- Many of Australia's largest superannaution funds have been slammed for not living up to their public commitments.
- An analysis of the 50 biggest shows many have voted against policies relating to climate action, political transparency, and gender equality.
- The Australasian Centre for Corporate Responsibility (ACCR) which compiled the analysis said it put "into question the responsible investment practices of a large number of funds".
- Visit Business Insider Australia's homepage for more stories.
They may not always realise it, but Australians actually wield some serious sway over companies when it comes to their behaviour.
The nation's $3 trillion superannuation industry gives current and former workers a sizeable stake in businesses both at home and abroad, with funds voting on important policies governing things like climate action and workers' rights.
However, the 50 largest funds, managing $1.86 trillion of retirement savings, are overwhelmingly failing on those fronts, the latest analysis by the Australasian Centre for Corporate Responsibility (ACCR) shows.
"Just seven out of 50 funds have shown sustained support for shareholder proposals over three years, putting into question the responsible investment practices of a large number of funds," director of climate and environment Dan Gocher said in a statement.
That's despite many of them making public commitments to do better on things like sustainable investment.
By voting in favour of or against certain policies, funds can push companies to do better on issues from human rights and worker conditions to political influence and the environment.
"Proposals typically seek greater disclosure or a specific commitment from a company, such as emissions targets. These issues are relevant to super fund members and the society they live in and will retire into," Gocher said.
One of the issues central to the superannuation system is the fact funds are rarely required to reveal how they vote or even which companies they are invested in. In other words, Australian workers are compelled to give their retirement savings to a fund which in turn has almost no obligation to say what it does with it.
Of those that do, the record isn't exactly sparkling. That's even more true when it comes to Australian companies, with funds ironically boasting a better voting record overseas than locally.
"While the trend in support for proposals at Australian companies is on the rise, only one proposal (at Woodside Energy this year) has ever received majority support, suggesting that investors are relying on private engagement to achieve change," Gocher said.
Private engagement is the justification long-given by funds as to why they vote down proposals or remain invested in fossil fuel companies. The argument goes that either a proposal may be too narrow in scope, or that they want to push the company's board behind closed doors.
"While ACCR encourages that engagement, super funds must show their members that it actually does what it says on the box ... shareholder proposals are a vital tool in the options available to investors to affect change."
Here's how their public voting stacks up overall.*
Just seven of the largest funds have supported climate action policies more often than they've opposed them over the last three years. They are Local Government Super (75%), HESTA (73%), Vision Super (71%), Mercer (61%), NGS Super (58%), Macquarie (57%), VicSuper (53%), and Qantas Super (53%).
Many others meanwhile barely appeared to support any including IOOF and AMP (7%), Prime Super (8%) and EquipSuper (9%). Other notable funds that dragged their feet include REST (23%), HOSTPlus (23%), CommBank Group Super (25%) and Sunsuper (27%).
Gender pay equity
When it comes to paying men and women equally, the voting is just as uneven.
Local Government Super (100%) again had the best record, followed by CBus (82%), Vision Super (80%), AustralianSuper (78%), Qantas Super (74%), Macquarie (71%), Mercer (69%), HESTA (65%), VicSuper and (56%).
On the other side of the ledger, BT Financial Group (16%), EnergySuper (20%), Sunsuper (22), NGS Super (23%), First State Super (23%) all make up the bottom of the list.
The other major type of proposal analysed relates to how companies disclose their lobbying efforts to influence politicians, including political donations and election spending.
Proposals to be more transparent were supported again by many of the same funds which supported climate action and pay equity, including Mercer (93%), Local Government Super (93%), Macquarie (92%), HESTA (85%) and CareSuper (84%).
The stragglers were again BT Financial Group (21%), EnergySuper (23%) and Sunsuper (26%).
*funds with fewer than 10 votes disclosed have been excluded.
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