Industry superannuation funds HESTA and UniSuper both copped heat from their members on Wednesday, as academics and doctors picketed against their fossil fuels investments across Canberra and Melbourne.
The academics’ rally occurred at UniSuper-sponsored Universities Australia Conference in Canberra on Wednesday, as part of a Market Forces-led campaign to pressure the fund to align its investments with the Paris climate agreement.
Since its launch in January, more than 10,000 university staff were reported to pledge their support.
Meanwhile, a group of doctors with health professional climate activist group Healthy Futures stood outside HESTA's office in Melbourne to protest the fund's holdings across 19 energy companies, including Caltex, Santos and Whitehaven Coal. The group then secured a meeting with the fund, with Healthy Futures co-founder and co-ordinator Kate Lardner and another representative speaking to HESTA head of impact Mary Delahunty, but they walked away without reaching any agreements between the two parties.
In an open letter to HESTA chief executive Debby Blakey, Dr Lardner wrote that it is "unconscionable" for the fund to continue to invest hundreds of millions of dollars of health workers’ money into fossil fuels. She pointed to injuries and sicknesses such as asthma resulting from the bushfires, which are only expected to become more frequent with the rise of extreme weather events.
Dr Lardner said during the meeting with HESTA, Ms Delahunty defended HESTA's approach, saying engagement with companies was more effective than divestment.
"She said, 'We don't agree with divestment, that it changes anything, because we think if we take money out of these companies, someone else will invest in them,'" Dr Lardner said.
"So I said to Mary, that's fine, I don't mind whether we use engagement, I don't mind. You're saying we're on the same page, but in the next 12 months, can you bring back to us pledges from all of these 19 companies we want you to divest from, or remove money from, pledges from them saying they will commit to net zero emissions targets by 2030. And she said, 'No, I can't give you that guarantee.'
"So we ended without any target."
HESTA chief investment officer Sonya Sawtell-Rickson commented HESTA's best chance at managing long-term climate risk was to use its influence to drive companies towards reducing their carbon emissions.
“We believe that if all we do is simply sell these companies, it is very unlikely to change their behaviour and drive long-term climate action,” Ms Sawtell-Rickson said.
“Using the leverage ownership provides is more effective than divestment at achieving climate action and the transition to a low carbon future.”
She added that active ownership is producing significant results, pointing to the $50 billion fund’s work with BP.
“For example, by cooperating with other investors, we’ve successfully pushed for companies like BP to set emission-reduction targets and link these to executive pay,” Ms Sawtell-Rickson said.
“Last week, BP announced a commitment to have net-zero emissions by 2050. We believe this wouldn’t have occurred without sustained shareholder pressure. Divestment would mean we have no influence to encourage climate action and would limit our ability to protect members’ investments.”
But Dr Lardner noted BP was the only successful example HESTA had and it may be fallible.
"We know a lot of international pressure was put on BP to set a 2050 target, which is fantastic but BP also states on its website along the lines of this is a vision and we hope to one day achieve it, but we're not sure it will be a reality," she said.
"BP doesn't have interim targets. It doesn't have a plan to get there and it might not be possible."
'They're not listening to their members'
A number of other medical professional organisations have also written open letters in the past asking for fossil fuel divestment from HESTA and First State Super, including the Public Health Association of Australia, the Australian Health Promotion Association and the Doctors Reform Society.
Ultimately, Dr Lardner said, the only option left if pressure on HESTA fails may be to coordinate a mass move to an alternate fund.
"We need to go back to the drawing board," she commented.
"But the options will involve either just building numbers and building pressure that way in terms of turning out in front of the HESTA office with more and more numbers, or it will be just on mass moving to a different super fund.
"I know a lot of university students are wanting to pledge to HESTA that they will sign up to an ethical super or an alternate super fund if HESTA doesn't change. So it might be that we go down that path next and that's mainly because their membership base is saying that we have concerns, but they're not listening to their members."
UniSuper 'directly undermining our work': academics
UniSuper declined to comment on Wednesday’s rally, but similar to HESTA, a spokesperson has previously told Investor Daily that the fund prefers “engagement over divestment”, using its influence to push companies towards the Paris Agreement.
ANU research fellow Dr Florian Busch commented: “UniSuper is responsible for the retirement savings of Australia’s leading scientists, academics and researchers, yet it is directly undermining our work and our future by driving climate change through its continued funding of fossil fuels.”
Edith Cowan university lecturer Dr Lucy Hopkins commented that it is “astounding” that the fund’s members have “to go to such lengths” to have their voices heard.
“We don’t want our retirement dollars fueling the destruction of our planet,” Dr Hopkins said.
“However, we will do what it takes to make sure our savings are invested in a safe and clean future.”
UniSuper has not voted in favor of a climate change-related shareholder resolution in Australia for the past few years, based on its disclosed proxy votes between 2017 to 2019. In contrast, HESTA was seen to be one of the most supportive funds on climate proposals, according to findings from the Australasian Centre for Corporate Responsibility.
During that period, however, UniSuper did support 95 per cent of climate-related international proposals (18 out of 19 votes).
UniSuper, which manages $83 billion, is the default superannuation fund for Australian academics, scientists, researchers and university employees.
It publicly discloses its top 20 Australian and top 20 international shareholdings, much to the ire of activists, who want full transparency. The local list includes resources giants such as BHP Group, Woodside Petroleum and APA.
The fund has also reported that 12 per cent of its exposure is in companies involved with fossil fuels – which Market Forces has calculated to equate to around $10 billion of investment.
UniSuper does offer seven fossil fuel-free investment options, but Market Forces has previously slammed the “quarantined” alternatives, saying they represent a “tiny” proportion of assets and require opt-ins from members.
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
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