Australian Ethical Super, Christian Super and Local Government Super (LGS) are the first three super funds to attain certification under the Responsible Investment Association of Australasia’s (RIAA’s) new whole of superannuation fund responsible investment category.
RIAA relaunched its Responsible Investment Certification Program on Monday – a tool designed to help consumers and financial advisers navigate towards the growing range of responsible investment options – and has for the first time included a dedicated category for super funds.
To attain certification these super funds had to demonstrate leading practices in integrating responsible investment across their entire fund, specifically: applying at least two responsible investment strategies across the fund, with at least 75 per cent of the assets under management under clearly defined responsible investment strategies; disclosing their full portfolio holdings; systematically applying other active ownership strategies including engagement and proxy voting; and actively contributing to advocating for more responsible financial markets.
Simon O’Connor, chief executive of RIAA, said that responsible investing needed to not just occur in domestic equities, but across the portfolio, in international equities, fixed interest, property and even cash.
He added he did not anticipate many super funds being able to meet the conditions.
“We purposefully set a very high bar, so only those funds which have very deeply embedded responsible investing practices would be able to meet these requirements,” O’Connor said.
The super funds also had to agree to an audit process to verify these details, with Grant Thornton and KPMG carrying out reviews on behalf on the RIAA.
Tim Macready, chief investment officer at Christian Super, said: “RIAA’s Responsible Investment Certification is a valuable recognition of the work that our fund does to achieve good outcomes for members using ethical and sustainable decision-making principles and processes.
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“We are privileged to be able to manage our members’ money in accordance with Biblical principles so that their superannuation can change the world for the better.”
LGS chief executive officer, Peter Lambert, said the $9 billion fund was pleased to receive this certification as further independent recognition of the super fund’s leadership in sustainable and responsible investing.
Australian Ethical chief executive Phil Vernon added: “A rapidly growing number of Australians are using their choice of super to advance both a sustainable future and their best financial interests. RIAA’s certification program helps investors make that important choice, and we value their recognition of Australian Ethical’s leadership in investing for people, the planet and our members.”