06 May 2024

Australia's Second-Largest Pension Fund Blacklists Thermal Coal Investments

06 May 2024  by reuters   
The sun shines above high tension power lines in an industrial area of west Sydney

The sun shines above high tension power lines in an industrial area of west Sydney July 12, 2011. REUTERS/Daniel Munoz Purchase Licensing Rights

Australian pension giant Australian Retirement Trust said on Thursday it would stop investing in most thermal coal companies from July as part of a plan to hit net zero emissions across its portfolio by 2050.

The A$280 billion ($183 billion) fund has introduced new rules to exclude any company which generates more than 10% of its revenue from the mining and sale of thermal coal, one of the most polluting energy sources.

"As a global investor, Australian Retirement Trust is committed to achieving a net zero greenhouse gas emissions investment portfolio by 2050," it said in a statement.

"Australian Retirement Trust applies exclusions in limited circumstances as part of its sustainable investment approach in accordance with members’ best financial interest."

The rule change puts thermal coal in the same category of excluded investments such as tobacco, cluster munitions and landmines, according to a notice, opens new tab on the fund's website.

However, the rule does not bar thermal coal investments made indirectly via money invested with other fund managers. It also does not apply to metallurgical coal, used in steel making.

Climate activists celebrated the move and said Australian Retirement Trust was the largest Australian pension fund to halt thermal coal investments.

"It’s a tribute to the thousands of members who have demanded greater climate action from the fund,” said Brett Morgan, superannuation funds campaigner at Market Forces.

The change is unlikely to lead to big adjustments in its local portfolio given major Australian coal miners New Hope (NHC.AX), opens new tab or Whitehaven Coal (WHC.AX), opens new tab are already absent from its main fund, according to fund filings from December.


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