This prestigious award recognises the super fund most committed to addressing its environmental and ethical responsibilities and confirms LGS as Australia’s leading responsible and sustainable super fund.

Commenting on the award, Chief Executive Officer, Phil Stockwell said, “At LGS, responsible investment is not an investment option, it’s integrated into everything we do. This ensures that our members can sleep well at night, knowing their super fund is managing their retirement income in a sustainable and ethical manner without sacrificing long-term returns.”

The aim of LGS’ responsible investment approach is to earn long-term sustainable returns by seeking out investments that have a positive impact on the environment and local communities while minimising the long-term environmental, social and governance (ESG) risks.

Head of Responsible Investment at LGS, Moya Yip, said, “Our approach is to employ a range of strategies to manage ESG risks including positive and negative screens, and as an active owner, we engage directly with companies in our portfolio and with industry organisations to continually improve sustainability performance.”

LGS manages one of the most sustainable direct property portfolios in Australia, having achieved Carbon Neutral certification for all NABERS rated buildings in the portfolio. Over 50% of the property portfolio utilises renewable energy generated onsite from solar panels while all electricity procured by LGS is offset with 100% GreenPower. This ensures the buildings only use independently accredited renewable energy from 100% renewable sources.

LGS has also been certified carbon neutral through Climate Active. The certification includes all LGS employees, the Sydney head office, and the fund’s seven regional offices.

LGS supports a number of carbon offset projects, including a re-forestation project in New South Wales, the Rimba Raya biodiversity reserve project in Indonesia, and a wind power project in Rajasthan, India. These projects reflect our local and global outlook and they generate environmental, social and economic co-benefits.

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LGS has met all the requirements of the Climate Active Carbon Neutral Standard (formerly the National Carbon Offset Standard). The fund closely measures emissions, reducing them where possible, offsetting emissions and publicly reporting on the results. The certification includes all LGS employees, the Sydney head office, and the fund’s seven regional offices.

Chief Executive Officer, Phil Stockwell, said, “Sustainability has always been a core value for LGS and becoming carbon neutral underlines our long-standing commitment to reducing emissions and contributing to a low-carbon economy.

It demonstrates to our members and the wider community that it is possible to effectively reduce emissions through targeted action.” Head of Responsible Investment, Moya Yip, said “LGS supports a number of carbon offset projects, including a re-forestation project in New South Wales, the Rimba Raya biodiversity reserve project in Indonesia, and a wind power project in Rajasthan, India. These projects reflect our local and global outlook and they generate environmental, social and economic co-benefits.

“The carbon offset projects align with the United Nations Sustainable Development Goals and the values of our membership base. The projects deliver community benefits in the form of employment opportunities for the local population, especially for women in enterprise. They also raise living standards through clean water and solar energy as well as introducing innovations into local agriculture.”

LGS’ head office is situated at 28 Margaret Street Sydney and is part of LGS’ property portfolio which was the first to be certified carbon neutral by Climate Active for all the NABERS-rated buildings in the portfolio. M

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Mr Stockwell takes up the role from the 26th of November 2019. His appointment follows an extensive executive search.

Commenting on the appointment LGS Chair Kyle Loades said, “Phil’s strategy, leadership and operational experience in financial services organisations in times of change is a good fit for LGS and our members. The LGS Board, in making this pivotal appointment, was focussed on securing a candidate who could lead the fund in key areas. These include maintaining the track record of long-term strong member retirement outcomes and investment returns, remaining at the forefront of sustainable investing, and leading positive change to evolve member service and value.”

“Phil has extensive investment industry experience and a career-long track record of creating and leading effective change programs to deliver better client service and investment outcomes. As such he will work with the Board and LGS leadership to articulate the Fund’s strategy, then lead the business to deliver on our aspirations for members. We are delighted to appoint a CEO of Phil’s calibre and background. He joins an experienced and tenured leadership team and takes over the role from Interim CEO Donna Heffernan.

“I would like to acknowledge Donna Heffernan for her contribution as Interim CEO this year. Donna will revert to her role as Deputy CEO and Company Secretary,” concluded Mr Loades.

Commenting on his appointment, Phil Stockwell said, “I’m delighted to join LGS as CEO. The Fund has a strong platform for growth and evolution, a trusted brand, and history of providing members with strong, consistent and sustainable investment outcomes. This focus on member outcomes and leadership in sustainability are important to me. In a time of great change for all superannuation funds there is increasing focus on improving member investment outcomes, value and service.”

“I look forward to working with the Board, Executive team and all stakeholders to ensure the Fund is well positioned to maximise the value we deliver for members.

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Craig Turnbull

Local Government Super (LGS) has announced that it has been identified by the world’s leading independent proponent of responsible investment, the United Nations Principles for Responsible Investment (UNPRI), as being in the top 10% of responsible asset owners worldwide. As a result, LGS has been included in the UNPRI Leaders’ Group which was recently announced at the UNPRI conference in Paris.

The UNPRI is an international network that works to better understand the investment implications of environmental, social and governance (ESG) factors, and to support asset owners to incorporate these factors into their investment and ownership decisions. The UNPRI founded the Leaders’ Group to showcase ESG leadership, and to increase the accountability in respect to responsible investment standards.

LGS’ Chief Investment Officer, Craig Turnbull, said: “We’re proud to have been included in the UNPRI Leaders’ Group. The main aim of the UNPRI is to encourage investors to use responsible investment not only to better manage risk, but to improve returns, and this aligns with LGS’ core objective of enhancing the retirement income of our members through the responsible, long-term stewardship of their funds.”

Selection into the UNPRI Leaders’ Group is based on an assessment of governance, responsible investment implementation and transparency. Asset owners with high scores are then screened against a specific theme. In 2019, asset owners were screened against the selection, appointment and monitoring of external managers of shares and private equity.

LGS’ Acting Chief Executive Officer, Donna Heffernan, said: “This is a great achievement for LGS. We’ve long been an industry leader in Australia, so it’s very pleasing to be included in the Leaders’ Group. It’s a global endorsement of our achievements in responsible investment.

LGS is also a proud signatory to the Australian Asset Owner Stewardship Code. LGS has a well-established active ownership policy, and strongly believes that positive social and environmental outcomes can be achieved by taking a responsible, long-term approach to the management of its members’ retirement savings.

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LGS Chair, Bruce Miller, said “We are proud of the team at LGS for this significant achievement. To be the only super fund that has won the Infinity Award six times since SuperRatings introduced the award in 2008 is a testament to our ongoing commitment and continued success”.

LGS Chief Executive Officer, David Smith, said: “We are delighted to be recipients of the Infinity Award once again. This Award reflects our commitment to achieving long-term sustainable returns for our members while also actively managing the environmental, social and governance risks across our investment portfolio.

“As one of the country’s leading sustainable super funds, we invest in long-term growth sectors that will have a positive impact on the wider community, such as renewable energy generation, clean technology, recycling and sustainable agriculture.

“Looking at 2016-2017 financial year, we reached A$954 million in low-carbon investments, up from A$790 million in just six months. This is just one example of how we’re continually looking to enhance our responsible and sustainable investment approach to managing our portfolio.”

“We are highly active in member engagement and education about responsible investment.  LGS has a fiduciary responsibility to operate in a sustainable manner that is in the best interest of our members,” Mr Smith said.

The Infinity Award recognises the super fund that best demonstrates its commitment to environmental and ethical responsibilities. Criteria for the award includes sustainability, risk management policies, initiatives and performance, through to member engagement, and operations, engagement with service providers, asset allocation and a general fund overview.

This latest award follows LGS’ number one ranking globally and in Australia for the management of climate change in the Asset Owner’s Disclosure Project (AODP) earlier this year.

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David joins LGS from AXIS Specialty Australia, where he served as CEO from 2011 to early 2016. Prior to this, he was CEO of Zurich Financial Services, and has over 17 years experience as a CEO and COO within the financial services sector.

LGS Board Chair, Ms O’Regan said the appointment followed a rigorous search process.

“We are delighted to announce the appointment of David Smith as CEO at LGS. The Board have chosen David for his track record in financial services, fit with the Fund’s values and ability to deliver on the strategy. I am confident he shares our passion for the best possible retirement outcomes for members, and that this will remain at the heart of all decisions. David’s C-suite experience brings additional capability to LGS and its members as we enter the next stage of growth,” said Ms O’Regan.

David said “As a global leader in responsible and sustainable investment, LGS has established a strong reputation for providing some 90,000 members with outstanding value via a combination of local, tailored service together with comprehensive investment options and competitive fees.

“I am committed to leading LGS to further develop and evolve this investment approach, which in turn, will play a key part in the ongoing success of the Fund. I look forward to working with the LGS leadership team and the Board,” he said.

In conclusion, Ms O’Regan said, “David’s appointment furthers the Fund’s commitment to member outcomes and service, responsible and sustainable investment approach, and to using sustainability considerations in investment decisions.”

David is a Fellow at the Australian Institute of Management, holds a MBA from the Massachusetts Institute of Technology and is a Graduate Member of the Australian Institute of Company Directors (GAICD). He has extensive Board experience, currently serving as the Executive Director of Equip Corporate Advisory and Chairman of the Children’s Cancer Institute.

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The 20-year anniversary comes shortly after LGS’ recent announcement that it has reached $10 billion in funds under management (FUM), up from $5 billion in just over seven years.

LGS Acting Chief Executive Officer, Donna Heffernan, said; “we are immensely proud of our first 20 years and there have been many highlights, including numerous industry awards, but the key to our success has been the focus on the needs of our members; the people who do such a great job serving our local communities.

“LGS was originally established as an industry fund to manage super for local government. Fast forward 20 years, and today LGS is a market leader in responsible and sustainable investment. We deliver tailored solutions and outstanding value to our members, and now anyone in the community can join and benefit from being a member of LGS.

“Our unwavering commitment to long-term growth sectors such as renewable energy generation, recycling and sustainable agriculture, together with competitive fees and a strong focus on local, personal service, has proved increasingly popular as Australians become more discerning when choosing a super fund to manage their retirement savings.”

LGS has been widely recognised for its leadership in responsible and sustainable investment practices and performance by a number of independent sources. Already this year, LGS has been awarded the top ranking in Australia and globally by the Asset Owners Disclosure Project (AODP), which annually ranks 500 of the world’s biggest investors based on how they manage the risks and opportunities associated with climate change.

Other recent accolades include:

• Best Green Super Fund 2017 (Money magazine Best of the Best Awards)
• Best Public Sector Fund 2016 (Super Review’s Super Fund of the Year Awards)
• Canstar Five-star rating 2017 for LGS Account-Based Pension Plan

LGS was also one of the first to be certified by the RIAA (Responsible Investment Association Australasia) as a responsible super fund.

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Chris Briant

Queensland local government superannuation fund, LGIAsuper, has appointed the US investment manager Parametric to implement a Tax-Managed Centralised Portfolio Management (CPM) solution for its Australian and international equity portfolios.

The CPM solution, involving assets totaling around $3.5 billion, is expected to be implemented by the end of April of this year.

LGIAsuper, which currently invests more than $9.5 billion in assets for around 90,000 members, uses seven Australian and nine international equity managers. Many of these managers will transition over to join the CPM portfolio structure.

LGIAsuper’s Investment Manager, Guy Rundle, says, “The decision to implement the Parametric CPM solution is based on its potential to improve after-tax returns for our members and to improve portfolio transparency in terms of transaction costs.

We are acutely aware that every dollar counts when it comes to growing members’ retirement savings. This is another way in which LGIAsuper is working to optimise the investment returns our members enjoy.”

As a holistic after-tax investing and reporting solution, the move to CPM also assists LGIAsuper in meeting its legislative obligation to focus on after-tax, rather than pre-tax, investment returns.

Chris Briant, CEO of Parametric Australasia, says, “We have seen the demand for our active and passive after-tax solutions building over the past few years. It takes time to work through understanding tax-managed CPM as a different type of investment structure, but as LGIAsuper worked through the process, the benefits became obvious.

Parametric research published last year (“The Road to Reward”) estimates that in general, a TM CPM approach can add between 50 and 90 basis points a year (pre-fees) to a super fund’s listed equities portfolio and analysis of LGIAsuper’s portfolio suggests that potential benefits within that range exist.”

LGIAsuper is Parametric’s sixth Australian client and its second large superannuation fund to implement CPM. The first was the $7 billion Qantas Superannuation Plan that adopted the CPM structure in 2012 for its equity portfolios and has since become an advocate of the centralised approach.

The Seattle-based Parametric is a leading U.S. asset manager specialising in investment solutions that promote implementation efficiency and a focus on after-tax returns, with $US152.7 billion in assets under management worldwide, including $US52.4 billion in tax-managed investment strategies.

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Peter Lambert

For the third year running, Local Government Super’s Accumulation Scheme has been awarded a five-star rating for outstanding value from CANSTAR. This is the highest rating granted by the independent, specialist researcher.

Local Government Super was one of just five funds to be awarded the five-star rating for outstanding value across all member profiles, including the new Wealth Accumulator profile. Overall Local Government Super was one of only ten super funds in total to receive the fivestar rating.

Chief Executive Officer, Peter Lambert, said: “We are pleased to again be recognised for consistently delivering truly outstanding value to our members.

“Our mission has always been to provide great service and achieve strong sustainable investment returns for our members and this rating is further endorsement that we’re on the right track with our products and services.

“Members of Local Government Super can be confident that we’ll be working just as hard over the next twelve months to maintain our five-star rating.”

The LGS Accumulation Scheme was particularly recognised for:

• a wide range of investment choice
• access to good quality scaled and comprehensive financial advice
• available death, and total and permanent disablement insurance cover.

CANSTAR evaluated the accumulation stage of 61 super funds available for personal super investment, taking into account the annual cost of the fund and fund features such as ease of member account access, number of investment options offered, and access to voluntary insurance, financial advice and strategy services within the fund.

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Leading Queensland local government fund LGsuper has selected Decimal to help drive a technology-based solution in support of fund members requiring single-issue financial advice.
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With the merger of LGsuper and City Super due to officially begin on 1 July, 2011, the fund is targeting an increased need for limited advice services to members. LGsuper currently manages around $4.4 billion in funds on behalf of 75,000 members. City Super has approximately 13,000 members and $1.5 billion in FUM.

David Todd, LGsuper CEO said: “In choosing Decimal we have a technology partner that will deliver end-to-end functionality and help our fund address a number of specific business and technical requirements. These include the ability to scale-up in future. We also anticipate deeper engagement by our fund members via the phone and face to face advice which will of course be underpinned by the Decimal technology.”
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Plans are in play for LGsuper to also adopt Decimal’s innovative SmartCalculator in the near future. The integrated online calculator represents a best of breed compliance, engagement and financial forecasting tool, with focus on the member and adviser at all times.
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Decimal Managing Director Jan Kolbusz said he was pleased to have been chosen by LGsuper to help empower its members with an elegant, simple advice solution. “We appreciate the high standards set by LGsuper and its board for service and technology requirements,” Mr Kolbusz said.
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The appointment of Decimal by LGsuper follows a number of similar organsiations signing on with Decimal. Recent partnerships include superannuation fund administrator Pillar Administration, and leading corporate fund AvSuper, based in Canberra.
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Meanwhile, representatives of the major Melbourne-based industry funds will be hosted by Decimal and leading consulting firm KPMG next week, June 15, for a breakfast presentation called “FOFA so good?: The role of technology in navigating change”.
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Matt O’Keefe, KPMG IT Advisory Partner, will discuss the role of technology for super funds riding the wave of regulatory and consumer behavioural change. Technology will play a crucial role in all aspects of member support including member retention, communication, engagement, literacy and advice.

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