Retirement
Pension funds, members have 'crucial contribution' to fighting climate change
Retirement
Pension funds, members have 'crucial contribution' to fighting climate change
The World Wildlife Fund is calling on people saving for retirement to also consider saving the planet, arguing that there are consequences for where we place our money.

Pension funds, members have 'crucial contribution' to fighting climate change
The World Wildlife Fund is calling on people saving for retirement to also consider saving the planet, arguing that there are consequences for where we place our money.

Opining for the World Economic Forum, economist with the World Wildlife Fund’s (WWF) European policy office said there’s not enough awareness of how pension funds invest.
Sébastien Godinot explained: “What we spend money on has consequences. But while we are usually aware of what our own capital is used for, how about the money we put into pension funds, or to insurance companies?
“There are few requirements for pension funds and insurance companies - known as ‘asset owners’ - to reveal what they are investing in. And there is no obligation for them to ensure their investments are in sustainable sectors either.”
This could mean pension funds could be investing in coal, something he called a “highly polluting energy source and a slowing industry”, without users even knowing it.
“We believe that asset owners have a crucial contribution to make towards the Paris Agreement’s climate targets - keeping global temperature rise to well under 2 degrees and aiming for 1.5 degrees.
“After all, while climate change is primarily a terrible threat to our existence, it is also a major financial risk; USD7.2 trillion could be lost in value from financial portfolios globally by 2100 if no further action is undertaken on climate change,” added Mr Godinot.
Should asset owners, like pension funds, disclose all their investments?
The WWF economist said that asset owners should think about investing in renewable energy and the “green economy”, as opposed to sectors that have negative ties to climate change, like fossil fuel extraction.
Continuing, he argued that as growing industries with falling prices and consistent returns, wind and solar “offer a huge investment opportunity”.
However, Mr Godinot acknowledged that funds are already beginning to move away from polluters.
“Earlier this year, WWF published research based on data from 29 of Europe’s major asset owners, mainly pension funds. We found that nearly all of them had cut public equity funding to coal mining. However many of them were still investing in coal power and not focusing enough on the potential of renewable energy,” he said.
Nevertheless: “Those findings were only a fraction of the whole picture. We actually approached over 80 asset owners, many of whom agreed to test whether their investments are compatible with a scenario that keeps temperature rise below 2 degrees, as per the Paris Agreement.
“However, they were not obliged to disclose the results - and it’s this lack of mandatory disclosure that makes it challenging to hold asset owners accountable for their investments.”
Transparency is the first step in “bringing asset owners in line” with the Paris agreement. With this in mind, Mr Godinot said the EU should require that investors assess and publish how they align with the goals.
“Of course, asset owners can - and should - also lead the way, by assessing their climate alignment on a voluntary basis and disclosing the findings.
“Aligning investments with the Paris Agreement, studies show, is the best way for asset owners to safeguard the money and interests of their members and beneficiaries - over time, this is the surest way to better returns. Asset owners should acknowledge this officially and act upon it,” he said.
Mr Godinot called on asset owners to develop tools to create, align with and track the achievement of climate science-based targets and for shareholders to “push companies in their portfolio to adopt strategies in line with the Paris Agreement”.
“Doing all of this will help fight climate change and protect us from future climate-related costs, but it will also guarantee a better and safer return on investment.”

Superannuation
Why opt-in super proposal is a ‘secret tax’ on Aussie workers
A proposal to give workers the option to pick between a wage rise or a super contribution increase has been slammed by industry funds, branding it as “a secret tax” on workers. ...Read more

Superannuation
Early super access could be less than expected
Money accessed through the early release of super scheme looked to be coming in under the government’s revised expectations as the scheme drew to a close at the end of 2020. ...Read more

Superannuation
Proposed super reforms to rob millions of Australians
Australia’s largest union has rejected the government’s new super reforms on the basis it will leave members worse off long-term due to being “stapled” to a high-fee fund. ...Read more

Superannuation
ISA takes another shot at super reforms, accuses government of favouring big banks
Just a few days after hitting out at the government’s Your Future, Your Super scheme, ISA is at it again, signalling to the government that it may have a fight on its hands when it comes to this now...Read more

Superannuation
Royal commission reforms pass Parliament signaling more super oversight
The first bill implementing recommendations from Hayne’s banking royal commission has passed through the Parliament. ...Read more

Superannuation
Fears half of super system may be exempt from performance test
While the Your Future, Your Super measure has been a topic of debate for weeks over its ability to create possibly unintended consequences, new questions have emerged about the measure’s ability to ...Read more

Superannuation
AustralianSuper tops $200bn in assets, aims for mega fund title
AustalianSuper has become the country’s first fund to top $200 billion in assets despite the harsh economic conditions which saw Australia dive into its first recession in 30 years. ...Read more

Superannuation
Gender superannuation gap declines to 50%
Superannuation is becoming an increasingly important asset in households’ wealth portfolios, but a gap remains between males’ and females’ account balances, the recent HILDA survey found. ...Read more

Superannuation
Why opt-in super proposal is a ‘secret tax’ on Aussie workers
A proposal to give workers the option to pick between a wage rise or a super contribution increase has been slammed by industry funds, branding it as “a secret tax” on workers. ...Read more

Superannuation
Early super access could be less than expected
Money accessed through the early release of super scheme looked to be coming in under the government’s revised expectations as the scheme drew to a close at the end of 2020. ...Read more

Superannuation
Proposed super reforms to rob millions of Australians
Australia’s largest union has rejected the government’s new super reforms on the basis it will leave members worse off long-term due to being “stapled” to a high-fee fund. ...Read more

Superannuation
ISA takes another shot at super reforms, accuses government of favouring big banks
Just a few days after hitting out at the government’s Your Future, Your Super scheme, ISA is at it again, signalling to the government that it may have a fight on its hands when it comes to this now...Read more

Superannuation
Royal commission reforms pass Parliament signaling more super oversight
The first bill implementing recommendations from Hayne’s banking royal commission has passed through the Parliament. ...Read more

Superannuation
Fears half of super system may be exempt from performance test
While the Your Future, Your Super measure has been a topic of debate for weeks over its ability to create possibly unintended consequences, new questions have emerged about the measure’s ability to ...Read more

Superannuation
AustralianSuper tops $200bn in assets, aims for mega fund title
AustalianSuper has become the country’s first fund to top $200 billion in assets despite the harsh economic conditions which saw Australia dive into its first recession in 30 years. ...Read more

Superannuation
Gender superannuation gap declines to 50%
Superannuation is becoming an increasingly important asset in households’ wealth portfolios, but a gap remains between males’ and females’ account balances, the recent HILDA survey found. ...Read more