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Socially Conscious Balanced

This option invests in a diversified portfolio aligned with a more extensive set of environmental, social, and governance (ESG) principles than our other investment options. If you're a long-term investor, it may suit you.

Summary

As at 30 September 2023 (updated quarterly)

6.6% p.a.

Returns over the last 10 years1

5+ years

Suggested timeframe

0.65% p.a.

Fees (p.a.) + admin fees and costs

Overview

We employ multiple responsible investment approaches. These include screening for shares (exclusions), ESG integration, sustainability-themed investing, and stewardship as set out in our Super Savings Investment Guide. This is in addition to our approach to sustainable investing for other available options.

Investment objective2

Investment objective for Accumulation and Transition to Retirement (TTR) Income accounts: CPI + 3.5% p.a.
Investment objective for Retirement Income accounts: CPI +4.0% p.a.

Option size

Super assets: $357.4 million
Pension assets: $82.3 million

Risk2

 
  • Very low
  • Low
  • Low to medium
  • Medium
  • Medium to high
  • High
  • Very high

Expected number of years of negative returns over any 20-year period: 4 to less than 6. The risk is based on the standard risk measure (SRM).

Socially Conscious Balanced performance overview

As at 30 September 20231 (updated quarterly)


The Socially Conscious Balanced (SCB) option returned -0.5% over the September quarter, and 8.4% over the year to September 2023. Over the quarter, inflation and interest rate concerns have remained a key focus for financial markets.

In addition, ongoing concerns over China’s growth prospects and worries over the inability of the US Congress to approve spending measures and prevent a US government shutdown also weighed on sentiment. After recording strong gains in the first half of 2023, global equity markets declined in the September quarter. Against this backdrop, the SCB listed shares portfolio underperformed the broader equity market.

From a sector viewpoint, the largest contribution to relative returns came from selection in Health Care and Industrials, while the zero weight in Energy and stock selection in Materials, Information Technology and Financials detracted the most.

Infrastructure was added to the SCB option in April 2023, outperforming public markets over the quarter. In the SuperRatings Sustainable Fund survey for September 2023, the performance of the SCB option was ahead of the median sustainable fund over 1, 3, 5, and 7 years to the end of September 2023.

Accumulation accounts Retirement Income accounts3
10 years (p.a.) 6.6% 7.3%
7 years (p.a.) 6.7% 7.4%
5 years (p.a.) 5.8% 6.4%
3 years (p.a.) 7.2% 8.0%
1 year 8.4% 9.5%
3 months -0.5% -0.6%

Past performance isn't a reliable indicator of future performance. Returns shown are after investment fees, indirect costs and investment taxes (where applicable) but before administration fees. Investment tax doesn't apply to Income accounts.

Socially Conscious Balanced asset allocations

By value as at 30 September 2023


 

Asset allocations4
Australian shares
25.3%
International shares
27.0%
Private Equity
5.8%
Property
10.2%
Infrastructure
10.2%
Fixed Income
16.4%
Alternative Strategies
3.1%
Cash
2.0%
Total 100%

The following exclusions apply to the SCB option's Australian and international shares asset classes:

Exclusions1 Description of exclusion criteria Exclusion threshold
Thermal coal Mining of thermal coal (including lignite, bituminous, anthracite and steam coal) and its sale to external parties. 5% gross revenue (reported or estimated) threshold in most recent year of financial reporting
Metallurgical coal Mining of metallurgical coal (including coking coal) and its sale to external parties.
Oil and gas Extraction and production or refining of oil and gas.
Fossil fuel power generation Thermal coal, liquid fuel, and natural gas-based power generation.
Alcohol Companies that manufacture alcoholic products, including brewers, distillers, and vintners. It also includes companies that own or operate wine vineyards.
Gambling Companies that operate gambling facilities such as casinos, racetracks, bingo parlours, or other betting establishments.
Adult entertainment2 Companies that produce adult entertainment materials. 
Tobacco and alternative smoking products3 Companies that manufacture tobacco products, or products aimed to replace or supplement tobacco products.  No threshold (companies deriving any revenue from the manufacturing of these products are excluded)  
Controversial weapons Companies that have any tie to controversial weapons (cluster munitions, landmines, biological/chemical weapons, depleted uranium weapons, blinding laser weapons, incendiary weapons, and/or nondetectable fragments).   
Nuclear weapons Companies that have an industry tie to nuclear weapons. 
Live animal exports Australian shares companies that own and/or operate live animal export operations.  Australian shares companies identified by internal desktop research to own and/or operate live animal export operations 

Exceptions to these exclusions

The screening criteria does not apply to pooled vehicles or derivatives, which may have indirect exposure to companies exceeding the negative screens.

The thermal coal and metallurgical coal exclusions do not apply to companies deriving revenue from coal mined for internal power generation, intra-company sales of mined thermal and metallurgical coal, or revenue from coal trading.

The implementation of the exclusions above (other than the exclusion concerning live animal exports) relies upon accuracy of data from a third-party provider (MSCI).

Sometimes we may accept excluded listed shares as part of super fund mergers. In this instance, we seek to divest in a manner aligned with members’ best financial interests, usually within 30 days. Exclusion lists are updated twice yearly. Following those updates, we inform external investment managers which listed equity shares are required to be excluded from new and existing investments.

For other asset classes to which the negative screens referred to above do not apply, we still take steps to integrate consideration of material ESG risks and opportunities into investment decisions we make for the Super Savings ESG options as set out in the Super Savings Investment Guide.

Footnotes

  1. Thermal coal, oil and gas, and fossil fuel power generation exclusions are based on MSCI ESG Climate Change Metrics Methodology (November 2022) and associated universe coverage. The metallurgical coal exclusion uses data supplied through, and defined within, MSCI ESG Manager platform. The alcohol, gambling, adult entertainment, tobacco and alternative smoking products, controversial weapons, and nuclear weapons exclusions use MSCI ESG Business Involvement Screening Research Methodology (October 2022) and associated universe coverage. The live animal export exclusion applies to listed Australian shares companies, and internal desktop research is conducted by Australian Retirement Trust
  2. Companies that produce adult entertainment materials that fall into the following six categories: producer of X-rated films, producer of pay-per-view programming or channels, producer of sexually explicit video games, producer of books or magazines with adult content, live entertainment of an adult nature, producer of adults-only material on the internet.
  3. Tobacco and alternative smoking products refers to companies that manufacture tobacco products (or products aimed to replace or supplement tobacco products), such as cigars, blunts, cigarettes, e-cigarettes, inhalers, beedis, kreteks, smokeless tobacco, snuff, snus, dissolvable and chewing tobacco. This also includes companies that grow or process raw tobacco leaves.

Socially Conscious Balanced shareholdings

Largest holdings by value as at 30 September 2023 (updated quarterly)


Australian Shares (top 10)

Commonwealth Bank of Australia

CSL Ltd

Australia and New Zealand Banking

Macquarie Group Ltd

Wesfarmers Ltd

Fortescue Metals Group

Westpac Banking Corp

National Australia Bank Ltd

QBE Insurance

Super Retail Group Ltd

International Shares (top 10)

Apple Inc

Microsoft Corp

Nvidia Corp

Reliance Steel and Aluminum Co

Costco Corp

Alphabet Inc

ASML Holding VN

Merck & Co

Amazon Com Inc

LPL Financial Holdings

View all holdings

Outlook and strategy

As at 30 September 2023 (updated quarterly)


We do not design portfolios based on our own or anyone else’s short-term economic, market or geopolitical forecasts. However, our investment team and our external investment managers do seek to capitalise on opportunities that inevitably emerge during times of heightened market volatility.

The SCB option continues to hold a substantial allocation to unlisted asset classes, particularly real estate, infrastructure and private equity. We have diversified portfolios of these assets that we expect will deliver strong, long-term returns, while reducing our members’ exposure to share market volatility.

ART’s Dynamic Asset Allocation (DAA) strategy slightly favours shares over bonds, although we have increased our exposure to UK and US bonds as yields are now more attractive. Within the DAA strategy, we have a slight preference for UK and Japanese shares over shares in the US and Australia.

RIAA certified logo

Have confidence in an independently certified fund

Our Socially Conscious Balanced option is a certified responsible investment option.5

The SCB option has been certified by the Responsible Investment Association Australasia (RIAA) according to the strict operational and disclosure practices required under the Responsible Investment Certification Program. See the RIAA website for details.

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  1. Past performance isn't a reliable indicator of future performance. Returns shown are after investment fees and costs, transaction costs, and investment taxes (where relevant) but before admin fees and costs. Returns up to 28 February 2022 are for Sunsuper, and after that are for Australian Retirement Trust using the same products.
  2. When reading the objectives and/or risks please also read the information in the Super Savings Investment Guide under 'Risks of our investment options' and 'Important information about expected returns'.
  3. Tax generally doesn't apply to investment earnings in Retirement Income accounts.
  4. For additional information on these asset classes, strategic asset allocations, and allowable ranges, read the Super Savings Investment Guide. Note that the effective asset allocation takes into account both the physical exposures to assets along with the effective market exposure from derivative instruments such as futures. These instruments are used by Australian Retirement Trust to bring effective market exposures closer to those represented by each option’s strategic asset allocation.
  5. RIAA’s RI Certification Symbol signifies that a product or service offers an investment style that takes into account environmental, social, governance or ethical considerations. The Symbol also signifies that the Socially Conscious Balanced option adheres to the strict operational and disclosure practices required under the Responsible Investment Certification Program for the category of Product. The Certification Symbol is a Trademark of the Responsible Investment Association Australasia (RIAA). Detailed information about RIAA, the Symbol and Socially Conscious Balanced option’s methodology, performance and stock holdings can be found at www.responsiblereturns.com.au, together with details about other responsible investment products certified by RIAA. The Responsible Investment Certification Program does not constitute financial product advice. Neither the Certification Symbol nor RIAA recommends to any person that any financial product is a suitable investment or that returns are guaranteed. Appropriate professional advice should be sought prior to making an investment decision. RIAA does not hold an Australian Financial Services Licence.