How active investment management encourages good corporate practices
When it comes to our investments, we use our financial influence to encourage good corporate practices.
We manage over 70% of our investments in-house across all major Australian and global asset classes. In-house management helps drive performance and keeps fees low.
It also enables us to engage directly with the boards and management of investee companies on important issues, including those relating to the environment, social concerns and the management and governance of our investments. We refer to this as ESG (environment, social, governance).
As owners of companies, we’re able to influence corporate practices by voting at company meetings. We exercise proxy votes for all listed Australian and international share holdings. Proxy voting covers the likes of Say on Climate, shareholder resolutions and remuneration reports.
Every six months we publish a Responsible Investment report, which shows how we’ve engaged with companies and other stakeholders, and how we’ve voted.
A closer look at how ESG fits into our investment process
Promoting strong ESG practice is a key part of our investment process, and we apply this across all portfolios. Our Investments team looks at a range of factors when investing our members’ super, such as environmental risks, climate, modern slavery, occupational health and safety, and how companies are governed.
Our activity over the six months to 31 December included:
- holding 78 company meetings covering ESG issues, as well as a further 18 meetings hosted by the Australian Council of Superannuation Investors (ACSI)
- reviewing the ESG processes and performance of our external global equities managers as part of our annual review process
- participating in a four-day ESG workshop with one of our key investments, Sydney Airport, looking at its progress in environmental management, climate, occupational health and safety and employee wellbeing
- undertaking ESG due diligence on a number of new investments looking at both project risks and positive impacts, like the social benefits from our recent investments in PRP Diagnostic Imaging and UNSW’s Health and Innovation Precinct.
- providing feedback on sustainability reporting and climate disclosures for a number of investee companies
- contributing to the ACSI research report A just transition to a clean energy economy.
Other activities include our involvement with Climate Action 100+, co-chairing ACSI’s working group on Rights and Cultural Heritage Risk Management, being a signatory to the 2022 Global Investor Statement to Governments on the Climate Crisis and engaging with companies around Say on Climate.