Judge deems Mercer's greenwashing contraventions as 'serious'
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What they said: When handing down his decision Federal Court of Australia Judge Christopher Horan said "the contraventions admitted by Mercer are serious".
"They arose from failures by Mercer to implement adequate systems to ensure that ESG claims in relation to its superannuation products were accurate, and to monitor and enforce the application of any sustainability exclusions associated with such ESG claims."
Horan added that "…it is vital that consumers in the financial services industry can have confidence in ESG claims made by providers of financial products and services. As is the case in many other industries, consumers may place great importance on ESG considerations when making investment decisions".
"Any misrepresentations in relation to ESG policies or practices associated with financial products or services, whether as an aspect of 'greenwashing' practices or otherwise, undermines that confidence to the detriment of consumers and the industry generally."
Mercer Superannuation to pay $11.3m in ASIC greenwashing case
The news: Mercer Superannuation will pay a penalty of $11.3 million for its greenwashing conduct, after an agreed on settlement with the corporate regulator was backed by the Federal Court of Australia today.
The context: The Australian Securities and Investment Commission's (ASIC's) case against Mercer was announced in February 2023 and was the regulator's first greenwashing lawsuit.
ASIC alleged Mercer made misleading statements about the sustainable nature and characteristics of some of its superannuation investment options. The statements on Mercer's website were linked to seven "Sustainable Plus" investment options offered by the Mercer Super Trust.
ASIC alleged members who took up the Sustainable Plus options had investments in companies involved in industries the website statements said were excluded. This included 15 companies involved in the extraction or sale of carbon intensive fossil fuels, 15 companies linked to alcohol production and 19 companies involved in gambling.
The fossil fuel companies included AGL Energy, BHP Group, Glencore and Whitehaven Coal. The alcohol producers included Budweiser Brewing Company APAC, Carlsberg, Heineken and Treasury Wine Estates. The gambling companies included Aristocrat Leisure, Caesar's Entertainment, Crown Resorts and Tabcorp.
The sources: Federal Court of Australia, ASIC
