Deanne Stewart

First State Super is one of 30 global businesses to have joined a United Nations-backed Alliance, who will work together over the next two years to support the delivery of the 2030 Agenda for Sustainable Development.

Speaking from New York at the launch of the Global Investors for Sustainable Development (GISD) Alliance, First State Super CEO Deanne Stewart said achieving the Agenda for Sustainable Development would require a bold and committed response from the public and private sector.

The 2030 Agenda, adopted by all UN Member States including Australia, is made up of 17 Sustainable Development Goals (SDGs) which set out a future underpinned by sustainable and inclusive economic growth.

First State Super is the only Australian organisation on the GISD Alliance, and Ms Stewart said it was critical organisations like hers were planning for a sustainable future.
‘As a long-term retirement provider, First State Super has a duty to manage the risks and opportunities associated with our investments and our members’ retirement savings in the long term,’ Ms Stewart said. ‘We have to protect and enhance the retirement savings of members who are at the end of their career, and also those who are just entering the workforce and may live beyond the turn of the century. In both cases, our members want their savings to support a long and happy retirement.

‘Considering and supporting long-term sustainability and value creation is critical to our ability to deliver on our purpose and support our members, no matter where they are on their life journey.

‘We know that future economic growth and prosperity will be delivered by those organisations who use their resources sustainably; treat their employees, customers and suppliers fairly and ethically; and have strong governance and culture; consistent with the SDGs.

‘Taking bold and decisive action now to deliver on the SDGs is critical to achieving long-term sustainable economic growth.’

The GISD Alliance has a two-year mandate to work together to consider ways to free up private capital to support the delivery of the SDGs.

Ms Stewart said First State Super had identified a number of focus areas aligned with the SDGs and made capital commitments in support of these. Its involvement in the GISD Alliance was a further opportunity to collaborate with other organisations globally to achieve real change.

‘The private sector has a pivotal role to play in achieving a sustainable future, in addition to considerable financing expected to come from public sources,’ Ms Stewart said. ‘The short two-year mandate for the GISD Alliance requires us to focus on clear targets and actions which will influence real change and deliver a genuinely sustainable future.

‘This is consistent with our purpose of delivering the best possible retirement outcomes for our members and being a force for good in the communities where they live, work and retire.

‘We have made a great start, and I look forward to seeing where our efforts take us over the next two years.’

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Damian Graham

The ability to influence the long-term sustainability of food supply chains and support the health of the planet, has driven First State Super’s interest the food and agricultural sector, according to Chief Investment Officer Damian Graham.

Speaking this week in Sydney, Mr Graham said issues relating to production, utilisation and wastage would become increasingly critical as global food demand was predicted to grow by more than 10 per cent each decade over the next 30 years.

First State Super has approximately A$1 billion invested in the agriculture sector. Some of the more recent investments include the sale and leaseback of land for almond production along the Murray River and the ownership of facilities to support poultry production on a rent by area basis.

To date, much of the focus on food investments has been based on the growth of the Asian middle class and subsequent increased demand, but Mr Graham said this needed to be complemented by the long-term supply-side considerations such as environmental impact and sustainability.

“When we’re thinking about our job as a responsible investor, we’re really thinking about having a positive impact on society and the communities in which our members retire,” Mr Graham said.

Mr Graham outlined four key issues impacting the future of food:

• Food utilisation: if we waste less we can produce less – this would have significant global benefits from an environmental and resource perspective.
• Food production: using technology to improve productivity and make processes more efficient, environmentally friendly and faster. For example, the potential for technology to be used to optimise seed, water and fertiliser usage.
• Food substitution: developing more sustainably grown substitutes such as plant protein-based meat substitutes right through to the ‘clean meats’ grown in labs.
• Food distribution and storage: the food supply chain currently uses significant refrigerants, a cause of climate emissions. Also, there are significant inefficiencies in logistics across countries which drive significant wastage.

“Addressing these issues are important for investment decisions and for the future of food supplies across the globe,” Mr Graham said. “Innovations such as ‘clean meats’, ‘just in time’ food delivery and ‘super glass houses’ will be important developments driven by investment in technology.”

“Through our investments in food and agriculture, we are seeking to continue to optimise the efficiency of production around energy, water and other inputs to help meet increased global demand in a more sustainable way; while continuing to meet our obligation to provide our members with the best possible investment returns.”

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John Livanas

In a landmark event, First State Super has successfully reached a binding settlement with State Super to acquire StatePlus. When the transaction completes in June 2016, First State Super will create the largest member-owned financial planning network in Australia.

First State Super CEO Michael Dwyer AM explains: ‘We’re investing to provide our members with an even stronger financial future. As a result of the acquisition we plan to bring together First State Super Financial Services and StatePlus. Together we will create a financial advice service that builds on the strengths of both organisations. We will leverage our increased scale to maximise retirement income for our members.’

StatePlus, formerly State Super Financial Services, was established in 1990 by the SAS Trustee Corporation (STC) to provide financial advice to public sector employees and their families.

STC Chief Executive John Livanas commented: ‘StatePlus is an excellent organisation that has achieved strong growth under STC’s ownership. It has provided our retiring members with tremendous support and guidance. The STC board believes StatePlus is well placed to build on its successes under the new ownership of First State Super. STC looks forward to a strong, ongoing relationship with StatePlus as it continues to provide financial advice to STC scheme members under its new owners.’

Michael Monaghan Managing Director of StatePlus, said: ‘StatePlus has client-centric values, and industry-leading client satisfaction. There is a clear alignment of values between our two organisations, and growth opportunities. StatePlus is well positioned for growth having successfully executed on a strategy to transform the business and become digitally enabled while continuing to deliver exceptional service. As we undergo this ownership transition we remain focused on the clients who rely on us, delivering high quality advice and service, as usual.’

The combination of First State Super Financial Services and StatePlus will create one of the country’s leading financial advice businesses with over $21 billion in retirement funds and over 200 financial planners located in metropolitan and regional centres throughout Australia.

Michael Dwyer continued: ‘First State Super and StatePlus are highly compatible organisations. We share a common set of values that stem from our shared heritage of delivering retirement solutions to public sector employees. The values of both our organisations place our members and clients at the heart of everything we do.’

‘For now it is business as usual for both operations. First State Super Financial Services and StatePlus will continue to operate as separate and distinct businesses while we develop our plans for the future. We want to fully understand the unique opportunities that this acquisition presents for both organisations and the members and clients we serve.’

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