Tuesday, January 25 2022

The pension manager has also dropped active investment exposure in ASX pure-play oil and gas producers, including Santos and Papua New Guinea-based producer Oil Search.

UniSuper cuts its exposure

AustralianSuper’s decision to remove active investment from Woodside came before the oil and gas giant’s Scarborough announcement, and the fund declined to comment on the company’s decision.

UniSuper’s latest climate risk report shows that its “look-through” fossil fuel exposures halved over the 12 months to August, extending a trend in place since 2019.

Will van de Pol, of Market Forces, an arm of the Friends of the Earth environmental group that advocates for fossil fuel divestment, said that includes a significant drop in exposure to Woodside.

“Woodside also dropped out of UniSuper’s list of ‘portfolio companies’, meaning they’re no longer in the fund’s top 50 Australian holdings, and exposure to these companies appears to only be through passive investments as per website definition of ‘portfolio companies’,” he said.

UniSuper’s stance contrasts with that of active fund managers such as long-standing investors Allan Gray and Katana Asset Management, which are backing Woodside’s decision to proceed with the project, on the basis that gas is needed for the transition to low-carbon energy.

Asked about Woodside’s decision to green-light the Scarborough development, a UniSuper spokeswoman said: “We don’t comment on specific stocks with regard to future investment or divestment intentions.”

UniSuper was singled out at the start of last year by Market Forces for its fossil fuel holdings. The $100 billion fund has since committed to net zero carbon emissions targets.

Earlier this month, the fund’s chief investment officer, John Pearce, said UniSuper’s “reduction in exposure to fossil fuels has not been in response to activism”.

“It represents a judgment of the medium- to long-term prospects of certain companies making the transition in a decarbonising world.”

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