RIAA Super Study 2021

Image Credit: UN Climate Change eLearn

This is the fourth RIAA detailed survey of Australia’s (largest *) super funds, to assess responsible investment (RI) performance from mid-2019 to December 2020. 

RIAA’s Responsible Investment Scorecard consists of 15 questions, covering four key areas, or pillars:

• Pillar 1: Coverage of and commitment to responsible investment

• Pillar 2: Enhancing risk management through explicit and systematic consideration of ESG factors and other screens, including reporting

• Pillar 3 :Being strong stewards for more sustainable and resilient assets and markets

• Pillar 4: Allocating capital to benefit stakeholders and contribute to solutions, measurement and reporting of outcomes

The RI Super Study is designed to help:

• Monitor trends in the superannuation sector’s engagement in responsible investment practices;

• Help super funds better understand the range of practices in responsible investment, including what constitutes leading practice; and

• Help consumers understand how super funds function and engage to achieve responsible investment goals, allowing consumers to make informed decisions regarding their superannuation.

RIAA Super Study 2021 - Key Findings:

Responsible Practice

• 25% of funds demonstrate leading practice responsible investment

• The majority of funds (77%) still have work to do in terms of transparency, to publicly disclose their holdings in 2022

Financial Performance

Leading practice funds -

• Financially outperform their peers (over 1 and 7 years); and

• The MySuper default product is better over 3,5 and 7 years.

Climate Risk

• Is now actively assessed by 92% of funds at board/ trustee level (up from 74% in 2019 and 64% in 2018)

These are the 13 Leading RI funds (received at least 70% score)

• Active Super, Australian Ethical Super, Australian Super, Aware Super, BT Superannuation, CareSuper, Cbus, Christian Super, HESTA, Mercer Superannuation (Australia) Limited, Rest, UniSuper and Vision Super.

Gender Balance

• Leading funds have 44% of the total gender balanced boards.

Responsible Investment Decision-Making

• RI is now influencing how the majority (55% this report, up from 39% in 2019) of funds invest and allocate funds and assess risk.

You can find the full report on RIAA's website here.

* The scope includes the largest 48 superannuation funds in Australia, regulated by the Australian Prudential Regulation Authority (APRA), as well as five other asset owners that pursue underrepresented responsible investment approaches (notably faith-based) or underrepresented sectors (public or retail super funds).

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