Carbon intensity of VicSuper’s equities portfolio

VicSuper measures the greenhouse gas emission associated with our equity investments by measuring the carbon footprint and intensity of our equities portfolio. At the end of April 2016, our equities investments represented approximately A$9.3 billion and approximately 58% of our entire portfolio.A carbon intensity measure allows us to compare the greenhouse gas intensity of our portfolio year-on-year, despite our funds under management increasing over time. In 2016 the carbon intensity of the equity portfolio was 280 tonnes of CO2e/A$M. This is 17% lower than the intensity reported last year (336 CO2e/A$M in 2015). Since 2008, when we began measuring our carbon footprint, the intensity of the portfolio has decreased by approximately 21%.
 

Carbon footprint

*In 2013, the benchmark was changed from the MSCI World ex Australia Index to the MSCI All Country World Index. In 2016 the benchmark was changed from the MSCI All Country World Index to a custom benchmark which more closely mirrors the allocation to international, Australian and emerging market investments in VicSuper’s equity portfolio.

Why do we measure the carbon intensity of our investments?

VicSuper invests in thousands of companies, across the global economy. So we need to understand and manage our portfolio climate risks. Measuring the amount of greenhouse gas associated with the equity investments in our portfolio contributes to understanding where carbon risks and opportunities sit within the portfolio.

What do the trends mean?

We aim to reduce the carbon intensity of the portfolio without negatively impacting risk adjusted investment performance.2 Our strategy of integrating Environmental, Social and Governance factors into our investment process helps us to manage carbon risks. We also actively engage with many of the companies we invest in to help them improve how they manage carbon risk and the transition to a low carbon economy.

How is our carbon intensity calculated?

VicSuper engages the UK-based, research company Trucost to measure the carbon footprint and intensity of VicSuper Fund's listed equities. Trucost estimates carbon efficiency and quantifies carbon risk based on data publicly disclosed by the companies in our portfolio. More information on the calculation methodology applied can be found on the Trucost website.

At present VicSuper only measures the greenhouse gas emission associated with the equity component of our portfolio. We have not sourced robust data on carbon emissions for the other asset classes that we invest in.
Please note that the carbon intensity of VicSuper's portfolio may fluctuate over time depending on the holdings within VicSuper’s investment portfolio.

VicSuper measures the greenhouse gas emission associated with our equity investments by measuring the carbon footprint and intensity of our equities portfolio. At the end of April 2016, our equities investments represented approximately A$9.3 billion and approximately 58% of our entire portfolio.A carbon intensity measure allows us to compare the greenhouse gas intensity of our portfolio year-on-year, despite our funds under management increasing over time. In 2016 the carbon intensity of the equity portfolio was 280 tonnes of CO2e/A$M. This is 17% lower than the intensity reported last year (336 CO2e/A$M in 2015). Since 2008, when we began measuring our carbon footprint, the intensity of the portfolio has decreased by approximately 21%.
 

Carbon footprint

*In 2013, the benchmark was changed from the MSCI World ex Australia Index to the MSCI All Country World Index. In 2016 the benchmark was changed from the MSCI All Country World Index to a custom benchmark which more closely mirrors the allocation to international, Australian and emerging market investments in VicSuper’s equity portfolio.

Why do we measure the carbon intensity of our investments?

VicSuper invests in thousands of companies, across the global economy. So we need to understand and manage our portfolio climate risks. Measuring the amount of greenhouse gas associated with the equity investments in our portfolio contributes to understanding where carbon risks and opportunities sit within the portfolio.

What do the trends mean?

We aim to reduce the carbon intensity of the portfolio without negatively impacting risk adjusted investment performance.2 Our strategy of integrating Environmental, Social and Governance factors into our investment process helps us to manage carbon risks. We also actively engage with many of the companies we invest in to help them improve how they manage carbon risk and the transition to a low carbon economy.

How is our carbon intensity calculated?

VicSuper engages the UK-based, research company Trucost to measure the carbon footprint and intensity of VicSuper Fund's listed equities. Trucost estimates carbon efficiency and quantifies carbon risk based on data publicly disclosed by the companies in our portfolio. More information on the calculation methodology applied can be found on the Trucost website.

At present VicSuper only measures the greenhouse gas emission associated with the equity component of our portfolio. We have not sourced robust data on carbon emissions for the other asset classes that we invest in.
Please note that the carbon intensity of VicSuper's portfolio may fluctuate over time depending on the holdings within VicSuper’s investment portfolio.