On the 3rd of March 2022, the Federal Government confirmed its strong expectation that Australian superannuation funds will review their investment portfolios and take steps to divest any holdings in Russian assets.
APRA will not take action for divestment of Russian Assets
Following the Government’s expectations being announced, the Australian Prudential Regulation Authority (APRA) has further advised that it will not be taking any action against trustees who seek to divest Russian assets in this context and where trustees have considered such divestments in accordance with their duties. Data provided to APRA indicates that superannuation fund holdings of Russian assets are a very small proportion of the $3.5 trillion superannuation asset pool.
FSC supports the Government’s expectations and will assist members
The Financial Services Council (FSC) has confirmed that it supports the Federal Government’s expectation that the superannuation industry divests Russian assets as part of broader global economic sanctions to address the humanitarian crisis in Ukraine.
We will work with superannuation trustees and fund manager members to develop guidance that will assist members to:
- implement all sanctions imposed on Russia by Australia;
- eliminate new investments in Russian assets by superannuation funds;
- review their portfolios with a view to winding down exposures to Russian assets not currently subject to divestment sanctions as market conditions permit; and
- have appropriate compliance resources to achieve these objectives.
Superannuation assets are invested through different structures and with different investment strategies, including directly held assets, external mandates, actively or passively managed investments and co-mingled investment arrangements with Australian and international investors.
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