AustralianSuper has reinvested in Whitehaven Coal, describing the move as “an investment opportunity” aimed at creating value for its members.
The country’s largest coal producer disclosed to the ASX on Monday that the super fund had acquired a 5.07 per cent stake, amounting to some 42.4 million ordinary shares – each worth $5.40 as of Tuesday.
The recommitment comes after the fund divested from Whitehaven in November 2020 as part of its pledge to achieve a net-zero carbon emissions investment portfolio by 2050.
The latest acquisition makes AustralianSuper the miner’s second-largest shareholder, behind Vanguard.
Unlike several of its peers, the country’s largest fund has not adopted a formal exclusion policy on thermal coal. This leaves AustralianSuper with the flexibility to invest in companies like Whitehaven, provided they meet its investment criteria.
Speaking about the fund’s new net-zero target being led by a focus on returns, AustralianSuper’s ESG director Andrew Gray said at the time: “At the end of the day for us, this is about good investment practice.”
In a statement to Super Review sister brand InvestorDaily on Tuesday, a spokesperson for the fund said: “The company provides an investment opportunity with its current pricing to create value for members, and due to recent acquisitions, it now has a majority business exposure to metallurgical coal, which is currently a key component of global steel production.
“Its geographically diverse customer base is also important given the current global trade dynamic.”
Asked how the move aligns with its net-zero by 2050 commitment, the spokesperson said: “We remain committed to our long-term goal of net zero by 2050.
“AustralianSuper considers ESG as part of our investment process. Our equities and ESG teams meet together with companies to ensure a consistent view and focus on investment issues.”
However, the decision has drawn strong criticism from environmental finance group Market Forces. Senior superannuation analyst and campaigner, Brett Morgan, labelled the move “an insult to its millions of members”.
“The only way AustralianSuper can justify this giant backflip is by using its position to end Whitehaven’s polluting and risky coal growth plans and instead return shareholder capital through a wind down strategy,” Morgan said.
He urged the fund to “uphold its climate commitments” by pushing for an end to the miner’s “dangerous” coal expansion and managing down existing production, adding that failure to do so would render the investment “unjustifiable”.
“Whitehaven’s polluting coal expansion strategy undermines AustralianSuper’s climate commitments so the fund must oppose these growth plans or can expect scrutiny for greenwashing,” Morgan said.
Whitehaven’s recent acquisitions of the Blackwater and Daunia metallurgical coal mines from BHP have shifted its revenue mix, with the company now projecting that approximately 70 per cent of its income will derive from metallurgical coal, a key component in steel production, and about 30 per cent from thermal coal used in electricity generation.
However, Market Forces has said that thermal coal production is expected to rise by approximately 60 per cent, largely driven by proposed developments such as the Vickery project in NSW and Winchester South in Queensland.
