A turning point has emerged in the pensions industry: Australian super fund Future Super has become the world’s first climate neutral pension fund with the help of South Pole Group, a global sustainability solutions provider.
Spurred by global initiatives, like the UN PRI Montreal Carbon Pledge, the Portfolio Decarbonization Coalition and the Divestment Movement, the pension fund industry is now in full transition.
Like their global peers, Australian pension funds are under increasing pressure to consider climate change impacts within their portfolios in order to safeguard their members’ savings. Despite growing concerns of having fossil fuel assets become stranded, the average Australian pension fund maintains investments in the causes of climate change, leaving it exposed to carbon risk.
Ever since its inception, Future Super, one of Australia’s most innovative and fastest growing superannuation funds has screened out investments in the fossil fuel industry. Today, it has upped the ante and become the world’s first climate neutral super fund.
The measurement of the fund’s carbon intensity and the compensating offsets for its remaining emissions have both been managed by South Pole Group. Future Super has specifically chosen offsets from the Group’s premium emission reduction projects located in China and Thailand that help to create renewable energy and reduce dependence on fossil fuels. These projects include proven and certified economic, social and environmental benefits for local communities.
Simon Sheikh, Managing Director of Future Super underlines: “We strongly believe in protecting the interests of our members. Future Super aims to be a true innovator in the industry. We believe the fossil fuel industry has far too many risks associated with it to be a responsible investment for the long term.”
Future Super’s portfolio had a carbon footprint of 1’321 tCO2e, compared to the ASX benchmark, which is 7.5 times more carbon intense. This is due to the fact that Future Super does not invest in fossil fuels, and instead directs capital to low carbon investments.
An analysis of the Australian pension sector found that the average person with a super balance of $50,000 has a portfolio that produces carbon emissions equal to 625kg CO2 per month, compared to the monthly emissions of 83kg of a Future Super portfolio. This means every person who switches to Future Super is saving 542kg of CO2 emissions every month.
Dr. Maximilian Horster, Director Financial Industry at South Pole Group says: “This prudent move by Future Super sets the global precedent for an industry looking to transform itself against the backdrop of climate change and the material risk of stranded assets based on impending carbon pricing schemes and further regulatory compliance issues.”
About South Pole Group
The Zurich-based South Pole Group began as a project-driven company focused on developing and selling high-quality carbon credits. Today, it is the world’s leading provider of climate solutions. No other firm in the world has developed as many successful emission reduction projects. No other company offers as rich a suite of services and solutions. South Pole Group helps public and private sector organisations develop climate proven policies and strategies. Areas of expertise cover every key sustainability-related area of climate change, including but not limited to: forests & land use, water, sustainable cities & buildings, as well as renewable energy and energy efficiency. For more information, visitwww.thesouthpolegroup.com or follow the company@southpolegroup.
About Future Super
Future Superannuation Holdings Pty Ltd was established to create financial services and investment opportunities for the many Australians seeking to use their money to create a better, more sustainable future.
The company was founded by Simon Sheikh, former National Director of the one million member advocacy organisation GetUp, and Adam Verwey, who has over a decade experience in the ethical investment industry. In 2014 the company launched Future Super, Australia’s first fossil fuel free super fund. In just over 12 months the super fund has grown to manage over $100 Million on behalf of over 3500 Australians.
In 2015 Future Super launched two first-of-a-kind sharemarket indexes – the Australian Fossil Free Index and the Australian Sustainability Leaders Index.For more information:www.myfuturesuper.com.au
Dr. Thomas Schroder, Director Marketing and Communications, South Pole Group
+612 9356 3600