In a landmark case for ASIC, the Federal Court has ordered Mercer Superannuation (Australia) Limited to pay a pecuniary penalty of $11.3 million after it admitted making misleading statements about the sustainable nature and characteristics of some of its superannuation investment options. Mercer was also ordered to publish an adverse publicity notice on the sustainable investments page of its website and to pay ASIC’s costs, agreed at $200,000.
The case concerned misleading statements on Mercer’s website as to the nature and characteristics of financial services that it provided through seven different “Sustainable Plus” investment options offered in the Mercer Super Trust. These statements marketed the Sustainable Plus options as suitable for members who ‘are deeply committed to sustainability’ and represented that they excluded, and would continue to exclude, investments in companies involved in, or deriving profit from the production or sale of alcohol, gambling and the extraction or sale of carbon intensive fossil fuels. In fact, most of these options held investments in 15+ companies in each of these categories.
The case demonstrates the importance of making accurate ESG claims to investors and potential investors and of implementing adequate systems to ensure that ESG claims are accurate.
ASIC’s August 2024 report on interventions on greenwashing misconduct: 2023–2024 can be found here.