The Sustainable Balanced and Sustainable High Growth options specifically seek to invest in companies that are considered sustainability leaders whilst also screening out companies with material exposure to alcohol, gambling, weapons and fossil fuel exploration and production (in addition to the Fund-wide screen on tobacco companies).
UniSuper determines the investable universe of its Australian Shares by firstly applying a negative screen to the ASX200 index excluding stocks that have material exposure to the excluded sectors of alcohol, tobacco, gambling, weapons and fossil fuel exploration and production.
Secondly UniSuper applies a positive screen by a specialist ESG research firm so as to optimise the investment universe with regard to ESG factors whilst maintaining sector exposures as close as possible to the broader Australian share market (ASX200).
UniSuper’s Equities team is responsible for stock selection and portfolio construction. The Sustainable Australian Equities portfolio is actively managed. In addition to the above, UniSuper holds direct positions in a select group of stocks considered to be ‘moderate risk’ equity stocks that meet certain investment metrics typical of high quality companies, and approved by UniSuper’s Investment Committee. For international shares, the negative and positive screening processes are embedded in the methodology underpinning the custom Dow Jones Sustainability World Index ex Alcohol, Tobacco, Gambling, Armaments & Firearms and Energy and Diversified Metals & Mining (customised for UniSuper). The Sustainable International Equities portfolio is passively managed by an external fund manager against this custom benchmark. UniSuper’s Property investment team actively manages the Australian Listed Property portfolio and selects companies from the S&P/ASX200 Australian Real Estate Investment Trust (A-REIT) Index.
The investable universe (by definition) does not have any exposure to the excluded sectors (which acts in place of the negative screening process applicable for the Australian and international equities portfolios). In managing this portfolio, an assessment is undertaken of sustainability criteria, recognising that sustainability is a key driver of quality stocks in the sector.
UniSuper’s Fixed Interest investment team actively manages the Green Bonds portfolio (which is one of the underlying portfolios in the Cash & Fixed Interest allocation for the Sustainable Balanced option).