Our investment strategy


We have developed an investment strategy that reflects the reasons people join Future Super.

In addition to investing for your financial benefit, we aim to create systemic change through investment, by harnessing the power of your super to build a future without climate change or inequality.

Our actions as an investor have consequences for your community and planet, and we use three core strategies to pave the way toward a more sustainable future for you.

1. Divestment

We use a negative screening process (divestment) to protect you from exposure to unsustainable assets. Our screening removes harmful investments that pose risks to your super and your future from our investment universe, and directs the flow of capital elsewhere.

Divestment is one of our greatest tools to change systems, challenging the social licence of industries like fossil fuels and pressuring other investors to reject them. This process makes all our portfolios fossil fuel free, including companies and assets that provide services to the fossil fuel industry, like finance and transportation. We believe that’s a smart investment strategy because, as the world works to limit global warming to 1.5 degrees, most fossil fuel companies will likely be worth less over time.

It’s not just about what you do, it’s also what you don’t.

2. Reinvestment

We use reinvestment as a mechanism to create impactful super products by redirecting divested money into more sustainable investments and in impact opportunities.

We seek to identify investment products that avoid or reduce harm, and when these don’t exist, we partner with like-minded investors to create them. We also seek to invest some of our capital in impact investments, which directly address climate change or inequality. This realises the potential that our divestment unlocks.

3. Voting + Engagement

While we do our best to invest responsibly, no company is perfect. We use tools like voting and engagement to push the companies we invest in to improve things like their climate impact or supply chains.

Future Super actively engages with the companies we invest in and our industry on important issues (both individually and in collaboration with other investors). In addition, we also advise our investment partners on how to vote on shareholders resolutions at company Annual General Meetings (AGMs).

Key points to our investment approach

Protect members from the stranded asset risk of fossil fuels.

Reduce long term risk by investing in assets with superior environmental, social and governance (ESG) considerations.

Invest in assets that achieve financial outperformance for our members while building clean energy solutions

Use all of the tools at our disposal to safeguard our members’ future.

Everything we invest in

Future Super invests in a diversified range of assets - from impact assets like clean energy seed funds, to everyday companies you might recognise like Telstra. We don’t expect every investment to change the world, but we do make all of our investments public so that you can see where your money goes.

Explore our investments

Screening

All Future Super investments pass our screens before being considered. This rules based approach means that regardless of the investment option you choose, your super has some level of positive impact while also protecting you from certain risks.

We invest as broadly as possible in different assets, industries and regions, without compromising on our core investment screens. This gives our members the potential to experience superior returns that can result from companies thoughtfully addressing their environmental, social and governance opportunities and risks.

Our full screening strategy

Future Super Investment Services Pty Ltd (FSIS) is a service provider for the BetaShares products we invest in. The role of FSIS is to advise and provide recommendations to the Responsible Investment Committee on the index constituents and corporate actions. Details of FSIS services to BetaShares are found in our Financial Services Guide. Investment in Australian equities is predominantly made via the BetaShares Australian Sustainability Leaders ETF. Investment in international equities is via the BetaShares Global Sustainability Leaders ETF and the BetaShares Climate Change Innovation ETF. Exposure to global green bonds is predominantly made via the BetaShares Sustainability Leaders Diversified Bond ETF. For more information about these ETFs see https://www.betashares.com.au.

Screening in practice

The tool below gives examples of our core negative screens in action. Click on each to see real examples of companies that don’t pass our screens.

Fossil fuels
Gambling
Weapons
Tobacco
Uranium mining and nuclear energy

Fossil fuels are screened with the following Criteria

Does the company have direct fossil fuel reserves or mines and extracts fossil fuels?

Fails:   BHP Billiton, Woodside Petroleum (extracting and operating)

Does the company own or operate fossil fuel power generators?

Fails:   Origin Energy, AGL (operating)

Does the company provide specific and significant services to the fossil fuel industry including engineering, financing, transport, or logistics?

Fails:   Westpac, Commonwealth Bank, NAB, ANZ (financing), Aurizon (rail transport)

All Future Super investments are screened to ensure they align with our members’ values. To help us do this, we consider how each investment and asset class may have exposure to ethical risks or impact opportunities, as well as how they can work together to produce the best possible return for our members. Therefore, adapting our screening, stewardship and impact strategies for each investment leverages it for the best effect on climate change and equality while also reflecting our broader investment and risk management strategies. For more information on Future Super’s impact strategy, screening guideline for each asset, and specific thresholds for each screen, click here.

Voting and Engagement

Stewardship is an important part of the way we leverage the power of your super to create change.

We vote on shareholder resolutions presented at investee Annual General Meetings (AGMs), and engage with companies throughout the year to improve their ESG policies.

Carbon transparency

We release an annual report detailing the emissions associated with our investments.

Download carbon transparency report

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