8 things you need to know about UniSuper investments in fossil fuels.

1

UniSuper has some 450,000 members, is one of Australia’s largest super funds, and manages around $80 billion in retirement savings.

UniSuper’s divestment from fossil-fuels would therefore represent the effective removal of some $80 billion from the pool of investments available to the fossil-fuel industry. This is an enormous pool in potential loans to companies that make money by destroying the environment.



3

Divestment from fossil-fuel industries cannot be accomplished at an individual level.

Firstly, UniSuper’s pool of funds is locked in due to Enterprise Bargaining Agreements struck between the National Tertiary Education Union and University administrations. In exchange for this monopoly, the NTEU has a representative on the Board of UniSuper. In most instances, UniSuper is the prescribed superannuation fund, particularly for casual staff per those Enterprise Agreements. As such, choice of funds is not available to most casual employees. In some cases, tenured staff have scope to shift to other funds after a period of time, but even that is often still administered through UniSuper. That is, UniSuper will often still take a cut even where it appears as if retirement savings are invested in another fund.

Secondly, in terms of physical power systems, individual divestment from fossil fuels is impossible. There is no truly green energy system in Australia. Nominally ‘100% renewable’ options represent financial contracting arrangements based on energy sourced from an interconnected grid that continues to be underpinned by fossil fuels. Systemic change requires broad withdrawal of financial support for high-emitting industries via institutional divestment. Industry super funds are the backbone of institutional investments.


4

‘Sustainable Options’ are a marketing tool.

‘Sustainable Options’ are a means of avoiding complete divestment from industries with poor reputations. Put simply, they are a commercial risk management strategy directed toward altering members’ perceptions of a fund rather than changing the actual impact of its investments. ‘Options’ still contribute to the administration costs of a fund’s other investment bundles, and ‘administration costs’ can be either undisclosed or so vaguely described as to eliminate any meaningful distinction between ‘options.’ Options within a fund do not represent divestment by that fund.

The ineffectiveness of ‘Sustainable Options’ is further reflected in the fact that over 60% of UniSuper’s ‘Sustainable Balanced’ investments remain undisclosed. There is no way to be certain about whether or not UniSuper is investing its member’s money in fossil fuels without a policy of divestment and full disclosure.


5

The NTEU has passed a motion expressing concern about fossil fuel investments, but which does not demand full and immediate divestment.

The NTEU National Council has resolved to:

“request UniSuper urgently prepare a ten-year plan to transition all invested funds to be fully carbon neutral by 2030.”

Firstly, ‘carbon neutrality’ is not equivalent to divestment, but can include funds which invest in fossil fuels whilst engaging in ‘offsetting’ and other greenwashing accounting practices. This is not equivalent to cutting emissions, which requires removal of fossil fuels, not merely their supplementation with other activities.

Secondly, we question the timing of a ten-year plan given the urgent need to cut emissions for the sake of our lives, health and communities.

We encourage the NTEU and Public Service Association (PSA) to pass member motions calling for immediate withdrawal from all fossil fuel investments. Existing motions allow for delays and offsets.


6

So-called ‘Green Funds’ are not a viable alternative to the divestment of large industry-based and institutional funds.

Even if it were hypothetically possible for university staff to shift to ‘Green Funds’—and in most instances, it is not (see above)—they represent tiny pools of investments relative to the billions held by companies such as UniSuper. Additionally, using divestment campaigns as vehicles to promote ‘Green Funds’ effectively derails those divestment campaigns, transforming them into advertisements for commercial entities branded as ‘green’ or ‘ethical,’ and whose operations and investments are likely to be undisclosed. Any investment fund can brand themselves as ‘green.’ Promoting ‘Green Funds’ is in the interests of the owners of those funds, not campaigns whose objective is decarbonisation.


7

Investing in ‘green’ energy is not enough to cut emissions.

Adding renewables does not in and of itself reduce emissions; this requires removal of fossil fuels. Sustainable options allow funds to grow their portfolio such that renewables become additional to, rather than a substitute for, high emissions investments. Addressing climate change requires withdrawal of these investments rather than merely their supplementation with other power sources.


8

Fiduciary duty and company ‘engagement’ are not arguments against complete divestment.

UniSuper will often counter demands for divestment with arguments that it has a fiduciary duty to seek the highest returns on investments. This is a false economy, particularly when companies involved in fossil fuel extraction, circulation and consumption have managed to externalise the costs of climate change, displacing those costs on to emergency response agencies, the healthcare system, and others who bear the brunt of climate change. While UniSuper have taken some steps toward a broader environmental and social definition of costs, they have largely used this as a means of managing the risk of divestment campaigns rather than dealing with the actual and often externalised costs of climate change.

Similarly, UniSuper have been advising members that they prefer to use investment as a means to ‘engage’ with fossil fuel companies, the argument being that serious change requires having a ‘seat at the table’. This is a line that was previously used by the Australian Council of Trade Unions (ACTU) to oppose divestment from the Australian detention industry. As was argued at the time, this idea relies on misrepresenting the inherently destructive and unreformable nature of detention camps and fossil fuels. As such, the appeal to ‘engagement’ is primarily about securing fossil fuel industry profits and has nothing to do with any real world reduction in fossil fuel use.


This information was compiled by people who have investments in UniSuper and have previously been involved in successful superfund divestment campaigns. Our goal is to cut through the confusion and misinformation that is being circulated on this topic, not to spruik companies which purport to offer 'green investments' or tell you where you should put your money. Be careful out there.

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