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Super funds ‘going backwards’ on climate action: Report

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Market Forces has published a new report analysing the voting behaviour of major super funds on climate-related shareholder proposals.

Environmental activist group Market Forces has accused some of Australia’s top super funds of failing to back up their climate commitments with adequate action.

The group has analysed the voting behaviour of the largest 30 super funds in the country on climate-related shareholder proposals as part of a new report.

While the total number of climate-related shareholder proposals rose significantly last year, Market Forces said that super fund support for these proposals appeared to be in decline with 53 per cent of votes in favour in 2022, down from 56 per cent in both 2020 and 2021.

Commonwealth Bank Group Super, TelstraSuper, Hostplus, and Mine Super were all found to have failed to support 70 per cent or more of climate-related proposals put forward in 2022. In contrast, Vision Super and NGS Super supported more than 85 per cent of proposals.

“Super funds are going backwards on climate action at a time when they must be pulling out all the stops to bring companies into line with their climate commitments,” commented Brett Morgan, superannuation funds campaigner at Market Forces.

“Super funds have been telling their members for years they take climate action by voting at company annual general meetings, yet many funds are simply greenwashing while failing to support proposals for genuine emissions reduction.”

According to Market Forces, funds including TelstraSuper, Mine Super, and Australian Retirement Trust voted against climate proposals which received significant levels of support from other shareholders during 2022.

Overall, funds were found to be more likely to vote against climate action at companies with significant fossil fuel expansion plans which Market Forces considers to be “Climate Wreckers”, including Woodside Energy, Santos, and Whitehaven Coal.

The report observed a 23 per cent drop in support for climate action at these companies compared to the vote made by major super funds in 2021.

“Voting against the reckless fossil fuel expansion plans of companies like Woodside and Santos is essential for super funds with climate commitments, otherwise they are greenwashing,” Mr Morgan claimed.

“Super funds have the opportunity and the imperative to vote for climate action during the upcoming annual general meeting season and members will be watching.”

Market Forces suggested that the voting behaviour of super funds was at odds with their climate commitments, since 19 of the 30 funds analysed have publicly set targets to reach net zero portfolio emissions by 2050.

Last month, the group also accused AustralianSuper of a “clear-cut case of greenwashing” after the fund threw its support behind management at Woodside’s latest annual general meeting and upheld the re-election of a longstanding director.

At a recent regulator-hosted roundtable, top super fund executives highlighted a number of difficulties which could put them at risk of greenwashing.

Jon Bragg

Jon Bragg

Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.