Trust seeks to cut coal
Australia’s second largest pension fund is giving up thermal coal investments.
The Australian Retirement Trust has announced a commitment to cease most investments in thermal coal by July.
This decision is part of the fund's broader strategy to achieve net zero greenhouse gas emissions across its investment portfolio by 2050.
With assets worth AU$280 billion, the fund will now exclude companies that derive more than 10 per cent of their revenue from the mining and sale of thermal coal - one of the most polluting energy sources.
This significant policy shift places thermal coal on the same exclusion list as tobacco, cluster munitions, and landmines, according to an update on the fund’s website (PDF).
“As a global investor, Australian Retirement Trust is committed to achieving a net zero greenhouse gas emissions investment portfolio by 2050,” its official statement says.
“Australian Retirement Trust applies exclusions in limited circumstances as part of its sustainable investment approach in accordance with members’ best financial interest.”
The new rule will not affect thermal coal investments made indirectly through other fund managers and does not apply to metallurgical coal, which is crucial for steel-making.
The change aligns with the demands of climate-conscious stakeholders and activists who have long advocated for more responsible investment strategies.
Brett Morgan, a superannuation funds campaigner at Market Forces, praised the move, saying; “It’s a tribute to the thousands of members who have demanded greater climate action from the fund”.
The direct impact on the fund's current investments may be minimal, as major local coal miners like New Hope and Whitehaven Coal were not part of its main fund as of the latest filings in December.
However, the policy update reflects a growing trend among major financial institutions worldwide, which are increasingly divesting from fossil fuels in response to environmental concerns and market shifts towards sustainable energy alternatives.