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HESTA restricts thermal coal investment
HESTA announced it is restricting investments in thermal coal across its portfolio after the fund's Board made the decision.
Under the restriction, the $29 billion fund will not make new investments in unlisted companies or newly listed companies that draw more than 15 per cent of revenue or net asset value from exploration, new or expanded production, or transportation of thermal coal.
The fund will also not provide direct funding via rights issue or share placements to already listed companies which plans to fund future expansion in any of these activities.
"Companies heavily invested in thermal coal face the highest 'unburnable carbon' risk, based on the size of existing proven coal reserves, the higher carbon intensity compared with other fossil fuels, and the increasing viability of substitutes for power generation, including renewable sources," HESTA CEO Anne-Marie Corboy said.
The fund's socially responsible investment option, Eco Pool does not invest in listed companies that get more than 15 per cent of its revenue or net asset value from electricity generation from brown coal or lignite, and the exploration, production or transportation of thermal coal.
It also does not invest in companies with uranium mining operations and tobacco manufacturers.
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