How ASIC investment deep dives are generating greenwashing charges

ANALYSIS

Superannuation funds are on notice to be able to back up their claims around ESG investments, with the Australian Securities and Investments Commission (ASIC) have proved just how far it will go to audit their asset allocations.

That much was made clear as ASIC initiated civil proceedings in the Federal Court against Active Super alleging misleading conduct and misrepresentations to the market relating to claims it was an ethical and responsible superannuation fund.

What ASIC revealed in announcing its action against Active Super (formerly LGSS) is that it had done a thorough deep dive on the fund’s allocations.

That much was revealed by the list of companies detailed by ASIC as being inconsistent with the superannuation fund’s claims:

Skycity Entertainment Group Ltd – Skycity is one of two major publicly listed casino operators in Australasia, Skycity operates integrated entertainment complexes in New Zealand and Australia, each featuring casino gaming facilities.

PointsBet Holdings Ltd – PointsBet is an ASX listed sports wagering operator and iGaming provider, offering sports and racing products and services via its cloud-based technology platform.

Tabcorp Holdings Ltd –Tabcorp is a betting and entertainment experiences business. Their brands include TAB, Sky Racing and MAX.

Gazprom PJSC– Russian company Gazprom operates gas pipeline systems and carries out the exploration, production and transportation of gas.

Rosneft Oil Company – Russian company Rosneft Oil Company engages in the exploration, development, production and sale of crude oil and gas.

Shell Plc – Shell is an energy and petrochemical company which supplies crude oil and natural gas, as well as oil sands activities.

Amcor PLC – Amcor is a global manufacturer of flexible and rigid plastic packaging and provides speciality cartons for the tobacco industry.

Whitehaven Coal Limited – Whitehaven Coal Limited operates 4 coal mines producing metallurgical and thermal coal for export across North and Southeast Asia.

What the ASIC list showed was that the regulator’s team had obtained Active Super’s list of investments and then examined the annual reports of the companies involved in those investments.

It then measured this against ASIC’s Super’s Impact Report which said: “We eliminate investments that pose too great a risk to the environment and the community, for example: Tobacco, nuclear weapons, oil tar sands, gambling.

ASIC demonstrated a similar deep dive with respect to its greenwashing charges against Mercer Superannuation and Vanguard Investments Australia.