Questioned over whether he agreed with superannuation minister Jane Hume that super funds should stick to making money rather than taking an active role in political debates, Aware Super chief investment officer Damian Graham said that protecting members’ interests was not a political matter.
“We divested from producers of thermal coal and the reason we did that is not ideological. The reason we did that is because we felt there were risks to the long-term earnings streams and that we should start to moderate the exposure to thermal coal in the portfolio. That’s done on an investment basis – it’s not done ideologically,” Mr Graham told a Bloomberg webinar, adding that the climate transition would also create opportunities to invest in assets that would outperform in a low-carbon future.
Ms Hume told funds to butt out in 2020, saying “some of these funds have got very big and very influential and they seem to forget their job isn’t to rebuild the economy or create jobs or reframe the climate debate” but was instead to maximise member returns. But Mr Graham signalled that Aware Super wasn’t going bring its engagement down any time soon.
“Members can rest assured that we are taking the responsibility seriously and engaging with organisations to ensure they are operating in a way that can maximise their positive impact and drive good long-term sustainable shareholder value,” Mr Graham said.
Superannuation funds were in the ESG spotlight last year after the Australian Council of Superannuation Investors (ACSI) took the lead in deposing a number of executives at AMP and Rio Tinto, while industry fund HESTA called for the government to be more proactive on climate change so as to encourage greater domestic investment.
