If spending and investing money is a vote for the world you want to live in, what is your superannuation voting for?
If I gave you about $100,000 to invest, would you buy shares in weapons companies? Would you throw money into live animal exports, detention centres, or coal-seam mining? Would you overlook questionable labour practices to achieve a tidy profit?
The unfortunate truth is, if you’ve invested your superannuation in one of the many default funds, you may inadvertently be doing just that.
The average Australian woman has $121,300 invested in super, and as a country, we have approximately $2.9 trillion in superannuation assets – money that could be doing a lot of good for ourselves and the planet. Yet, when it comes to super, we are largely disengaged.
What is ethical superannuation?
An ethical superannuation fund is one that invests members’ money in socially or ethically responsible ways. The only problem? ‘Ethical’, ‘green’ and ‘sustainable’ are unregulated marketing terms, meaning consumers still need to be aware of what they are purchasing.
Independent Financial Advisor, Jacie Taylor warns, “People have an expectation that the word ‘ethical’ has a specific message and meaning attached to it… It doesn’t. You have to decide which issues are most important to you, research funds, and make decisions on how to invest from there.”
So, how do you discover the ethics your fund, or a prospective fund you are considering, is using to guide its investments? You’ll need to do a little bit of research, says Taylor.
Decide what guides your choice
Dr Matt Beard, Fellow at The Ethics Centre, says you can begin to uncover your own code of ethics by reflecting on some simple questions. “What gets you angry? What breaks your heart? What do you think is worth fighting for? What are some things you would never do, and why?”
Once you’ve thought about the issues that matter most to you, it’s time to get to work researching. Websites such as Market Forces can help you begin to navigate the plethora of funds available from an ethical perspective.
Once you’ve got a shortlist, you’ll need to scrutinise their investment strategy. For example, a fund that claims it excludes animal cruelty practices may still invest in medical research that includes animal testing. As of this writing, the only fund to guarantee they are completely cruelty free is Cruelty Free Super (Australia’s first vegan superannuation fund).
Make a difference in under three minutes
Once you’ve found a fund that you feel is in alignment with your values, you’ll also need to compare fees and insurance offerings.
If you’re finding navigating the murky waters of super a little too intimidating, you can always seek independent financial advice, taking along a list of the issues that matter most to you. However, if you’re comfortable making changes, most of the time this can be done online with a simple switching form – you only need to have your tax file number on hand.
No matter what you choose, superannuation needs to be just that – a choice – something you consider carefully and align with your values. Ultimately, your super isn’t just creating your retirement fund, it’s also a vote for the world you want for your twilight years and the generations after you. You deserve to have a say.
