NGS Super Deepens ESG Commitments, Divests in Oil and Gas Sector Investments

Published on: 08 August 2022
by KnowESG
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NGS Super, an industry super fund, has broadened its investment restrictions on fossil fuel producers to include companies engaged in oil and gas production and exploration. NGS is strengthening its commitment to ESG investing by divesting all oil and gas-related stocks.

The super fund said it sold about $191 million worth of assets and put the money into other holdings in the fund's equity portfolio.

Ben Squires, the chief investment officer at NGS Super, said that the fund is currently in charge of $13 billion.

“Companies whose revenue relies on further oil and gas exploration and production are at risk of becoming stranded assets as the world decarbonises, especially if they are solely focused on upstream oil and gas production,” Squires said.

“By divesting these companies, we expect to generate higher returns from allocating capital elsewhere.”

The sustainability-focused super fund, which originated as an industry fund for teachers in private schools, stated that its original baseline measurement was the scope 1 and scope 2 emissions of the Diversified (MySuper) investment option.

Scope 1 refers to direct emissions from a business or company as a result of their operations, whereas scope 2 refers to indirect emissions from the generation of purchased energy from a utility provider.

Before the statement on August 4, its divestment regulations only applied to investments with more than 30 per cent of revenue from distribution, electricity generation, or thermal coal extraction.

Source: Probonoaustralia

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