• The pension fund has committed a serious violation and gone against investors' values and principles.
• The Australian Securities and Investments Commission is taking all possible measures to avoid such greenwashing attempts.

Australian superannuation fund Active Super has been asked to pay $10.5 million as a fine by the Federal Court for misleading investors about environmental, social, and governance (ESG) and sustainable investments.

According to reports, the fund purportedly avoided investments in gambling, coal mining, and Russian companies (after the invasion of Ukraine). However, it continued investments between February 2021 and June 2023 in companies like SkyCity Entertainment Group (gambling), Gazprom PJSC (Russia), Shell, and Whitehaven Coal.

In June 2024, the Federal Court ruled that Active Super had gone above the law by misrepresenting its investment policies. Through deception, the fund attracted many investors who wanted to invest responsibly.

READ MORE: What Are The Main Greenwashing Tactics Companies Use?

Justice David O’Callaghan said that this went against the values and principles of investors and lasted for a long time, making it a serious violation.

Sarah Court, the deputy chair of the Australian Securities and Investments Commission (ASIC), said that this sends out a strong message to companies making such sustainability claims.

ASIC has been taking all possible measures to crack down on greenwashing and protect stakeholders' rights. This is the third court ruling against greenwashing attempts in Australia, and the regulatory body is taking further actions against funds, companies, and other businesses engaging in greenwashing.

ALSO READ: What Is Greenwashing? Top Examples You Need To Know

In the meantime, Active Super seems to have given short shrift to the Federal Court's ruling. It merged with Vision Super amid these controversies. As of December 2024, it managed $14.7 billion in assets for 86,547 members, compared to $29 billion for 165,000 members previously.

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Source: ASIC