“Many Australians don’t realise their superannuation savings – worth A$4.5 trillion and growing – may be invested in fossil fuel companies, gambling, or even weapons manufacturers.”

“The latest official superannuation statistics show most of Australia’s major super funds now offer investments designed to reduce exposure to everything from coal and oil to other industries like tobacco, weapons, gambling and alcohol.”

“A few funds, such as Australian Ethical and Future Super, only offer sustainable options, with tighter investment restrictions than most super funds.”

“In Australian Ethical’s case, weapons makers and tobacco producers are excluded outright. But a diversified company earning a small share of revenue from fossil fuels or alcohol may still be held, if its positives are judged to outweigh its negatives.”

“Among the biggest super funds, which most Australians have their super in, there’s a wide variety of 'sustainable' options on offer.”

“Most super sustainable options in Australia use some combination of 'negative screening' (excluding sectors like fossil fuels, gambling or weapons) and 'positive screening' (favouring companies with strong environmental, social and governance practices).”

“HESTA’s 'sustainable growth' option has a long list of exclusions, including companies with thermal coal, oil and gas reserves, tobacco and controversial weapons. Its thresholds vary for each category, from outright bans (such as on uranium miners) to restrictions on revenue (such as weapons).”

“AustralianSuper has a 'socially aware' option with some of the same exclusions. But its thresholds also vary. Last year, AustralianSuper attracted criticism for buying back into Whitehaven Coal for its wider, non-sustainable investment portfolio – a reversal of its 2020 sale of stocks in the coal miner.”

“The Australian Financial Review recently reported Australia’s third-largest pension fund Aware Super was lifting some restrictions on investments in carbon-heavy companies, under a new benchmark system to track which companies are doing most to cut emissions.”

“However, Aware Super told The Conversation that current fossil fuel screens in place for its 'socially conscious' investment options 'remain unchanged'.”

“Vanguard was then hit with a record $12.9 million penalty, after it was found to have misled investors about its $1 billion ethical bond fund.”

“The Australian Competition and Consumer Commission (ACCC) has again made greenwashing one of its enforcement priorities for the next year. The watchdog predicts misleading environmental claims will 'continue, if not increase' as Australia transitions toward 'net zero' emissions.”

“If you’ve chosen a 'sustainable' or 'socially responsible' option because you care about particular issues, it’s worth checking if the fine print in your fund meets your expectations.”

“None of this means sustainable investing is a bad idea. In fact, research suggests companies investing in sustainable and socially responsible activities tend to be better governed – and that this is more often than not good for shareholders too.”

“Active Super was ordered to pay $10.5 million in a third greenwashing case. The court found Active Super’s marketing claimed it had eliminated investments in areas like gambling, coal mining and oil tar sands – when it hadn’t.”

“Mercer Super was fined $11.3 million after admitting it made misleading statements about its 'sustainable plus' options.”

“Just last month, the Environmental Defenders Office lodged a complaint with the Australian Securities and Investments Commission (ASIC) about industry fund UniSuper. The complaint came after UniSuper halved the environmental revenue threshold for its 'global environmental opportunities' product – from 40% to 20%.”