We offer Socially Conscious options for members who prefer to limit their investment in particular industries and companies Aware Super considers to have a highly adverse environmental or social impact.
Key points:
- We offer four Socially Conscious investment options.
- Investments in our Socially Conscious options are selected and managed according to specific restrictions known as screens.
- The screens describe the types of investments that are intended to be excluded from these options.
- Our screens are grouped into three categories:
- climate change screens
- ethical screens
- conventions and controversies-based screens.
- The Socially Conscious options are also managed in accordance with Aware Super’s Responsible Ownership approach.
- Each of the Socially Conscious options has been certified by the Responsible Investment Association Australasia.
- More details can be found in the relevant Product Disclosure Statement or Handbook
Explore our four Socially Conscious investment options
We have four diversified Socially Conscious options. You can choose to invest all or part of your super into one or more of these options. The options available to you will depend on the type of account you have with us.
Future Saver and Retirement Transition accounts
Retirement Income accounts
How we manage Socially Conscious investments
Aware Super’s Responsible Ownership principles apply to all investment options. The Socially Conscious options also apply additional and stricter restrictions to their investments. In this way, the Socially Conscious options are designed for members who prefer to limit their investment in companies Aware Super considers to have a highly adverse environmental or social impact.
Our Socially Conscious options are diversified investment options. They invest across a range of:
- asset classes
- asset types (listed and unlisted)
- investment managers, and
- investment styles.
We partner with specialist external investment managers to help us manage some of the investments for these options.
You can learn more about how we manage our Socially Conscious investment options by reading the Investment & Fees Handbook (PDF, 3.1MB) (for Future Saver accounts) or the Retirement Income PDS(PDF, 5.4MB) (for Retirement Transition and Retirement Income accounts).
What we limit or exclude
Screens within our Socially Conscious options are grouped into three categories:
- climate change
- ethical
- conventions and controversies.
The tables below provide more information on the screens and how each is applied.1 The Socially Conscious options will not invest in companies and other entities involved in the activities listed where the stated thresholds are met.
Please note:
- Up to 5% of the private equity asset class may be invested in companies and other entities not meeting the screening criteria, other than the tobacco, nicotine-alternatives and tobacco-based products and controversial weapons screens.
- The screening criteria do not apply to the use of derivatives or securitised assets (financial products that give the holder exposure to a pool of loans, bonds or other debt products). This means derivatives and securitised assets may have an indirect exposure to companies or other entities involved in the screened activities below.
- Continuous application of the screens may not always be possible. This may result in inadvertent holdings, typically over the short term, in investments we are seeking to exclude. If this occurs, we will endeavour to divest as soon as reasonably practicable.
- We do not exclude companies that provide goods or services to companies generating revenue from the screened activities or are involved in the distribution or deployment thereof, unless otherwise stated.
- We do not automatically exclude companies’ subsidiaries, joint ventures or bond issuers; each is assessed on its own verifiable involvement in the relevant activity. For example, if a company is excluded due to its involvement in controversial weapons, its subsidiary will only be excluded if it is assessed to be verifiably involved in controversial weapons based on its own activities.
Our Investment team may also decide to exclude companies for other reasons outside our formal criteria.
We rely on data provided by ISS STOXX to apply the screening criteria across Australian and international shares and fixed income within the Socially Conscious options. For information on ISS STOXX’s methodology, see their website. The most relevant documents include the ‘Energy & Extractives Screening’, ‘Controversial Weapons Research’ and ‘Sector-Based Screening’ methodology and research process papers.2
1 The screening criteria are periodically reviewed by our Responsible Investments team and may be updated from time to time.
2 ISS STOXX may change these documents and their titles at any time.
Climate change screens
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| Screen | Description | Threshold |
|---|---|---|
| Fossil fuel exploration or production | Fossil fuel exploration1, extraction, production, refining, processing, and/or electricity generation. Fossil fuels include coal2 (thermal, energy and metallurgical), conventional oil and gas, unconventional oil (oil sands, tar sands and shale oil) and gas (coal seam gas and shale gas). |
5% or more of revenue |
| Fossil fuel transportation | Includes fossil fuel (coal, oil and gas) storage and transportation including pipelines, storage tanks, freight, rail and ports. | 5% or more of revenue |
| Fossil fuel supply chain and services | Directly owning and/or supplying fossil fuel (coal, oil and gas) mining equipment, oil and gas equipment and services. This screen does not include companies that provide services to the fossil fuel industry whose purpose is to support the transition to a lower carbon economy. |
5% or more of revenue |
| Fossil fuel reserves |
Companies that hold fossil fuel reserves (whether proven or probable) with the intention of exploration and/or development of those reserves for revenue generation (rather than for own use). | No threshold |
Ethical screens
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| Screen | Description | Threshold |
|---|---|---|
| Tobacco, nicotine alternatives and tobacco-based products3, 4 | Production/manufacture of tobacco, nicotine alternatives and tobacco-based products. | No threshold |
| Gambling | Production, distribution or provision of services in relation to gambling | 5% or more of revenue |
| Alcohol | Production of alcohol | 5% or more of revenue |
| Pornography | Production and/or distribution of pornography | 5% or more of revenue |
| Uranium | Uranium mining | 5% or more of revenue |
| Nuclear power | Nuclear power production and/ or generation | 5% or more of revenue |
| Civilian firearms | Production and/or distribution of civilian firearms and related services | 5% or more of revenue |
| Military equipment | Production and/or distribution of military equipment (combat and non-combat) and related services5 | 5% or more of revenue |
| Live animal exports | Owning and/or operating live animal export operations | No threshold |
Conventions and controversies-based screens
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| Screen | Description | Threshold |
|---|---|---|
| Controversial weapons4 | Companies verifiably involved in6 the development, production, acquisition, stockpiling, retention or transfer of controversial weapons (whole systems or key components7), as well as companies that provide assistance in any of these activities. Controversial weapons means anti-personnel mines, biological weapons, chemical weapons, cluster munitions, depleted uranium, incendiary weapons, white phosphorous weapons and nuclear weapons. |
No threshold |
| Corporate controversies | Companies consistently involved in very severe incidents/ corporate controversies, or that are believed to be at high risk of being involved in serious incidents in the future. | Exclusion is at Aware Super's discretion |
1 Exploration means companies engaged in pre-production stages of the extraction of fossil fuels including prospecting for, acquiring, exploring and developing resources prior to the point where the production of commercially recoverable quantities commences.
2 There is a fund-wide restriction on companies generating 10% or more of their revenues directly from mining thermal or energy coal. A lower threshold of 5% is applied to the Socially Conscious options and extends to other forms of coal, such as metallurgical coal. The Socially Conscious screen also incorporates extraction, production, refining, processing and mining, and applies to all investments other than derivatives and securitised assets.
3 Nicotine alternatives and tobacco-based products include, for example, vaping devices and e-cigarettes.
4 While there are fund-wide restrictions in relation to tobacco and controversial weapons (see the ‘Restrictions’ section of our Responsible Ownership page), the Socially Conscious screens are broader and not subject to materiality thresholds.
5 The scope of military equipment and related services is based on international arms export control standards, and does not cover equipment, products or components that were not designed or modified on the basis of military specifications (e.g. commercial off-the-shelf products).
6 For liquid investments such as shares and bonds, this verification is undertaken by our ESG data provider, ISS STOXX. For unlisted investments, an internal assessment is made.
7 A component is a key component if it plays an essential role in the functionality of the specified weapon system or is specifically designed or modified for the specified weapons.
Responsible Investment Association Australasia certification
The RI Certification Symbol is issued by Responsible Investment Association Australasia (RIAA) ACN (641 046 666), AFSL (554110) and signifies that a product or service offers an investment style that takes into account environmental, social, governance or ethical considerations. The Symbol also signifies that the High Growth Socially Conscious, Balanced Socially Conscious, Conservative Balanced Socially Conscious and Conservative Socially Conscious investment options adhere to the operational and disclosure practices required under the Responsible Investment Certification Program for the category of Product and are assessed against RIAA's Responsible Investment Standard. The Certification Symbol is a Trademark of RIAA. For detailed information about RIAA, the Symbol and Aware Super's methodology, performance, stock holdings, remuneration and details about other responsible investment products certified by RIAA, refer to www.responsiblereturns.com.au and the RIAA Financial Services Guide.1
1 The Responsible Investment Certification Program provides general advice only and does not take into account any person’s objectives, financial situation, or needs. Neither the Certification Symbol nor RIAA recommends to any person that any financial product is a suitable investment or that returns are guaranteed. Because of this, you should consider your own objectives, financial situation and if the advice relates to the acquisition, or possible acquisition, of a particular financial product. Certifications are current for 24 months and subject to change at any time.
Things to consider
- The exclusion or restriction of certain sectors and investments will impact the returns of the Socially Conscious options when those sectors perform well or poorly.
- While a Socially Conscious option may align with your personal preferences, you should also consider if it meets your financial goals and attitude to risk.