Responsible investment and climate change
We are committed to investing responsibly and consider environmental, social and governance (ESG) issues for each of our investments. ESG factors are key drivers in the choice and management of our investments.
We offer the Sustainable Responsible Investment (SRI) balanced option for members who want to incorporate social and environmental values into their super investments and avoid some industries.
Climate change, the health of local ecosystems, pollution and waste management are some environmental factors that will have a significant effect on the environment, communities and economies of the world.
Climate change is a risk that must be considered in the long-term assessment of an investment, in particular, its ability to generate a satisfactory return into the future. Appropriate management of climate change risk will lead to better long-term outcomes for our members.
We support the objectives of the Paris Agreement, an internationally recognised agreement to commit to combat climate change and address the effect it has on the global environment. The objective of the Paris Agreement is to limit global temperature rise to below 2˚C and preferably 1.5˚C above pre-industrial levels by 2050.
We support the Task Force on Climate-Related Financial Disclosures (TCFD) which has developed a framework for financial organisations to improve their reporting of climate-related information to investors, lenders, insurers, and other stakeholders.
We assess the ESG commitments of external experts when they are selected, and as we work with them.
Our investment consultant, Whitehelm Capital, is a signatory to the United Nations backed Principles for Responsible Investing (UNPRI), a member of GRESB Infrastructure and a supporter of TCFD.
We work closely with Whitehelm Capital and investment managers to make sure ESG issues are considered across the broad investment portfolio, in both direct investments and investments through external professional investment managers.
Our Climate Change Policy commits us to:
- continue to take action to reduce our own emissions
- influence companies in which we invest to make climate change a key area of risk focus as part of good business practice to, in turn, ensure that those companies continue to perform at the highest level
- make investment decisions that have regard to the risks of climate change.
Health and safety, human rights, labour standards, workforce diversity and equal opportunity are some of the social factors considered in our investment analysis as part of our commitment to ESG and responsible investment.
Business behaviours can have social and societal impacts, which affect employees, customers, and other stakeholders as well as the image of the business. This can in turn affect its operations and overall value, determining how it delivers outcomes for our members.
The composition of boards of directors, how much executives are paid, risk management, transparency and market conduct are all governance factors.
Strong governance ensures that businesses address risks appropriately, leading to better business outcomes and better results for that business and its owners. These outcomes then have a positive outcome for our members.
We have governance structures in place to assess investment risks, such as the ESG Policy, our Risk Management Framework and oversight from the Board and its committees.
Our current investments
Working with Whitehelm Capital, we engaged independent climate risk experts to help us understand our Transition and Physical risks across all our equities portfolio and our property and infrastructure portfolio.
Sustainalytics is a global leader in ESG and corporate governance research and ratings. Using its carbon research, we conducted an assessment on our listed equities portfolio to better understand our carbon transition risks.
We use this data to consider the carbon footprint of our equities portfolio and how we compare to industry benchmarks.
Property and infrastructure
We asked climate risk experts, Moody’s (formerly Four Twenty Seven) to assess the physical risk of our property and infrastructure assets. We use this assessment to develop and strengthen climate risk mitigation strategies to protect the long-term investment objectives of our property and infrastructure assets.
Our other direct investments in Australia and around the world
313 Adelaide Street, Brisbane
We acquired a 100% stake in 313 Adelaide Street in December 2019. The building has a 5-star NABERS Energy Rating and 4-star NABERS Water rating. NABERS Energy Rating measures the efficiency of an office building and compares its energy consumption against a set of benchmarks developed using actual data. NABERS Water Rating looks at the amount of water used and recycled in a building.
Mortons Lane Wind Farm
We purchased of 100% of the issued equity of Mortons Lane Wind Farm located in Woodhouse, Victoria, resulting in this renewable infrastructure asset being proudly Australian owned. In operation since 2012, Mortons Lane Wind Farm generates approximately 63.69 GWh of clean electricity which is enough to power more than 12,738 households in Victoria and reduce up to 68,148 tonnes of CO2 annually*.
*Figures updated 2/7/2021 and sourced from mortonslanewindfarm.com.au
Headquartered in Oslo (Norway), Kinland AS provides high-quality properties for government-backed care services. This June, Kinland acquired an additional portfolio of 30 properties in Norway and Finland, including 19 preschools and 10 care properties. It now has 252 properties across Norway, Finland, Sweden, Poland and the Netherlands. Properties are leased to leading preschool operators on long-term triple-net contracts. Operators receive around 78–88% of preschool fees from municipalities, which are backed by the government, while the remaining fees are paid by parents.