Analysis of ‘socially responsible investment’ options

  • ‘Socially responsible investment’ options are niche products that account for a very small share of the total Australian superannuation market.
  • The vast majority of super funds do not have an SRI default option.
  • SRI options tend to underperform conventional options (with similar asset allocations) over long investment horizons (after fees and tax).
  • A number of unlisted infrastructure investments are essentially investments in fossil fuel production
  • Divestment from fossil fuels could produce an unbalanced portfolio (i.e. reducing diversification and potentially increasing volatility).

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