Moving an individual’s super funds away from fossil fuels is a growing trend in Australia, driven by concerns over climate change. However, entire organizations making this shift is less common. The Australian superannuation industry manages a significant $4.1 trillion of retirement savings globally, with over $150 billion potentially invested in companies contributing to climate change, prompting members to consider shifting their funds.
Leigh Read, who experienced the devastating impacts of natural disasters, decided to divest his superannuation savings from fossil fuels. Motivated by a desire to align his investments with his values, he also influenced his workplace, the Centre for Non-Violence, to make the switch to a more sustainable super fund. This move reflects a broader trend of workers advocating for climate-conscious investment options.
Employee climate advocate Laure Legros emphasizes the importance of divesting from companies that undermine a sustainable future. By targeting the financial backers of fossil fuel industries, such as super funds, individuals and organizations can drive significant change. Legros highlights the impact of collective action within workplaces, signaling a shift towards more responsible investment practices.
Two notable organizations, Amnesty International Australia and the Centre for Non-Violence, left super fund HESTA due to its continued investments in fossil fuels, particularly in Australian gas companies Santos and Woodside. This decision was supported by staff, management, and community board members, reflecting a growing awareness of the environmental implications of super fund investments.
HESTA, a major industry super fund, justifies its investments in fossil fuels as a means to influence company behavior from within. The fund asserts its commitment to net zero targets and engagement with companies like Woodside and Santos. However, environmental advocates question the efficacy of such engagements, as continuing to support fossil fuel expansion contradicts climate goals.
Market Forces’ Brett Morgan criticizes super funds for claiming alignment with climate goals while investing in fossil fuel projects. With a focus on sustainable finance, expert Gordon Noble warns that super funds risk losing members if they fail to address climate concerns effectively. He underscores the need for fossil fuel companies to transition their business models to remain profitable in a net zero world.
Despite the availability of sustainable investment options, an ABC investigation reveals that many super funds labeled as ethical or sustainable still invest significantly in industries like fossil fuels, gambling, and weapons manufacturing. As organizations seek to reduce their carbon footprint, default super funds may face scrutiny as part of broader sustainability strategies.
Leigh Read’s workplace, the Centre for Non-Violence, formalized its commitment to environmentally responsible investing by opting for a fossil-free default super fund. This decision, embedded in the organization’s enterprise agreement, reflects a proactive approach to aligning financial practices with climate values. By taking concrete steps to divest from fossil fuels, organizations like the Centre for Non-Violence are setting a precedent for ethical investment practices.
As the conversation around sustainable finance gains momentum, individuals and organizations are increasingly leveraging their influence to drive positive change in the superannuation industry. By advocating for divestment from fossil fuels and promoting climate-conscious investment strategies, they are reshaping the financial landscape towards a more sustainable future.
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