Set by the United Nations with the objective of transforming the world by 2030, the Sustainable Development Goals help us to identify opportunities that will help generate benefits for our members and positively contribute to society.
The Sustainable Development Goals are global goals covering social and economic development issues including poverty, hunger, health, education, global warming, gender equality, water, sanitation, energy, urbanisation, environment and social justice. They can serve as a compass for investors, encouraging consideration and providing a framework to measure the impact of investments on the world.
Our Sustainable Development Goals
We believe the lifestyle our members achieve in retirement is impacted by the state of the environment and society into which they retire, as well as their retirement savings and incomes. Accordingly, we’ve identified a number of Sustainable Development Goals (highlighted in the diagram below) to which we believe we can make a positive contribution.
How our members’ retirement savings support the Sustainable Development Goals
We’ve long been committed to investing our members’ savings responsibly, and so we established a baseline to show how investment of our members’ retirement savings supports the Sustainable Development Goals. For every $1,000 of a member’s retirement savings invested in our equity portfolio, we calculated the amount that’s directed into companies with products and activities that support the Sustainable Development Goals. The results are presented below. For example, for every $1,000 invested, $36 goes to companies involved in renewable energy production.
How we monitor the real-world impact of our investment managers’ decisions
In order to encourage greater consideration of real-world impacts, alongside risk and return in investment decisions, we have started using the Sustainable Development Goals as a tool in our manager monitoring process.
When we sit down with equities investment managers on a quarterly basis, we provide them with information on the alignment of their portfolio to the Sustainable Development Goals. We compare this to the benchmark in order to facilitate greater discussion about how they are integrating environmental, social and governance factors into the investment process, and to increase consideration of real-world impact.
We believe we’re the first super fund to measure the performance of our equities investment managers in this way.
Investing in the Sustainable Development Goals
The Sustainable Development Goals play an important role in how we will implement our strategy of investing in sustainable outcomes, as they provide a framework suitable for identifying investment opportunities..
As a world-wide focus of policy and programs, the Sustainable Development Goals help identify areas of investment needs as well as likely future growth and opportunities. It’s a given that all of our investments must meet risk and return requirements, but other things being equal, we will favour investments which contribute to positive environmental and social outcomes, and avoid investments which have the opposite impact.
Measuring the impact of our investmentsWe are also working to use the targets and indicators that support the Sustainable Development Goals to measure the impact that we help to create in the world. Rather than reporting on dollars invested, we hope to soon be able to report metrics across all of our asset classes, such as jobs created, megawatts of renewable energy, public transport passenger journeys and greenhouse gas emissions avoided.