variety of mechanisms to assess and, if necessary, take steps to improve, the compliance of its investment managers.”
The case was expected to set a precedent for how super funds – which are uniquely exposed to the impacts of climate change due to their long-term investment horizons and large investments in infrastructure and unlisted assets – would handle climate risk.
“Consistent with the Task Force on Climate-related Financial Disclosures (TCFD), Rest acknowledges that climate change could lead to catastrophic economic and social consequences and is an important concern of Rest’s members,” Rest said.
“The superannuation industry is a cornerstone of the Australian economy—an economy that is exposed to the financial, physical and transition impacts associated with climate change.”
