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Our responsible

Published December 2020

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Content Team
5 min read
Updated 19 Dec 2023
  • Responsible investment

Our responsible investment approach helps us to better manage risks and to optimise retirement outcomes for our members.

This approach is explained in our Responsible Investment Policy, which we review and update at least annually.

ESG integration

We recognise the importance of considering environment, social and governance (ESG) risks and include these when setting the investment strategy for our investment options, as well as, when feasible, selecting and reviewing investment managers. In doing so, we are better able to protect and optimise our members’ investments over the long term.

Active ownership

When it comes to investing in company shares, we believe that active ownership – which involves company engagement and voting at company meetings – is critical to the governance of investments over the long-term. It can also positively influence company behaviour and performance, supporting the achievement of shareholder value.

Engagement involves meeting with representatives of an investee company, usually members of the board or executive, in order to advocate for change. During 2021–22, Hostplus engaged with 791 companies either directly or through our specialist providers, the Australian Council of Superannuation Investors (ACSI) and Hermes Equity Ownership Services.

Voting on resolutions at shareholder meetings provides us with the opportunity to express our views to that company’s management team. As a shareholder in many top-listed companies in Australia and overseas we voted on more than 35,000 proposals at more than 2,600 company meetings during the financial year ended 30 June 2022. Our voting records can be found here.

Engagement drives change. Recent outcomes of company engagement include:

  • 20 target companies set net zero 2050 goals (with 70% of ASX200 market capitalisation now covered by net zero 2050 commitments)
  • 16 target companies integrated climate change into executive remuneration
  • 20 companies implemented positive changes to remuneration plans  
  • 4 companies made progress on cultural heritage frameworks
  • 14 companies improved safety reporting, including fatality disclosures.

Hostplus Socially Responsible Investment (SRI) options

Hostplus has three dedicated socially responsible investment options, giving our members access to responsible investing opportunities by reducing exposure to certain industries. They invest across a wide range of asset classes, including shares, property, fixed income, infrastructure, private equity and cash.

These options seek to, where feasible, invest in companies and assets that contribute to the United Nations’ Sustainable Development Goals (SDGs). They also seek to reduce exposure to investing in fossil fuels, companies that breach human rights or labour rights, uncertified palm oil, tobacco, live animal export and some other sectors.

Addressing climate change risk

Climate change is one of the biggest challenges facing the world today. Hostplus recognises climate change as a financial risk, as well as an environmental and community one, the impact of which will be dependent on the extent of social and regulatory changes. We consider the financial risk climate change has in our investment process, including, where possible, our investment philosophy, strategic asset allocation process, stress testing, and investment manager selection and review. We also recently made a commitment to transition the investment portfolio to net zero emissions by 2050.

We believe Hostplus members are best served by an orderly transition to a low-carbon economy. Rather than divesting or selling holdings in particular sectors, Hostplus uses its influence as a shareholder to create change within companies by encouraging and supporting this orderly transition and by investing in climate solutions.‍ However, divestment may be considered where engagement is unsuccessful and target companies have been unwilling or unable to adapt to meet emissions reduction expectations.

United Nations Principles for Responsible Investing (PRI) rating

In 2022, we achieved a 4 our of 5 stars rating for our Responsible Investment Policy and Stewardship from the PRI.

PRI is an independent body and the world’s leading advocate for responsible investment, supported by the United Nations.

Our Public Transparency Report can be found here

The information in this article is correct as at time of publication.