Over the past decade, the understanding that the physical effects of climate change will create significant economic and investment risk has been widely accepted by the mainstream, including global leaders and the world’s largest investors. Both are increasingly taking concrete, measurable action.
The physical risk to business’ assets, the impact from extreme weather events, and the implications of the transition to a low-carbon economy on a business’ long-term profitability are also acknowledged. When combined with the global push towards a net-zero economy, and accelerating innovation in clean energy technologies, the necessity of putting climate risk at the centre of investment decisions is clear.
The good news for our members is that with risk comes opportunity. Global efforts to address climate change in innovative ways present exciting new opportunities to invest your super; for example, investments like battery-storage projects which support the integration of renewable, low-carbon energy into traditional energy grids. We recently invested $US 30 million to create battery storage hubs in New York City by re-purposing under-utilised real estate like parking lots, alleyways and rooftops.
Acting with others to drive change
For us, part of being a responsible investor and owner is our active commitment to work with other like-minded investors and groups to encourage change. That’s why we are a foundational supporter of Climate League 2030 – a 10-year initiative to support and act towards a goal of reducing Australia’s annual greenhouse gas emissions by at least a further 230 tonnes from what is projected for 2030.
We have pledged to do our part with at least one new action each year under three themes:
The integration of the Paris-aligned emissions reduction goals into our investment policies and business strategies.
Collaboration between investors, clients, and companies to deliver emission reductions.
Investment in new clean energy, clean technology and other projects and measures which help reduce Australian emissions.
Commitments and achievements over our first year
1. Integration: We are targeting a minimum 30% reduction in emissions in our listed equities portfolio by 2023, including the introduction of a new low-carbon index.
As at 30 June 2021 we have reduced emissions from our listed-equities portfolio by 45%, exceeding our target.
2. Collaboration: We are an ongoing participant in the Climate Action 100+ initiative and lead investor for Santos and Origin.
The Climate Action 100+ 2020 Progress Report was released in December 2020 showing progress against objectives.
3. Investments: Invest up to $A150 million in renewables, clean and transition technologies across our infrastructure and private equity portfolios in the 2021 financial year.
As at 30 June 2021 we have committed approximately $A 1 billion in capital to renewable energy and low-carbon projects, including Tilt Renewables, Terra-Gen, Generate Capital and Perfect Power Solutions.
If you would like to read more about Aware Super’s progress and commitment to addressing climate change to ensure we continue to deliver for our members, you can read about the year in review.
One year on report
Aware Super has committed to achieving net zero in our investment portfolio by 2050.