From Australia’s Royal Commission into misconduct in the Banking, Superannuation and Financial Services Industry to last week’s Productivity Commission report into the efficiency and competitiveness of Australia’s super industry, the spotlight is firmly on the ever-increasing $2.6 trillion superannuation sector and its enormous influence on the economy, environment and social landscape.

 

Making an important contribution to this conversation, RIAA launched its 2018 Super Fund Responsible Investment Benchmark Report last week.  This Report shows that Australia’s largest superannuation funds are ramping up their engagement in responsible investing efforts, particularly corporate engagement, to drive superior financial performance, reduce risk, and better meet their members’ and beneficiaries’ expectations. The Report, along with RIAA CEO Simon O’Connor’s opinion piece on ABC News, are essential reading for anyone who wants to understand the state of play with superannuation and responsible investment, and realise the myriad of opportunities that lie with deeper engagement in responsible investing.

NEW RIAA REPORT

Super Fund Responsible Investment Benchmark Report 2018

RIAA’s Super Fund Responsible Investment Benchmark Report 2018, the second in a series, presents the results of a survey of Australia’s 53 largest superannuation funds and asset owners (also including NZ Super Fund) and maps leading practice in responsible investment.

 

The 2018 Report, supported by Amundi Australia, finds that 81% of Australia’s largest super funds are committed to responsible investment (up from 70% in 2016), and 62% report annually on activity, highlighting how deeply responsible investing has become part of Australian investment markets. From backing shareholder resolutions demanding company disclosure on climate risk to divesting fromcompanies with poor governance or engaged in unethical activity, Australian super funds are increasingly flexing their muscle to influence better company behaviour.

 

However many funds still have much work to do in showing clients how their money is being invested on their behalf, such as disclosing full portfolio holdings. Another area for improvement lies in setting targets to measure and decarbonise portfolios consistent with science-based targets; up to a third of trustee boards are also still not actively considering climate risk in the face of increasing materiality.

 

Read the Report here.

IN THE MEDIA

Australian superannuation funds can wield their financial muscle responsibly

 

Super funds are facing ever more questions to answer on their delivery of outcomes for members. While a focus on the performance of funds is spot on, there is another outcome that increasing numbers of Australians are also concerned about — whether their super is delivering the type of Australia they want to live in and leave behind.

 

RIAA CEO Simon O’Connor’s opinion piece for ABC News here.

SAVE THE DATE

Webinar – How is Australia’s superannuation sector engaging in responsible investment?

Thursday 21 June, 12.00-1.00pm AEST

Join RIAA CEO Simon O’Connor and representatives from leading super funds First State Super and New Zealand Super Fund for a webinar to unpack the key finds from the Super Fund Responsible Investment Benchmark Report 2018.  RIAA members only.

Register here

 

Webinar – Why animal welfare matters to investors and what to do about it

Thursday 28 June, 12.00 – 1.00pm AEST

RIAA’s consumer research (November 2017) put animal cruelty as the top bad thing that Australians wish to avoid in their investments. Join Ben Pearson from World Animal Protection and Tim Vasudeva from Animals Australia to hear about how live exports campaigns and BB4 can help improve investor decision making. RIAA members only.

Register here

 

Webinar – Investing for the Sustainable Development Goals (SDGs)
Tuesday 10 July, 4.00-5.30pm AEST

The 17 SDGs provide a powerful unifying framework for tackling local and global challenges. Join us for this webinar hosted by RIAA’s Impact Investment Forum, where local and international investment, banking and corporate leaders explore their integration of the SDGs and approaches for embedding the SDGs within business and investment frameworks.

Register here

 

Benchmarking Impact 2018 report launch

Thursday 19 July, Melbourne

If you are interested in attending, please contact Carly Hammond

 

Webinar – Certification Quarterly

Thursday 31 July, 12.30-1.30pm AEST

RIAA’s Certification Quarterly webinar showcases newly certified responsible investment products. RIAA members only.

Register here

 

Human Rights Working Group

Wednesday 22 August

 

RI New Zealand 2018 Conference

18 September, Auckland

This full-day event brings together New Zealand’s responsible investment community and is not to be missed.

 

RI Australia 2018 Conference: Re-thinking Purpose in Finance

31 October & 1 November, Melbourne

The annual gathering for the community of responsible, ethical and impact investors in Australia; this is RIAA’s flagship event.

 

Sponsorship opportunities for both events as well as our Responsible Investment Benchmark Reports are still available – contact joshe@repsonsibleinvestment.orgif you’re interested.

HUMAN RIGHTS WORKING GROUP

RIAA’s Human Rights Working Group met for a second time this year in May, welcomed five new members and agreed the work plan for 2018. The 2018 work plan contains six work-streams:

  • Investors statement – led by Stuart Wilson, Sunsuper
  • Investor toolkit – led by Mans Carlsson-Sweeny, Ausbil
  • Workforce Disclosure Initiative – led by Liza McDonald, First State Super
  • NGO collaboration – led by Ella McKinley, Australian Ethical
  • Knowledge hub – led by Mark Lyster (Chair), Action Sustainability
  • Stock watch – led by Nina Haysler, CAER

 

Since the last meeting a number of members signed on to the Know the Chain Investor Statementco-sponsored by Investor Alliance on HR, the Interfaith Center on Corporate Responsibility (US). The statement outlines the expectations of investee companies by investors with respect to eradicating forced labour (aligned with SDG 8.7). Thank you to Matthew Moore of United Financial Services for coordinating local support.

CORPORATE ENGAGEMENT WORKING GROUP

Recent meetings of RIAA’s Corporate Engagement Working Group included discussion on the outcomes of the recent AGM season and the significant results of the numerous shareholder resolutions. The strong voting in support of these resolutions signals a shift in responsible investor expectations of companies, and a greater willingness of members to escalate engagement activities to their voting activities.  More than ever, we are seeing the direct outcomes on ESG matters achieved through a combination of voting and constructive engagement with many ASX listed companies on issues relating to lobbying of trade associations, climate risk disclosure, REM, and other governance matters.

 

Recent reports of note relevant to members’ engagement activities include a PRI report on active ownership, giving a good sense of the stages of engagement, escalation and accountabilities, as well as the first report of the Workforce Disclosure Initiative, an initiative being driven by ShareAction that RIAA is looking to partner with to bring greater Australian coverage.

IMPACT INVESTMENT FORUM NEWS

There was good news for impact investment in the 2018-19 Federal Budget with $6.7 million provided over four years to build the capacity of the sector, with a focus on outcomes measurement.  It is encouraging to see the Australian Government recognising the role it can play in enabling and developing the market, and RIAA looks forward to engaging with the Government to inform this work.

 

This week the Global Impact Investment Network launched its Annual Impact Investor Survey 2018, where 226 respondents report US$228 billion in impact investing assets under management. The report highlights a diverse and growing industry with a strong commitment to managing and measuring impact.  A must read for all active and budding impact investors. Toniic, a global community for family offices, foundations and high net worth individuals engaged in impact investing, also launched an important new study of portfolios in its 100% Impact Network, compiling data from 76 private portfolios totalling US$2.8 billion in committed capital.

 

If you’re interested to better understand the potential of investment to help attain the 17 Sustainable Development Goals, join RIAA’s webinar on Tuesday 10 July featuring Dutch pension fund PGGM and other investment, business and impact measurement leaders.   For an overview of the state of play in Australia with business and investor engagement around the SDGs, read the piece from RIAA’s Impact Investment Forum Program Manager Carly Hammond: The SDGs: a compass for investors with the future in mind.

MEMBER PROFILE - NZ SUPER FUND

New Zealand Super Fund is New Zealand’s sovereign wealth fund, established to help finance superannuation for future tax payers. The NZ Super Fund is globally recognised as a leader in responsible investment, driven by the belief that responsible investing is good for the portfolio, a source of opportunities and a way to control risk.  It is also one of 13 leading RI super funds recognised for articulating leading practice in RI, as revealed in RIAA’s Super Fund Responsible Investment Benchmark Report 2018 launched last week.

 

In this edition of RIAA Window we hear from Anne-Maree O’Connor, Head of Responsible Investment, about the fund’s approach, achievements to date and eye to the future.

NEW MEMBERS

RIAA’s membership continues to grow and we now have over 220 members today who combined, manage over $9 trillion in assets globally.  We welcome our newest members:

 

  • Adam Carey (Financial Adviser)
  • BNP Paribas Asset Management
  • Crescent Wealth
  • Elaine Prior
  • Legg Mason Asset Management Australia
  • New Ground Capital
  • Tim Fitzpatrick (Financial Adviser)

 

Interested in joining RIAA? See our membership guide here, or info@responsibleinvestment.org

NEW RIAA CERTIFICATIONS

As at May 2018, RIAA’s RI Certification Program boasts 150 investment options from 45 providers, as well as 22 financial advisers and two dealer groups, across Australia and New Zealand.

 

The following product has been updated for the Certification Program:

 

You can find the full list and more detailed information about each certified product and fund at Responsible Returns, RIAA’s dedicated consumer portal for finding certified responsible investment opportunities.

MEMBER MUSINGS - STEWART INVESTORS

Is it time for investors to quit sugar?

31 countries have imposed a tax on sugar to tackle the worldwide epidemic of obesity – and investors need to start taking notice, says Sujaya Desai from Stewart Investors.

Read more.

 

If you are a RIAA member with a topic you’d be interested in writing on for Member Musings please get in touch here.

MEMBER AND OTHER EVENTS

GRESB Sustainablity Real Estate

26 June, Sydney

The GRESB | Siemens: 2018 Sustainable Real Assets Conference series connects global asset owners, managers, operators and ESG professionals committed to creating sustainable and resilient buildings and infrastructure. GRESB is kindly offering the RIAA community a 20% discount (discount code:  SRAC20)

More information

 

UNEP FI Conference on Financing for a Sustainable Economy in Australia & New Zealand

23-24 July, Sydney

This agenda-setting event, supported by UNEP FI members, IAG, NAB and RIAA, will explore the potential for sustainable finance to shape a resilient and sustainable economy in Australia and New Zealand.

Register your interest here

 

 

Impact Investment Summit Asia Pacific

13-15 November, Sydney

More information

If you have anything you would like to share with the team at RIAA, or you would like to include in the RIAA Window, then send it to us at info@responsibleinvestment.org

We’d love to hear from you.

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