The Responsible Investment Association Australasia (RIAA) has announced the appointment of 61 “responsible investment leaders” for the year in Australia, an increase of 11% on the previous year, as it identifies “continued momentum » in responsible investment.
It also identified 29 “responsible investors”, an increase of 26% compared to 2023.
This recognition is based on the RIAA’s Responsible Investment Scorecard, which evaluates asset managers based on their commitment to responsible investing, including the integration of environmental, social and governance (ESG) factors into decision-making, rigorous management and transparency in the communication of societal and environmental results.
According to the RIAA, responsible investing leaders represent the top 20 percent of investment managers assessed, while responsible investors are those who score at least 15 out of 20.
Among the 61 companies recognized as leaders in responsible investing in 2024 were PIMCO, Nanuk Asset Management, Betashares, Ausbil, First Sentier Investors, Nuveen, Magellan, Pendal, T. Rowe Price and Australian Ethical.
Meanwhile, the responsible investors included Equity Trustees, Platypus Asset Management, Vanguard Investments and Pengana Capital.
“It’s incredibly encouraging to see such significant progress, even after raising the standard last year,” said Estelle Parker, co-chief executive of the RIAA, pointing to increased industry oversight and increased regulatory action at the during the past year.
“The fact that more investment managers have met these higher expectations shows that organizations are rising to the challenge and raising the bar.
“Not only are more of them doing it, but they’re also getting better at it. »
Last year saw a number of sustainability allegations thrust into the spotlight, such as the Australian Securities and Investments Commission’s first court victory in March, which saw the Federal Court rule that Vanguard had broken the law by making misleading claims about certain environmental, social and governance (ESG) exclusion criteria applied to investments in an index fund managed by the company.
The fund manager was subsequently penalized $12.9 million.
Similarly, two super funds – Active Super and Mercer Super – broke the law regarding declarations about their sustainability credentials.
Mercer Super was ordered to pay an $11.3 million fine in early August in the Federal Court, while Active Super is expected to appear in court at a later date.
The RIAA’s Parker added that the organization continues to see a “deeper commitment” to responsible investment practices.
“It’s not about short-term adjustments; it’s about taking a holistic, long-term approach to building more sustainable and resilient markets,” she said.
