Australia’s Federal Court has found superannuation fund Active Super guilty of making misleading claims concerning its environmental, social and governance (ESG) credentials, the country’s securities regulator said on Wednesday.

The Australian Securities and Investments Commission (ASIC) had sued Active Super last year, disputing the fund’s claims that it no longer held investments in gambling, coal mining and oil tar sands, and that it had exited Russian investments.

The court found that between February 2021 and June 2023, Active Super invested in various assets that it had said were eliminated or restricted by ESG investment screens, the regulator said in a statement.

At the time of making the misleading claims, Active Super had stakes in gambling company SkyCity Entertainment (SKC.NZ), opens new tab, Russian firm Gazprom (GAZP.MM), opens new tab and coal miner WhiteHaven Coal (WHC.AX), opens new tab, among others, the regulator said.

“ASIC took this case because it sends a strong message to companies making sustainable investment claims that they need to reflect their true position,” ASIC Deputy Chair Sarah Court said.

The court will consider a penalty to impose for Active Super’s conduct at a later date, the regulator said.
A spokesperson for Active Super said the fund co-operated with the investigation and “welcomes increased scrutiny on ESG disclosure standards as being good for members, the super industry and the community.”

The A$13.5 billion ($8.98 billion) superannuation fund is considering the judgment and its next steps, the spokesperson added.

($1 = 1.5033 Australian dollars)

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