NGS Super has announced it is targeting a carbon neutral investment portfolio by 2030 as it believes integrating environmental, social and governance (ESG) factors and responsible investment provides members with better risk-adjusted returns.
The fund said retirement savings would be at risk if climate change was not acknowledged in investment portfolios with more immediate action.
NGS Super chief investment officer, Ben Squires, said: “We acknowledge that pursuing a carbon neutral target date of 2030 is ambitious, but we also believe a 2050 target is misaligned with the timeframes the scientific community has given in relation to stemming human-induced climate change.
“…divestment of some companies and stocks will be necessary to achieve our 2030 target, but first and foremost, we will use engagement to effect change, as well as seeking out positive investments in companies and businesses that are actively looking to transition to the low carbon economy. We have already started that journey.”
NGS noted that while it aimed to achieve carbon neutrality without purchasing carbon offsets, it might need to use offsets from time to time.
“Our focus will be on carbon reduction and investing in carbon positive assets or companies in areas such as clean energy infrastructure (wind and solar projects), storage infrastructure, or grid technology,” Squires said.
“We’ll access these opportunities in several ways, including investing in infrastructure or private equity funds, direct project-level investment, securitised bonds or equity, investing in green buildings, or funding the balance sheets of corporate developers in both debt and equity.”