by Andrea Malcolm
New Zealand’s Financial Markets Authority says it is aware of the action but as the case is before the courts it cannot comment.
ASIC alleges Active Super exposed its members to investments it claimed to restrict or eliminate.
This includes holdings in tobacco manufacturing, oil tar sands and gambling. Active Super also claimed via its website it had added Russia to its list of excluded countries, following the invasion of Ukraine.
ASIC Deputy Chair Sarah Court said in a statement, ‘There is much competition among super funds for new members, and we know that funds seek to attract members with promises their investments will not be exposed to certain industries. When making these claims super funds must have evidence to back their claims and ensure they are not promising exclusions that they cannot guarantee.’
From 1 February 2021 to 30 June 2023, ASIC alleges Active Super held 28 holdings, either directly or indirectly, which exposed members to securities it claimed to restrict.
Some of these holdings included gambling through Skycity Entertainment, PointsBet Holdings, The Star Entertainment, The Lottery Corporation and Tabcorp; tobacco through Amcor, Russian entities through Gazprom PJSC and Rosneft Oil Company; oil tar sands through ConocoPhillips; and coal mining through Coronado Global Resources, New Hope and Whitehaven Coal.
ASIC also says that following the start of the war in Ukraine, Active Super represented that it would stop investments in Russian companies despite maintaining holdings in Russian securities as late as 30 June 2023.
The regulator alleges the ESG misrepresentations were made on Active Super’s website, disclosure documents and on social media platforms Facebook, Instagram and LinkedIn.
This is ASIC’s third greenwashing civil penalty proceeding after it recently took action against Mercer Super and Vanguard Investments Australia.
ASIC is seeking declarations, pecuniary penalties, adverse publicity orders and an injunction against Active Super from the court.
Active Super was formerly known as Local Government Super (LGS) and was established as a profit-to-member industry scheme in 1997.It began trading as Active Super in 2021.
The date for the first case management hearing is yet to be scheduled.
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