Looking under the hood of the default investment options of Australia’s top 30 super funds has revealed funds have been scaling back holdings in the two ASX 300 companies, relative to the Australian stock market.
Research by Market Forces, based on funds’ mandatory disclosures, found that funds have, on average, reduced their holdings in Woodside by 0.30 percentage points against the company’s weight in the ASX 300, a reduction equivalent to some 10 per cent of Woodside’s market share.
A similar trend was seen regarding Santos, with funds reducing these holdings by 0.13 percentage points, a reduction equivalent to some 11 per cent of Santos’ market share.
“Australia’s largest super funds are turning their backs on Woodside and Santos as more members demand greater climate action,” observed Brett Morgan, superannuation funds campaigner at Market Forces.
“Super funds must demand and deliver an end to Woodside and Santos’ oil and gas expansion plans and publicly divest if they fail to comply.”
Per the analysis, $36-billion-fund ESSSuper’s growth option holds some of the highest investment exposures to Woodside and Santos, compared with the ASX 300 benchmark as of 30 June 2023, at 1.47 per cent and 3.05 per cent, respectively.
The balanced option of Australia’s largest super fund, $300-billion AustralianSuper, was named among the top funds holding Woodside (1.69 per cent above the benchmark weight), alongside AMP’s MySuper 1970s option (0.65 per cent).
Meanwhile, Hostplus’ balanced option and Equip Super’s MySuper option held 1.64 per cent and 1.41 per cent in Santos, respectively.
According to Market Forces, all 30 funds are committed to active ownership as a strategy for addressing ESG issues, including climate risk, and 29 of the 30 acknowledge climate change as a significant risk or have set an emissions reduction target.
“Australian super funds have a crucial opportunity in April to vote against the re-election of directors at Santos and Woodside and their remuneration arrangements and must take this opportunity or face scrutiny for greenwashing,” Morgan added.
He urged funds to “stop the greenwash” by engaging with Santos and Woodside against new oil and gas projects.
“A groundswell of members want to see their super fund sparing no effort to end Santos and Woodside’s oil and gas expansion plans, and divesting if these companies fail to step into line,” he said.
