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Our ethical criteria


A path to an ethical future

We only make investments that we believe are aligned with our ethical principles, laid out in the Ethical Charter, in 1986. In essence, these principles provide a tried and tested framework for examining whether a company is part of a path to a better future for people, animals and the environment.

See the ethical charter

How we assess

Within this framework, we assess whether a company is having a positive impact aligned with one or more of the 12 positive principles of the Charter, and also how it is managing harmful impacts under the 11 negative principles.

We look in detail at what the company produces and how the company operates, examining its products and services and how those products and services are produced, marketed, used and mis-used. We also consider the balance between the positive and negative effects of the company’s activities.

It's a balance

A company with positive products and services can remain an ethical investment even though it earns some revenue from a negative product or activity, or if its products and services are used by some in a harmful way. Also, where a company makes a mistake, we don’t automatically exclude it, but we assess whether the mistake indicates a systemic problem, and if the company has acted to fix the mistake and stop it happening again.

An example of this in practice is our retail framework.


Thresholds and criteria
for investment exclusion

We have over 200 revenue thresholds for positive and negative products, services and conduct by companies. The following table provides a sample of these, along with other criteria.

These are based on our exclusion policies, assessments and investments as at 30 June 2021.

The criteria and revenue thresholds change over time as the world and our understanding of it changes.

5 or 10%


Brewers, distillers and wine makers excluded.

0% for animal testing for cosmetic products.

Testing for healthcare must adhere to the 3Rs (replacement, reduction, refinement of animal testing)


We exclude companies relying on animals in their development of cosmetics and cosmetic products including teeth whitening products.

We invest in biotech and healthcare companies which rely on animal testing for development of new medicines and treatments, provided they are implementing the 3Rs.

5 or 10% for coal

10 or 33% for oil

10 or 33% for gas 


We exclude companies like Woodside, Whitehaven Coal, Santos, Origin and AGL because of their fossil fuel revenue.

Contact Energy has some revenue from gas but has passed our ethical screening. It generates 80% of its electricity from renewables, continues to invest in new geothermal, and relies on gas when low rainfall reduces its hydro-power.

Large banks must be aligning their corporate lending with the objectives of the Paris Climate Agreement.


We examine bank fossil fuel lending restrictions and their green lending targets. We currently allow investment in Westpac which has a strong Climate Action Plan. We exclude Export Finance Australia which finances fossil fuels and does not demonstrate a genuine commitment to align its lending with the Paris Climate Agreement.

We don’t currently invest in any airlines or conventional auto companies but we could invest if they were investing sufficiently in electric or other renewable energy sources to transition their business to net zero.


We invest in electric vehicle companies like Tesla as well as rail and bus companies like Stagecoach Group which have lower emissions and reduce congestion and other pollutants.

10% for conventional animal agriculture

15 or 33% for food processing revenue from conventional animal agriculture ingredients

33 or  50% for other types of non-sustainable food such as junk food unless positive or strongly positive impact from other activities

Food is assessed as sustainable if it is (1) part of a healthy diet; and (2) produced in a way which avoids unnecessary harm to people, animals and environment.


These thresholds apply to food producers and processors, not to retailers like supermarkets.

We assess processed food with low nutrient and high salt, trans-fat or sugar content as non-sustainable. We excluded Retail Food Group for its revenue from unhealthy food brands like donutking. We excluded Darling Ingredients for its animal food business lines and misleading information about the emissions footprint of animal protein consumption.

We have been strong advocates for an end to live export through our corporate engagement, government submissions and public voice.

5 or 10%


We exclude Tabcorp and Aristocrat. One of the reasons we excluded investment in shares of Woolworths was its poker machine revenue. We have invested in a green bond issued by Woolworths to increase the energy efficiency of its stores, and we are reviewing the company again after completion of its demerger.

0% for systemic disregard by board and senior leadership of worker entitlements and human rights impacts


We look at how companies monitor high risk operations and locations, and we have chosen not to invest in several clothing and electronics companies because of human rights concerns. We also use our investor voting power to signal concerns about low diversity and potential discrimination.

Sadly human rights breaches including modern slavery occur somewhere in the operations or supply chains of most large companies. We look for opportunities to engage and positively influence companies to change, rather than automatically rule them out for investment. Where a company makes a mistake, we consider if this indicates a systemic problem, and whether the company has acted to fix the mistake and stop it happening again.

0%, but we don’t exclude investment in nuclear medicine for diagnosis and therapy in healthcare.


One of the reasons we exclude BHP Billiton is its uranium mining.



In general large listed companies involved in pornography are media companies which earn revenue from distribution of “adult entertainment” below our exclusion threshold, typically less than one percent. Examples are AT&T Inc (who we invest in), and Amazon (who we exclude for other reasons).

0% for logging of old growth forest except for conservation, fire risk or other acceptable forest management purposes.


We excluded SCA (Svenska Cellulosa) for concerns about its old growth forest management.

We may invest in sustainable plantation timber production.

We do not automatically exclude a real estate investment or company that uses some non-certified timber, because we take into account the availability of certified timber and the positive and negative impacts of a company’s business.



As well as cigarette makers, we have excluded Amcor for its specialist cigarette packaging and Tomra for its specialist tobacco sorting equipment.

0% for whole weapons, 1 or 5% for components used to make weapons.

These thresholds apply to companies. When we are considering investment in government bonds, we assess the extent to which the country uses its military to aggressively promote its national interest; and the extent of military influence in the government of the country.


We exclude Lockheed Martin and Honeywell International.

Weapons excluded include both conventional and controversial military weapons, as well as non-military weapons.

The nitty gritty

Different thresholds are specified for some exclusions (e.g. 5 or 10%) where exclusion depends on the other activities of the company. For example, a company which earns revenue from production of alcohol will be excluded in the following cases:

  • The company does not generate any positive impact from its other activities;

  • Alcohol revenue is more than 5% of total revenue, and the company does not generate strong positive impact from its other activities; or

  • Alcohol revenue is over 10%, irrespective of the company’s other activities.

As an example, we may invest in a company which earns less than 10% of revenue from alcohol if it also has strong positive impact through its production of sustainable plant based food.

We may invest in specific securities issued by a company which support positive impact, even though we have excluded the company for other reasons. For example, ‘green bonds’ and ‘climate bonds’ are designed to fund positive environmental or climate projects focused on issues like energy efficiency, recycling and waste reduction. An example mentioned in the table is Woolworths: We don’t invest in Woolworths shares because of the gambling and alcohol revenue from their pubs, but we did invest in the Woolworths 2019 green bond to support their initiatives to reduce the carbon intensity of their supermarkets, including using solar panels, retrofitting LED lighting and reducing plastic wrapping on fruit and vegetables.

Where there is reason to divest from a company in which we are already invested, instead of divestment we may engage with the company to influence change to bring the company into alignment with our Ethical Charter. If this is not possible within a reasonable period we will proceed with divestment as we did with Marsh & McLennan.

For our ethical research, our team draws on third party information and analysis from company, industry, government, ESG research, academic and civil society sources. Often judgement and estimates are necessary to deal with information gaps, unreliability and complexity.


Learn more about our approach, engagement, advocacy and impact.

Sustainability reporting
Sustainability reporting

We take a deeper look at our advocacy initiatives, climate action, alignment to the UN SDGs, and community support.

Our positions
Our positions

Ethical investing is not always black and white. Our positions outline our stance on many challenging and complex issues.

Retail framework
Retail framework

To be investable, retailers must demonstrate genuine commitment and credible action to manage any negative impacts.