ART extends exclusions in Socially Conscious option

Australian Retirement Trust (ART) will extend its list of exclusions for the Socially Conscious Balanced option to also apply to direct investments in listed corporate-issued debt in fixed income investments.

The change, which comes into effect July 1, extends the exclusions which currently apply alongside direct investments in Australian and international shares.

The exclusions include investing in companies which obtain more than 5% of revenues from thermal coal; metallurgical coal; oil and gas; fossil fuel generation; alcohol; gambling; and adult entertainment.

Additionally, any investment that gets any revenue from tobacco and alternative smoking products, or any company that has any involvement in controversial weapons; nuclear weapons; or live animal exports will also be excluded.

However, ART said there are some exceptions to the exclusions.

"The exclusions do not apply to our investments in pooled vehicles (such as exchange traded funds, unit trusts and fund of funds), or derivatives, or other forms of investment which may expose our portfolio indirectly to companies that meet the criteria and threshold for exclusion," ART said,

"Exclusions also do not apply to investments that are held as security."

In addition, the thermal coal exclusion does not apply to companies deriving revenue from metallurgical coal - or coal used in the production of steel - coal mined for internal power generation, intra-company sales of mined thermal coal, revenue from coal trading, or royalty income for companies not involved in thermal coal extraction operations.

Likewise, the metallurgical coal exclusion does not apply to companies deriving revenue from thermal coal, coal mined for internal use in steel production, intra-company sales of mined metallurgical coal, revenue from coal trading, or royalty income for companies not involved in metallurgical coal extraction operations.

"There will be no changes to the investment approach for this option and we are still committed to offering this option to our members," ART said.

"However, we have decided not to continue seeking certification from Responsible Investment Association Australasia (RIAA) under the Responsible Investment Certification Program for this option."