HESTA chief executive Debby Blakey has urged Australia to expedite efforts to meet the 2030 green targets, highlighting that superannuation returns are at risk if the climate transition does not accelerate.
Blakey has stressed the need for a rapid and orderly transition to renewables to avoid economic and superannuation return impacts.
Australia must double its renewable capacity to meet Labor’s target of 82% by 2030. However, delays in building new-generation projects and the slow rollout of transmission developments have hindered progress.
Blakey noted, “There’s a risk of a transition that is not orderly and that has a very significant impact on the economy, and the ability to deliver returns broadly.”
Need to accelerate efforts
Blakey, who leads the A$83 billion industry super fund for healthcare workers, acknowledged the progress made over the past decade but emphasised the urgency of accelerating efforts in the next five years.
HESTA, a vocal activist investor on climate change, has pushed companies like Woodside Energy, Origin Energy and AGL Energy (ASX:AGL) to hasten their transition plans.
Despite holding minimal stakes in these companies, HESTA has actively used its influence. The fund recently voted against Woodside’s climate plan, citing a “significant gap” in its transition pathway, and proposed its climate-friendly director candidates.
“We have never felt that a small holding means we don’t have an opportunity to use our voice and have a seat at the table,” said Blakey.
Long-term potential
Blakey highlighted the long-term potential of clean energy investments despite recent outflows from environmental, social and governance (ESG) funds saying, “We believe we will get the best returns over the long term by thinking about capital allocation to new energy.”
Supporting the mining sector’s focus on critical minerals, Blakey noted their essential role in the low-carbon transition.
“Mining investments have a long lead time and specific capabilities. To have strong global mining companies that are giving thought to the critical minerals of the future, we see it as outstanding,” she said.