Socially Responsible Investment – Balanced option

This option is suitable for members with a five years plus investment horizon in pursuit of a diversified, pre-mixed investment option with a socially responsible investment style.

The SRI Balanced option has been designed for members specifically seeking to avoid exposure to fossil fuels, companies that breach humanrights or labour rights, uncertified palm oil, tobacco and other particular industries, while investing in assets that contribute to sustainable outcomes.

Compared to our default Balanced option, SRI Balanced has a similar split between assets with growth and defensive characteristics.

Importantly, investing sustainably shouldn’t cost you more. With Hostplus’ Socially Responsible Investment – Balanced option, it doesn’t.

The option’s underlying investment costs are lower than our default MySuper option.¹ And as a Hostplus member, you pay the same low cost administration fee, regardless of which investment option you choose.

The option invests through a diversified portfolio, including some growth assets and some lower risk investments. It targets a return of 3.5% above inflation, over a 20 year time frame (for accumulation members).

¹As at 30 June 2020. Investment costs can change regularly. Please visit https://hostplus.com.au/super/what-you-need-to-know-about-super/fees for the latest fees and costs breakdown.

Choose to invest as little or as much of your super in the Socially Responsible Investment - Balanced option as you like.

You can switch between Hostplus’ investment options for free and can invest your super in multiple options at the same time.

Our policy keeps us on track

As well as offering a Socially Responsible Investment - Balanced option, Hostplus is committed to responsible investment across all our investment activities.

Our Responsible Investment Policy is an important part of our investment approach as a Fund. It’s how we manage risk and optimise our members’ retirement outcomes.

• Fossil fuels: Companies that own reserves, explore, mine, extract, produce, refine or generate energy from fossil fuels as well as those companies that receive revenue from servicing these sectors through equipment services, pipeline transport or distribution. A zero-materiality threshold is applied, but dedicated renewable energy generators with backup fossil fuel sources (<5%) may remain investible. Data is supplied by MSCI and Institutional Shareholder Services (ISS) Inc.
• Human rights or labour rights breaches: Companies that breach the United Nations (UN) Global Compact or International Labour Organisation’s (ILO) Core Conventions. Data is supplied by MSCI.
• Very poor ESG policies and systems: Companies with an MSCI ESG rating of B or CCC.
• Controversial weapons: Companies involved in the development, production, maintenance or sale of controversial weapons (including cluster munitions, anti-personnel mines, depleted uranium, biological weapons, chemical weapons, blinding laser weapons, non-detectable fragment weapons and incendiary weapons). Involvement includes companies directly involved as well as prime-contractors, key sub-contractors, and suppliers of key components. Data is supplied by ISS.
• Uncertified palm oil: Companies involved in growing, processing or using palm oil, that derive >10% of their revenue from these activities and where <50% of the palm oil is Roundtable on Sustainable Palm Oil (RSPCO) Certified. Data is supplied by ISS.
• Predatory lending: Companies involved in predatory lending, including unfair or deceptive products, excessive interest rates, misleading marketing, inclusion of unnecessary costs and hidden fees and those targeting minority, low income or elderly consumers. Data is supplied by ISS.
• For-profit detention: Companies deriving >5% of their revenue from for-profit detention, e.g. prisons and immigration detention. Data is supplied by ISS.
• Gambling: Companies deriving >5% of their revenue from gambling. Data is supplied by MSCI.
• Tobacco: Companies involved in tobacco production. Data is supplied by MSCI.
• Live animal export: Companies involved in the export of live animals for the purpose of slaughter, husbandry and breeding, including specialized transportation. Data is supplied by ISS.

To refresh our Socially Responsible Investment – Balanced option, we’ve partnered with specialist external investment managers and sourced sustainable investment data from external providers.

The following describes the option’s approach to each asset class in further detail:

• Australian and International Shares – invested in listed Australian and International (developed market) share portfolios via an investment manager. The manager excludes the investments described above then seeks to maximise the Sustainable Development Goal (SDG) score of the portfolio.³ More details on the SDG scores can be found here.
  
  
• Property – invested in diversified property funds that have been identified as leaders (at the overall, regional and/or strategy level) by their Global Real Estate Sustainability Benchmark (GRESB) score and ranking. Hostplus applies exclusions as described above when selecting funds for the option.
• Infrastructure – invested in infrastructure assets including renewable energy, water utilities and social infrastructure. Hostplus applies exclusions as described above when selecting assets for the option.
• Private Equity – invested in a diversified mix of funds that have been identified as including companies that contribute toward achieving one or more SDG and/or are managed by an investment manager that has stronger-than-average responsible investment processes relative to peers within the same asset class. Hostplus applies exclusions as described above when selecting funds for the option (this involves avoiding funds that have exposure to one or more of the excluded industries or that adopt a fund-of-fund or secondaries structure).
• Diversified Fixed Interest – invested in passively managed Australian and Global Bond ESG funds whose processes most closely match the exclusions described above. The investment manager applies rules-based exclusions to non-government securities associated with fossil fuels, alcohol, tobacco, gambling, adult entertainment, genetically modified organisms, military weapons, civilian firearms and nuclear power, and for the global bond fund, treasury and government-related issuers with an MSCI ESG government rating below “BB”.⁴
• Cash – invested in cash products that are managed by investment managers with responsible investment processes. Hostplus applies exclusions as described above when selecting products for inclusion in the option.

³SDG Solution Overall Score. Data is supplied by ISS
⁴Definitions for exclusions are based on the Bloomberg Barclays Index exclusion methodology

Learn more

Read our Product Disclosure Statement and Target Market Determinations for more information about the Socially Responsible Investment - Balanced option and other Hostplus investment options.

If you can’t find what you’re looking for, please ask us here.