Mr Gibbs said: “It has been a privilege to serve as Chair of Australian Ethical through a time of great progress for the company and the sector. As Australian Ethical marks 40 years of ethical investment leadership, I am deeply proud of what the Board, management team and our people have achieved together. I have great confidence in the strength of the business, the quality of the Board and the momentum behind Australian Ethical’s purpose and strategy. I look forward to supporting an orderly transition over the coming months.”

On behalf of the Board, Managing Director John McMurdo said: “Steve has been a remarkable steward of Australian Ethical. Under his leadership, the company has grown from $700m in funds under management to $14.5 billion and joined the ASX300. Steve has embodied the purpose of the organisation — investing for a better world — and is widely acknowledged across the sector as a passionate and committed advocate for a more sustainable planet and better outcomes for people and animals. Steve will leave Australian Ethical next year with the deep gratitude of the Board, management, shareholders and the many stakeholders and causes he has so successfully supported and championed.”

Australian Ethical has been undertaking a Board renewal process over recent years, with Brian Bissker appointed to the Board in 2025 and Karen Orvad appointed in early 2026. The company is also well advanced in the selection process to appoint two further directors in the first half of 2027. Mr Gibbs has agreed to remain as Chair until no later than 30 June 2027 to support a successful transition.

Mr Gibbs will also retire from the Australian Ethical Foundation by 30 March 2027, and from Australian Ethical Superannuation Pty Limited by 31 December 2027.

This announcement is authorised by the AEI Board.

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John McMurdo

Australian Ethical, a leading ethical fund manager, has announced the launch of the Australian Ethical Balanced Income Fund, developed in collaboration with Australian Impact Investments (‘Aii’).

The Fund has been designed for values-driven wholesale investors, including foundations and not-for-profits, seeking to invest in line with their mission. The fund applies Australian Ethical’s unique Ethical Charter across a multi-asset balanced portfolio and includes a dedicated impact allocation backed by the expertise of Aii.

The underlying Australian Ethical multi-asset strategy has a 36-year track record combining institutional-grade listed, private, and alternative assets and accesses real-economy opportunities across infrastructure, private debt, and sustainable assets led by Australian Ethical and it’s Ethical Charter. Aii will contribute specialist expertise in impact sourcing, due diligence, measurement and reporting to the impact sleeve that is designed to deliver positive, measurable social and environmental outcomes.

Philanthropic trusts and foundations in Australia manage more than $50 billion in investible assets^[1], making their financial decisions a powerful lever for long-term stewardship. Sector research shows many foundations and not-for-profits are taking a more deliberate approach to how their capital is invested, looking beyond grant making to better align their investments with their purpose^[2].

Australian Ethical Chief Executive Officer and Managing Director John McMurdo said trustees are increasingly recognising that it’s not enough for investments to generate income for grants if the underlying capital may be contributing to the very challenges their organisation exists to address.

“Foundations and not-for-profits have told us they want to manage their capital responsibly, while upholding their fiduciary responsibility to preserve and grow capital over time. This Fund has been designed to bridge that gap, bringing together income, diversification and a clear focus on impact within a single, professionally managed portfolio. It’s about giving organisations confidence their capital is working consistently with their purpose, without compromising on the financial outcomes they rely on,” Mr McMurdo said.

Australian Impact Investments Managing Director Kylie Charlton said: “We’re pleased to be partnering with Australian Ethical on a product that responds to the growing demand from foundations and not-for-profits to invest in line with their mission and values. With more than a decade of experience in impact asset consulting, we know that aligning capital is only part of the equation – investors want to understand how their investments are performing financially and confidence that their capital is contributing to a better society and healthy planet. Transparent annual impact reporting is an important part of that.”

The Reichstein Foundation, an Australian philanthropic foundation focused on social and environmental justice, is a cornerstone investor in the Fund. Reichstein Foundation CEO Rachel Ball said the Foundation was increasingly focused on ensuring its investment capital was aligned with its purpose: “As purpose-driven investors, we look for investments that can deliver financial returns and measurable impact. The Balanced Income Fund provides foundations like ours with a practical way to do both, aligning investment capital with purpose, while maintaining the diversification and financial outcomes needed to support our long-term objectives. We see this as an important development for the philanthropic sector as demand for values-aligned investment solutions continues to grow.”

While developed specifically for foundations and not-for-profits stewarding perpetual capital, the Fund also has broader relevance for wholesale investors seeking a professionally managed diversified balanced portfolio with an embedded impact allocation.

Australian Ethical Chief Investment Officer Ludovic Theau said: “Foundations and not-for-profits are increasingly looking to evolve how they invest their capital, but many don’t want the complexity of building and managing a bespoke solution. This Fund provides an implementation-ready approach – bringing together diversification, income and a dedicated allocation to impact within a single portfolio, supported by clear governance and reporting.”

The Fund targets CPI + 4.0% real returns over the long-term to support sustainable distributions, combining income generation, capital growth and diversification with exposure to investments designed to deliver positive, measurable social and environmental outcomes. It will provide transparent financial and impact reporting and monthly liquidity subject to availability.

Notes:
[1] Australian Charities and Not-for-profits Commission. (2025). Australian Charities Report 11th Edition.
[2] Sector initiatives such as the Endowments for Impact Challenge highlight that grant making is only part of the picture in its latest (2025) report. Philanthropy Australia has since elaborated on these findings, highlighting the growing recognition that the way capital is invested is as important as how it is distributed.

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Commenting on Richard’s departure, AEI’s Chair Steve Gibbs said: “Richard has brought deep investment insight and a strong commitment to responsible and impact‑led investing, and we thank him for his valuable contribution and service to Australian Ethical. We congratulate him on this exciting role at the Future Fund and wish him all the best for the future.

Reflecting on his time on the AEI Board, Richard Brandweiner said: “It has been a privilege to serve on the Board of Australian Ethical during a period of significant growth and capability building for the organisation. Australian Ethical is a for purpose and for-profit business that for 40 years has pioneered ethical investing, leading the industry and role modelling best practice. I’ve always believed that investing can and should deliver both positive returns and positive impact, so it was a real privilege to support an organisation that walks the talk in this respect, and I leave confident in its long‑term direction and continued ability to deliver positive outcomes for members, investors and the wider community.”

Richard joined the AEI Board on 1 September 2024, and his resignation is effective from 4 May 2026.

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Ludovic Theau

A leading ethical fund manager, Australian Ethical, has announced the expansion of its private markets offering with the launch of its Australian Ethical Growth Opportunities Fund providing institutional grade ethical private markets investment to wholesale investors.

Australian Ethical’s Growth Opportunities Fund has received Australian Government backing via the Clean Energy Finance Corporation (CEFC) with a cornerstone commitment up to $125 million, alongside a $500 million seed investment from Australian Ethical.

The Fund provides wholesale investors access to an institutional grade, scalable, diversified portfolio of private markets investments designed to deliver both market rate returns and measurable impact. It is an open-ended fund that blends investments alongside like-minded institutional capital, delivering purposeful, long-term exposure to unlisted real assets.

It follows five key thematics: decarbonisation, digitalisation, urbanisation, circular economy and changing demographics, and employs impact measurement to assess the net benefit of each investment. Initial investments include recycling infrastructure, renewable energy and battery storage, renewable data centres, and aged care facilities.

In addition, every investment is aligned to Australian Ethical’s Ethical Charter, which guides how capital is allocated to create positive outcomes while avoiding unnecessary harm to people, planet and animals.

Australian Ethical Chief Investment Officer Ludovic Theau said: “The biggest opportunity to capitalise on and support Australia’s net zero transition is in private markets. We’re leveraging our expertise, capability and networks to partner with some of the best specialists and managers to democratise access to these opportunities for wholesale channels, and we’re co-investing capital to take advantage of and support these opportunities together.

“We’re pleased to receive the support of the Australian Government through the partnership with the CEFC on this Fund. With the road to net-zero before us, this Fund allows investors to capitalise on the long-term growth opportunity this presents and feel good about where their money is invested.”

According to a McKinsey report for the Business Council of Australia, a 2035 climate target north of 60 per cent will require more than $400 billion in new capital investment from government and industry.

CEFC Executive Director, Heechung Sung said: “This investment demonstrates how the CEFC can use its existing assets to help catalyse new market offerings and support the next phase of growth for sustainable finance.

“By backing a new institutional vehicle with CEFC investments, we are helping to establish a scalable platform for climate-focused assets, crowding in capital and expanding the reach of sustainable finance to a broader audience to accelerate Australia’s decarbonisation.”

Australian Ethical’s Head of Private Markets Adam Roberts said: “Australian Ethical’s Growth Opportunities Fund gives wholesale investors access to a wide range of impactful private investments providing immediate diversity without having to commit and tie-up large amounts of capital in a single private equity or venture capital investment.

“Drawing on two decades of impact investing experience, we apply institutional rigour and active industry engagement to identify solutions to global challenges. We invest where we see enduring tailwinds and the potential for attractive long-term, risk adjusted returns.”

The Fund has an Impact Advisory Forum that is separate to the Fund’s investment team, who review and monitor the impact reporting across the portfolio. It aims to deliver 11-13% per annum (after fees and expenses) over 7-year periods whilst providing quarterly liquidity.

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Karen is a highly experienced Non-Executive Director, Board Chair, and Audit and Risk Chair.

Having started her Chartered Accounting career at KPMG in 1997, Karen gained expertise across external audit and people and culture consulting before moving into the risk and governance advisory practice where she was appointed Partner in 2015. During her time at the firm, she led national and international teams advising on board governance, culture, risk management and internal audit programs for a range of listed clients including some of the worlds most recognised brands.

Since retiring from the partnership in 2018, Karen has held senior executive audit and risk roles in ASX listed companies in both the aviation and financial services sector and developed a diverse and impact-focussed board portfolio.

Australian Ethical Investment Chair, Steve Gibbs said: “We are fortunate to have someone of Karen’s calibre join the Board. She has a distinguished track record in governance, audit and risk as well as defining and developing strong organisational and team cultures. Karen’s skills will be an important addition to our Board as we continue our focus on building the business resilience and governance practices appropriate for us to scale over the coming years.

Karen’s appointment is part of an ongoing Board renewal program at Australian Ethical Investment and follows the appointment of Brian Bissaker (former CEO of Colonial First State and Virgin Money) in April 2025 and the retirement of Kate Greenhill from the Board in October 2025. The Board renewal program also extends to the Australian Ethical Superannuation Board with the recent announcement that Mark Puli (former CEO of ESSSuper) joined the AES Board in February 2026,

Karen is also currently: the Chair of top tier social and affordable housing not-for-profit, St George Community Housing (SGCH);  a Non-Executive Director and Chair of the Risk and Audit Committee of a significant for-purpose provider of  residential aged care, retirement living and homecare services, Bolton Clarke; Deputy Chair of Aspect ( Autism Spectrum Australia), a not-for-profit  providing education and support services to autistic children and adults; and Non-Executive Director and Chair of the Audit, Risk and Finance Committee of AusPayNet (Australian Payments Network), a membership organisation facilitating innovation and governance around the future of payments in Australia. She is also an independent member of the NSW Treasury and Energy Co Audit and Risk Committees.

Speaking about her appointment, Ms Orvad said:  “I’m pleased to join the Australian Ethical Board. It’s a very strong business, well positioned for further growth over the coming years. I’m looking forward to sharing my audit, risk and regulatory experience to support business resilience and the delivery of the strategy.”

“I very much believe in Australian Ethical’s mission and in the role that ethical investing plays in delivering strong long-term returns while investing for a better world. It’s an exciting time to join the Board and the broader team.”

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Dion Cooney

Australian Ethical Investment has announced the appointment of Dion Cooney to its investment team as an Equities Trader, effective 1 December 2025

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Anthony has more than 25 years’ experience across legal, investment, transformation and operational efficiency within superannuation, investment management, financial advice and banking services organisations. Prior roles include COO at MLC Wealth, Global COO at Mercer Investments, and Group Executive, Risk & Governance at Colonial First State. Most recently Anthony has been consulting to Australian Retirement Trust.

As COO, Anthony will report directly to CEO, John McMurdo, and become a key member of the Executive Leadership Team. The role is responsible for overseeing Australian Ethical’s day-to-day operations and driving strategic initiatives to support growth, resilience and efficiency.

Australian Ethical Managing Director and CEO, John McMurdo said, “I’m delighted that Anthony will be joining our business at this exciting time. We have made significant progress in the development of a modern operating platform designed to help us scale with efficiency and resilience. Anthony’s skills and expertise will ensure we effectively leverage and grow the capability we now have.”

Anthony Lane said, “I’m thrilled to be joining the team at Australian Ethical and am excited about the opportunity to support the continued growth of the organisation. Over the past few years, Australian Ethical has taken steps to build strong superannuation and investment operating foundations and I look forward to helping the business capitalise on its investment for its members and investors and continue to enhance its operating efficiency.”

Anthony joins Australian Ethical as the investment manager announced it has exceeded the milestone of $14bn in funds under management.

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John McMurdo

Summary:

• ASX: AEF reports record FUM of $13.94 billion (an increase of 34% on FY24)
• Growth in revenue (19%), UPAT (29%), and NPAT^[1](68%) compared to the prior (FY24) year
• UPAT drivers include organic growth in net flows, strong investment performance, the acquisition of Altius Asset Management and disciplined cost management
• Further operating leverage improvement with underlying cost to income ratio of 71.4% compared to 73.7% in FY24 

Australian Ethical Investment Limited (ASX: AEF) has announced its financial results for the year ending 30 June 2025, with Underlying Profit After Tax (UPAT) of $23.8 million, up 29% on FY24 and Net Profit After Tax (NPAT) attributable to shareholders of $19.9 million, up 68% on FY24.

The ethical investment manager reached a new Funds Under Management (FUM) record of $13.94 billion. This was 34% up on 30 June 2024.

Growth in FUM was driven by continued positive net flows (including record Superannuation Guarantee and year-end voluntary contributions), the acquisition of the Altius business, and investment performance over the period.

Managing Director, John McMurdo said today: “I’m particularly pleased that the investment performance over the period has delivered positively for our members in the Multi Asset superannuation options and for investors across a range of our funds^[2]”

“Momentum across our business over the last five years means we have grown more than threefold, from $4.05 billion FUM at 30 June 2020 to nearly $14 billion today, with underlying EPS growing at a 20% compound average growth rate over this period.

“Our continued FUM growth has underpinned a 19% increase in revenue, 29% increase in underlying profit after tax, and delivered a record $2.8m donation to the Australian Ethical Foundation”

Financial highlights

• Record underlying profit after tax (UPAT) of $23.8 million, up 29% on FY24
• Statutory net profit after tax (NPAT) attributable to shareholders of $19.9 million, up 68% on FY24
• Revenue up 19% to $119.4 million
• Operating expenses of $84.5 million up 14% (excluding integration and transformation costs, amortisation of Altius intangibles and due diligence and transaction costs)
• Underlying cost to income ratio improvement to 71.4% compared to 73.7% in FY24^[3]
• Underlying diluted EPS^[4]of 20.90 cents, up from 16.44 cents in FY24
• Final dividend of 9 cents per share, fully franked. Total FY25 dividend of 14 cents, up 56% on FY24
• Record donation to the Australian Ethical Foundation of $2.8 million^[5]
• Strong balance sheet, no gearing, well managed operating cash flow

Operating Highlights

• FUM up $3.5 billion compared to 30 June 2024
• Positive organic net flows of $593 million
• Acquisition of Altius business, adding $1.93 billion FUM with net outflows since acquisition of $71 million
• Positive investment performance^[6] of $1.05 billion
• Transition of majority of members to GROW Inc for super administration and transition of custody and investment administration services to State Street, both delivering cost efficiencies and an improved platform for customer engagement and future growth
• Zenith and Lonsec Recommended Ratings for all Multi Asset funds
• Zenith Recommended ratings for Green Bond & Sustainable Bond Funds
• Increase in brand awareness from 11% to 22%^[7]
• Multiple industry awards and accolades
• Top 3 NPS for super^[8] and number 1 NPS among advisers^[9]

Revenue

Total revenue increased 19% to $119.4 million. The increase was driven by average FUM growth of 31% partially offset by a reduction in average blended revenue margin which fell from 1.02% in FY24 to 0.92% in FY25 – this reduction was primarily driven by the acquisition of the lower margin Altius fixed income funds in late September 2024.

Expenses

As Australian Ethical continues to scale, operating leverage has seen further improvement. Underlying cost to income ratio (CTI) improved from 73.7% in FY24 to 71.4% in FY25. FY25 expenses (excluding non-underlying UPAT adjustments), increased by 14% compared to FY24.

Expense increases were primarily driven by:

• A 16% increase in employment expenses, driven by capability uplift including the onboarding of the six-person Altius team, as well as the run rate of FY24 hires and remuneration increases.
• A 20% increase in fund-related expenses, compared to average FUM growth of 31%. The increases relating to FUM and transaction volume growth was significantly offset by the new commercial rate cards following the superannuation administration and custody transitions, with custody and super administration fees decreasing 4%
• The overall increase in fund-related expenses was also driven by investment platform implementation costs and the acquisition of Altius
• A 10% increase in IT expenses following expenditure on a strengthened, more efficient and resilient technology infrastructure to support future business growth. Continued improvement in cloud and digital capability, and investment in cybersecurity defences contributed to the increase
• A 5% increase in marketing spend reflects our ongoing commitment to build our brand to support further growth

Expense increases were partially offset by:

• A reduction in external services expenses of 17%, as a result of lower recruitment and consulting costs

Final dividend

The Board declared a fully franked final dividend of 9 cents per share for the year ended 30 June 2025. The record date is 4 September 2025 with payment on 19 September 2025. This takes the full year dividend to 14 cents, up 56%.

Australian Ethical Foundation Limited

During the period, Australian Ethical allocated $2.8 million to the Australian Ethical Foundation for its future work supporting high impact, innovative charities in their work to combat climate change in three specific focus areas: place-based nature solutions; unlocking capital for nature; and climate justice and resilience.

Each year, 10 per cent of Australian Ethical profits^[10]are allocated to not-for-profit organisations through the Foundation.

Board Updates

Following more than a decade of service, Kate Greenhill has announced her retirement from the Boards of Australian Ethical Investment Limited, Australian Ethical Superannuation Pty Ltd and the Australian Ethical Foundation Limited.  Kate will retire by 31 October 2025.

Steve Gibbs, Chair of Australian Ethical said: “The Board is sincerely grateful for Kate’s contribution. She has brought substantial expertise to our governance and financial oversight given her extensive prior professional services experience and been an important part of overseeing a significant scaling of the Australian Ethical business over the last 12 years”.

Kate Greenhill said: “It has been a career highlight and privilege to help steer Australian Ethical for the last 12 years. The organisation has gone from strength to strength, becoming a proof point that enterprises with purpose can do good, do well, and achieve exponential scale along the way. Australian Ethical has become a beacon for responsible investment and offers a global use case for commercial success that is valuable for people and planet”.

Australian Ethical announced two new Board appointments to the Australian Ethical Investment Limited Board over the last year, with Richard Brandweiner and Brian Bissaker already making a valued contribution to the recent success of the Group.  These additions have been part of a well sequenced and disciplined Board renewal program.

The Board also advises that Steve Gibbs has stepped down as Chair of subsidiary company, Australian Ethical Superannuation Pty Ltd, effective close of business 25 August 2025, but remains as a non-executive director of that entity and remains as Chair of Australian Ethical Investment Limited.  Fiona Reynolds, who joined the board of Australian Ethical Superannuation Pty Ltd on 1 July 2024, has been appointed as Chair of Australian Ethical Superannuation Pty Ltd, effective close of business 25 August 2025.

“Fiona Reynolds brings deep experience and knowledge of both superannuation and responsible investing,” said Steve Gibbs. “She served as CEO of the UN Principles for Responsible Investment for nine years, based in London, and is the former CEO of the Australian Institute of Superannuation Trustees. Fiona also serves on the board of the Australian Sustainable Finance Institute and is the Chair of the United Nations Global Compact Australia Network. We are delighted she has accepted the role of Chair of Australian Ethical Superannuation.”

Outlook

Over FY26, Australian Ethical anticipates further profit uplift coupled with sensible reinvestment in the business designed to prepare for the next phase of growth.

Growth in organic FUM is expected to continue, underpinned by the compulsory Superannuation Guarantee contribution rate increase and the focus on retention and engagement of the member base, as well as continued focus on the values-aligned middle market channel for the non-super business.

Further, Australian Ethical sees potential for new revenue capture through the recent asset class expansion in private markets and fixed income, and future potential in international equities.  The investment talent, product expansion and systems that it continues to build sees it well placed to deliver, whilst further incremental fee reductions are expected to result in a modest decline in FY26 revenue margin.

FY26 will see the completion of a number of inflight initiatives, and will see further targeted capability uplift to underpin future growth. In FY26, the full run rate of the financial benefits of the FY25 operating platform enhancements are expected.

John McMurdo, Australian Ethical’s Managing Director, concluded: “I am proud of the growth we’ve achieved over the past five years and the work the team has done in the past year, guided by our Board, to set us up for our next phase of growth.

“We anticipate that the completion of our new superannuation and investment management operating platforms will unlock further growth across both business lines as we strengthen our member and investor experience and enhance our market position.

“We are confident that we can continue to grow both organically and periodically inorganically and also deliver further operating leverage improvements over time.

“Whilst we expect the market and economic volatility experienced in FY25 to continue, we are very well-positioned with our high-quality capability, long term investment performance, strong balance sheet, enhanced business platform, brand trust, channel breadth and our deep ethical pedigree. We believe that the medium-term market opportunity remains compelling for Australian Ethical.”

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Notes:
[1] Attributable to shareholders
[2] The annual return for the period to 30 June 2025 after fees. https://www.australianethical.com.au/super/performance-and-prices/ and https://www.australianethical.com.au/managed-funds/performance-and-prices/
[3] Underlying cost to income ratio is calculated as total expenses excluding UPAT adjusted expenses, excluding the profit/loss attributable to the Foundation and excluding tax, divided by total revenue excluding UPAT adjusted revenue
[4] Based on UPAT attributable to shareholders
[5] 10% of AEI profits before deducting bonus and grant expense is allocated to the Foundation
[6] Net of fees and distributions
[7] YouGov Brand Health Index, July 2025
[8] Investment Trends Member Engagement Report 2025
[9]  Against a benchmark peer set of active Australian small and mid-cap managers – CoreData Research: Bi-Annual Tracker Report; Q1 2025
[10] Before deducting bonus and grant expense

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Mr Gracey will transition portfolio responsibility to Head of Equities Nathan Parkin, who will assume full management of the Fund from the end of September, with Mr Gracey remaining in an advisory capacity until mid-December 2025.

Deputy CIO John Woods said, “Andy has made a valuable contribution to the firm over the past 20 years, and we’re thankful for his dedication and long-standing service. We’re grateful for his commitment to both the firm and our clients, and we wish him all the best in his next endeavour. We’re pleased to have a capable and experienced successor in Nathan, and we’re confident in the continued investment discipline and focus on values that have been hallmarks of our approach.”

Departing Portfolio Manager Andy Gracey said, “I’ve enjoyed the past 20 years at Australian Ethical immensely and am proud to have reached this milestone. I have complete confidence in Nathan’s leadership and was thrilled when he accepted the role. I’ll continue to support the business and the team through to my departure in December, and I look forward to working closely with everyone over the next five months.”

Head of Equities and incoming Portfolio Manager of the Fund Nathan Parkin said, “It’s an honour to carry on Andy’s exceptional management of the Fund.  We’re excited by the continuing opportunities for clients in small and micro-caps, utilising our excellent pedigree in researching this part of the market.”

Mr Parkin brings more than 30 years’ experience in Australian financial markets, including two decades in small and mid-cap management. Previously he managed up to $6.5bn in Australian equities portfolios as Deputy Head of Equities at Perpetual Investments and co-founded Ethical Partners Funds Management where he was the Investment Director.  

Since its inception 10 years ago, the Emerging Companies Fund has delivered 12.2% returns pa compared to its benchmark of 6.8% pa over the same period^[1].

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[1] Performance information is correct at 30 June 2025. Past performance is not a reliable indicator of future performance. The information provided does not constitute personal financial advice and has been prepared without considering your objectives, financial situation, or needs. Before making an investment decision, carefully review the FSG, PDS and TMD at australianethical.com.au to consider if the product is right for you.

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John Woods

Australian Ethical’s Balanced Fund, its MySuper option, delivered 10.5%¹ (after fees) in the year to June 30, 2025, demonstrating the strength of its ethical investment approach in the face of challenging market cycles.  

Australian Ethical’s Growth Fund delivered 11.5%¹, and its High Growth Fund delivered 12.8%¹. All Australian Ethical’s super options are certified Sustainable Plus by the Responsible Investment Association of Australasia^[2]. 

Australian Ethical Deputy CIO John Woods said, “Our performance is proof that ethical investment can generate strong returns while enabling our members to invest in line with their values. “It’s pleasing to see that our fund performance has been positively impacted by our limited exposure to fossil fuel companies. As pioneers of Australia’s ethical investing movement, we go further to ensure our members’ retirement savings are invested to deliver the future they want for themselves and their world.

“Our ethical approach enhances due diligence and risk management, adding additional protection to the portfolio through periods of market volatility. It also means we favour future-focused investments that in line with our Ethical Charter seek to do good by people, animals and planet, and importantly that will have a place in our world for many decades to come.” 

In addition to the performance benefit from the limited exposure to resources and fossil fuels, disciplined processes led the team to trim overvalued holdings and invest in higher-quality opportunities across sectors and asset classes. The team has also identified alternative defensive exposures, bolstered allocations to private markets, and actively managed fixed income amid public market volatility.  

Australian Ethical uses its position as an investor on behalf of its members to influence the companies it invests in, policy, and the economy, to encourage positive change.    

In the last financial year, its ethical stewardship program focused on engaging with companies like QBE Insurance and Westpac to encourage these financial institutions to switch off financing to new fossil fuel projects and encourage the companies towards a net-zero future.  

Over the long term, Australian Ethical’s Balanced Fund delivered a 6.8% p.a. return over 10 years to June 30, 2025^[1]. The Fund is weighted 62.5-82.5% growth assets and 17.5-37.5% defensive assets. It aims to achieve returns of 3.25% above inflation after investment fees and taxes over a 10-year period.  

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Notes:
[1] The annual return for the period to 30 June 2025 after fees. https://www.australianethical.com.au/super/performance-and-prices/ 
[2] https://www.responsibleinvestment.org/find-certified/products/

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