ASIC hits Future Super with greenwashing fine over Facebook post

Sydney-based Future Super has become the latest superannuation fund to be hit with alleged greenwashing conduct from the nation’s corporate watching, which claims a Facebook post by the company overstated the positive environmental impact of its $400 million fund.

The Australian Securities and Investments Commission (ASIC) alleges a social media post published in May 2019 with the statement ‘naysayers don’t join together and move nearly $400 million out of fossil fuels’ may have been false and misled consumers.

ASIC said that at the time the post was made, Future Super had around $400 million in total funds under management (FUM) and had no basis to represent that the entirety of those funds had been invested in fossil fuels prior to being invested in the fund.

The move comes two months after the watchdog filed Federal Court proceedings against Mercer Superannuation for greenwashing, alleging the firm made misleading statements about the sustainable nature and characteristics of some of its superannuation investment options.  

The Australian Competition and Consumer Commission (ACCC) has also vowed to investigate a number of companies for greenwashing after an online sweep of 247 Australian firms found more than half exaggerated their environmental claims.

While Future Super paid $13,320 for the infringement notice, payment of the fine is not considered an admission of guilt or liability.

“The post on the Future Super Fund Facebook page overstated the positive environmental impact of the Fund and we were concerned it may be misleading to investors and potential investors,” ASIC deputy chair Sarah Court said.

“‘This action should send a message to the financial services industry that ASIC is continuing to focus on greenwashing broadly, in statements to the market, disclosure documents, marketing material and on social media. Industry using social media to promote green claims are not immune from ASIC action.   

“We expect the industry to be able to stand by their sustainability statements and back these up with evidence.”

Founded in 2014, Future Super has around 50,000 members and invests in four broad asset classes: listed equities (domestic and international), fixed interest (domestic and international), alternatives and cash.

To avoid investing in companies or activities that cause social or environmental harm - such as detention centres, live animal export and tobacco - the firm has an ethical screening process in place.

Future Super also claims to screen out diversified fossil fuel companies, as well as companies providing significant services and financing to the fossil fuel industry. In June 2016, the company was awarded B Corp certification, joining a cohort of 6,000 businesses worldwide that demonstrate high social and environmental performance.

“In 2019 Future Super published a Facebook post that was missing an important caveat,” the company said in a statement.

“Future Super self-reported this to ASIC and paid the infringement as a result on April 27, 2023.”

According to the firm, the poorly drafted post had intended to make the point that $400 million had been switched away from fossil fuel-exposed super funds as opposed to fossil fuel investments. Facebook's analytics indicated the post was seen by under 28 people prior to being taken down.

To avoid a fine, ASIC recommends that any sustainability-related label of a product reflects the substance of the product itself.

Other recommendations include avoiding vague terminology, unsubstantiated sustainability-related statements, misleading headline claims, and disclosing methodologies or policies for how sustainability-related considerations are taken into account.

ASIC has issued more than $150,000 in infringement notices since October 2022, including against Tlou Energy Limited (ASX: TOU), Vanguard Investments Australia, Diversa Trustees Limited and Black Mountain Energy.