Ex-Railpen sustainability chief will oversee the Australian pension fund’s ESG integration and engagement activities as it expands its European operations.
Melbourne-headquartered superannuation fund AustralianSuper has hired Deborah Gilshan as Head of ESG and Stewardship (Europe), as the firm continues to diversify investments globally.
In the role, Gilshan will lead the pension fund’s ESG and stewardship programmes in public and private markets in Europe, including interaction with stakeholders, regulators and industry bodies.
“I have admired AustralianSuper for some time both for its well-regarded ESG and stewardship team and for the member-first ethos which sits at the heart of all decision-making,” Gilshan told ESG Investor.
She added that Australia’s superannuation sector has “emerged as a significant global investor base” and that joining the firm felt like a “unique and significant opportunity” given the international growth trajectory of the pension fund’s assets “at a time when engaged ownership continues to grow in importance”.
Gilshan has over 22 years’ experience in global investment stewardship, shareholder engagement and ESG integration. She previously spent more than two years at global investment firm and asset manager abrdn as its ESG Investment Director, as well as being Head of Sustainable Ownership at UK pension fund Railpen.
She also founded of The 100% Club, a network dedicated to the advancement of women, which was started in 2011.
Strengthening stewardship
The 2023 proxy season saw a greater volume of ESG-related shareholder proposals, with 950 filed and 335 votes requesting disclosure and action on ESG issues in the US alone.
However, overall support for such proposals this proxy season has declined significantly as they become more specific and focused on the impact of environmental and societal issues.
“Shareholder proposals are a key aspect of any stewardship programme,” Gilshan said, noting that as climate-related risks become more integrated into company strategies and investors evolve their engagement on such issues, support for shareholder proposals may become “more nuanced”.
AustralianSuper aims to maximise long-term value for its members through the assessment and integration of ESG risks and opportunities when selecting and managing investments. It also exercises its rights and responsibilities as a shareholder to influence and improve ESG practices of investee firms by advocating for better outcomes and participating in collaborative investor initiatives to influence the management of ESG issues.
Gilshan said the pension fund has identified strategic ESG themes. On environment, AustralianSuper is targeting climate change and the circular economy. For social, it is focused on workforce, diversity, and digitalisation, while for governance its core themes are board effectiveness and remuneration.
“We believe the effectiveness of a company’s board is one of the most important drivers of future value, so it’s important to engage with companies to guide the composition of boards,” she said.
“Research indicates that companies led by diverse boards are more likely to deliver better outcomes for members, which is why we’re taking positive action to improve gender balance on boards,” Gilshan added.
“To deliver long-term value for members, we seek that companies have remuneration frameworks that align the outcomes and behaviours with long-term performance.”
According to Gilshan, well-governed companies that manage their environmental and social impacts can deliver better long-term investment performance for its members.
AustralianSuper is also a founding member of Climate Action 100+. The investor engagement initiative has over 700 investor signatories globally, representing US$68 trillion in AuM, advocating for 171 of the world’s largest carbon emitters to transition to net zero.
Global expansion
Around half of AustralianSuper’s A$300 billion (US$195.9 billion) in member assets are currently invested outside of Australia, with more than A$40 billion in the UK and Europe. The fund is forecast to grow to more than A$500 billion over the next five years and will deploy almost 70% of its growing inflows into global markets.
Gilshan has joined AustralianSuper alongside several other senior UK appointments who will play a pivotal role in helping the fund develop and implement its international investment model grow its global investment footprint and enhance its offshore operational capability.
AustralianSuper Deputy Chief Investment Officer Damian Moloney said the high calibre appointments reflected the region’s long-term importance for the fund.
“Since opening our office in the UK seven years ago, we have sought the best talent to enable us to build our investment platform and improve our global presence, with the aim of driving sustainable long-term performance for more than 3.1 million members,” he said in a statement.
“With capabilities now in place across private, public and capital markets, the London office is now an important investment engine for the fund.”
