Antinuclear

Investment – superannuation funds should be going for renewable energy

Wrestling with a climate conundrum, Sydney Morning Herald, 19 Feb 2011, IT’S maddening. We have brilliant renewable energy resources, brilliant innovators and a vast pool of superannuation savings looking for opportunities beyond our overvalued, over-analysed, ticket-clipped top 50 listed companies.
We also have growing recognition that climate change poses a unique risk to traditional investment management strategies – particularly here in Australia, where up to 40 per cent of a typical share portfolio might be concentrated in sectors such as resources, which are heavily exposed to a rising price on carbon.

Why can’t we join the dots, for example, between a report like Zero Carbon Australia’s Stationary Energy Plan, which last year called for investment of $370 billion over a decade to switch this country to 100 per cent renewable energy by 2020, and a report out this week by the actuarial consultants Mercer, called Climate Change Scenarios – Implications for Strategic Asset Allocation, urging super fund trustees to divert up to 40 per cent of their investments to so-called climate sensitive assets, those suited to a low-carbon economy, for the potential upside and because it could reduce portfolio risk.

Why can’t we? Why can’t we? Why can’t we?

Many reasons can be advanced, of course – and some of them are sound……

But in climate change we face a crisis unlike any we have faced before. Mercer writes that while some climate sensitive assets may be traditionally deemed as more risky on a standalone basis, selected investments could reduce portfolio risk…..

Wrestling with a climate conundrum

February 19, 2011 - Posted by Christina Macpherson | AUSTRALIA - NATIONAL, business