HESTA has issued a blunt warning to the ASX 300 companies it invests in and says it is going to use voting rights in a push for gender diversity and climate action.
Ahead of the upcoming AGM season in October-November, the superannuation fund, which manages $76 billion largely for health and community services employees has written to the board Chair and CEOs of ASX 300 companies outlining its key priority expectations which also include decent work, and natural capital and biodiversity loss.
For the upcoming voting season, HESTA has announced it will vote against select director re/elections at ASX300 companies where the board has less than 30 per cent female representations and against board Chairs of companies employing single gender executive leadership teams.
“HESTA has an ambition to see gender balance achieved in ASX300 leadership structures, including board and executive teams, by 2030,” it said in a statement. “As we progress toward 2030, there will likely be further changes to our voting policy to ultimately align with gender balance of 40 per cent identifying as women, 40 per cent identifying as men, and 20 per cent any gender (40:40:20) at both board and executive levels.”
Over the coming year, HESTA will also seek to engage portfolio companies on the gendered factors that contribute to the pay gap, including workplace culture and discrimination; the underrepresentation of women in leadership; and the gender segregation of industries.
HESTA CEO Debby Blakey said the super fund’s 2023-24 active ownership priorities “reflect a commitment to responsible investment and engagement for a growing, sustainable and inclusive economy so we can continue to deliver strong returns to our members.”
“In the upcoming AGM season, companies will be engaged not only in their response to immediate risks and opportunities for performance but also in their efforts to promote a sustainable and inclusive economy, benefiting shareholders, members, and all Australians.
“The Fund looks forward to working with companies to address the systemic risks that can impact long- term returns for our members. In doing so, we seek to benefit our members by enhancing the long- term value of Australian companies and pursuing a growing, sustainable, and inclusive economy.”
On climate change, HESTA encourages ASX300 companies to work towards the global goal of halving greenhouse gas emissions by 2030 and achieving net zero greenhouse gas emissions by 2050, in line with the goals of the Paris Agreement to pursue efforts to limit warming to 1.5°C.
“As part of determining votes for upcoming AGMs, HESTA will consider progress in these areas and whether board skills and composition demonstrate preparedness for the low carbon transition.”