The Federal Court today imposed a penalty of $10.5 million against Active Super for greenwashing.
In June 2024, the Federal Court found that Active Super contravened the law when it invested in various securities that it had claimed were eliminated or restricted by its environmental, social and governance (ESG) investment screens.
“This is a significant penalty that sends a strong message to companies making sustainable investment claims that those claims need to reflect the true position,” said ASIC deputy chair Sarah Court.
“This case demonstrates ASIC’s commitment to taking on misleading marketing and greenwashing claims made by companies promoting financial services.
“It is our third greenwashing court outcome, and we will continue to keep greenwashing in our sights.’
Active Super claimed in its marketing that it eliminated investments that posed too great a risk to the environment and the community, including gambling, coal mining and oil tar sands. Following the invasion of Ukraine, Active Super also made representations that Russian investments were “out”.
However, contrary to these representations, Active Super held direct and indirect investments in companies such as SkyCity Entertainment Group Ltd (gambling), Gazprom PJSC (Russian entity), Shell Plc (Oil tar sands) and Whitehaven Coal (Coal mining).
Justice O’Callaghan the fund benefitted from its misleading conduct by misrepresenting the “ethical” nature of a significant part of its investments, which on any view enhanced its ability to attract investors.
Last year corporate regulator ASIC landed its first greenwashing case with Mercer Superannuation ordered by the Federal Court to pay a $11.3 million penalty.
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