Carbon tax will encourage 'sustainable' superannuation funds: SuperRatings

A change of government would hinder the superannuation industry's moves toward operating sustainably, according to the 2012 SuperRatings Fund Sustainability Review.

The report said the carbon tax (which the opposition vowed to abolish if elected) is expected to encourage more 'sustainable' super funds - an ideal the majority of respondents believe is their responsibility. 

While 80 per cent of respondents said they have a responsibility to act sustainably, only 20-30 per cent regularly measured and reported energy, waste, and water usage.

However, the review said those funds which are sustainably undertaking a number of measures and increasing their commitment to the cause have increased investment into green buildings by 9 per cent and investment in clean technology by 7 per cent, from 2009 to 2011.

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SuperRatings managing director Jeff Bresnahan said superannuation is not too far removed from sustainability, "ensuring future through actions in the present".

He said an increasing proportion of funds claim to have 21-25 per cent of total net assets in socially responsible investments, but as an industry they could do more.

Sixty-nine per cent of respondents said they are adopting sustainable investment practices to reduce environmental and sustainable governance (ESG) risk, and 41 per cent in response to government policies, while 42 per cent said they employ an ESG integration overlay approach to sustainable investment.

In the long-term, seventy per cent of respondents believe climate change will affect their investment decisions and how they operate.

SuperRatings has crowned Local Government Super as the Infinity Award winner for 2012, citing a 94 per cent increase in their responsible investment assets to $3.3 billion, and acknowledging their focus on healthy environments, social cohesion and good governance of the companies in which it invests.