New analysis has revealed that Australia’s largest super funds are “failing to use the power afforded to them” to rein in oil and gas expansion plans.
Following the re-election of the chairs of two of the country’s largest gas producers, Woodside Energy and Santos, Market Forces has condemned super funds for “failing to use their influence to drive greater climate action at major gas companies”.
The group revealed that of the top 30 super funds, only six funds cast a binding vote against the re-election of Woodside Energy’s Richard Goyder in 2024 and only two opposed the re-election of Santos’ Keith Spence.
“Both companies are pursuing major new oil and gas projects out of line with global climate goals despite increasing investor pushback in recent years,” the clean energy and finance advocacy organisation said.
“This year’s Woodside and Santos AGMs offered crucial opportunities for super funds to prove their claims of using members’ investments to drive greater climate action yet our analysis has found that many super funds lost their nerve, failing to hold Woodside and Santos’ boards accountable for their gas growth plans, which threaten mounting environmental, social and financial risks.”
Analysing the funds’ voting patterns, Market Forces said Aware Super, ESSSuper, Spirit Super, State Super, and Vision Super all voted against the re-election of at least one of Woodside’s directors in 2023, before voting against the re-election of the company’s chair in 2024.
Conversely, the group revealed that while eight funds – Active Super, Australian Retirement Trust, CareSuper, Cbus, Equipsuper, HESTA, Rest, and TelstraSuper – voted against the re-election of at least one Woodside director in 2023, they did not vote against the chair’s re-election in 2024.
Regarding Santos, only two super funds, HESTA and Vision Super, intensified their stance by voting against the re-election of the company’s chair this year. HESTA justified its opposition to Spence, citing his “lack of engagement with and response to investor concerns”.
Funds need to take ‘decisive action’
Brett Morgan, superannuation funds analyst and campaigner, said that the nation’s leading funds are failing to step up when they should be using every tool at their disposal to prevent gas companies from expanding.
“Australia’s top super funds must stop greenwashing and start taking decisive action to hold company directors accountable for risky and harmful gas expansion,” Morgan said.
In particular, the analyst described HESTA’s efforts to drive change at Woodside this year as a “monumental failure”.
Namely, while HESTA earlier this year put forward its own director nominees for consideration at Woodside’s AGM, Market Forces described the fund’s efforts as “feeble”.
“Woodside brushed aside its picks for new directors, after securing public support from the fund for the re-election of the company’s chair,” the organisation said, but added that Woodside has since appointed a new director that HESTA confirmed was not one of its picks.
In response to a request for comment from InvestorDaily, Super Review sister brand, HESTA said both Woodside and Santos are on its watchlist as part of the fund’s “engagement escalation framework”.
“Our approach to active ownership is to select an appropriate combination of levers at any given time in response to each company and issue,” a spokesperson for the fund said.
“We consider our members’ best financial interests are served through a timely, equitable and orderly transition to net zero emissions by 2050 in order to minimise the systemic risks of climate change. This requires transition of our economy towards alignment with the Paris Agreement.
“Ongoing engagement is vital to how we encourage companies to be more ambitious in their transition plans, which helps manage the systemic risk of climate change.”
Other funds declined to comment to InvestorDaily’s inquiry at the time of publication.
