A recent scandal involving Active Super has exposed serious flaws in how some retail super funds market themselves as “green” or “ethical.” With millions of Australians choosing their super fund based on climate and social responsibility claims, this case is a stark reminder: not everything marketed as sustainable is what it seems.
The Active Super Greenwashing Scandal
The Australian Securities and Investments Commission (ASIC) has launched legal action against Active Super (formerly Local Government Super), alleging that the fund misled members by falsely claiming to have excluded investments in fossil fuels, tobacco, and gambling.
Despite marketing itself as a responsible investor, Active Super was found to have invested in companies that directly contradicted these claims, including tobacco manufacturers, gambling businesses, and fossil fuel producers. ASIC’s case alleges that between February 2021 and June 2023, Active Super made representations that were false or misleading.
- Read ASIC’s official media release (Aug 2023)
- View Federal Court filings: ASIC v LGSS Pty Ltd (NSD944/2023)
This follows ASIC’s broader crackdown on greenwashing—a growing issue where funds use ESG (Environmental, Social, Governance) labels to attract investors while failing to meet the standards they claim to uphold.
Why It Matters for Everyday Australians
Many Australians choose ethical funds in good faith, trusting their retirement savings are being used to support positive causes. The Active Super case shows how that trust can be abused—and how members may unknowingly be supporting the very industries they’re trying to avoid.
Beyond the ethics, it’s also a question of performance and control. When large funds make misleading statements or act against members’ preferences, there’s very little recourse for individual investors—especially when decisions are outsourced to third-party managers.
The SMSF Alternative: Transparency, Control, and Values-Aligned Investing
At Freedom Financial Solutions (FFS), we help clients take direct control of their super through self-managed super funds (SMSFs). For investors with strong values—whether ethical, environmental, religious, or intergenerational—an SMSF can ensure that your investments actually reflect your beliefs.
With an SMSF, you can:
Choose exactly where your money goes without vague ESG spin
Avoid industries or sectors you don’t support
Invest in physical assets like bullion, property, or ethical businesses
Maintain full transparency and control over your investment strategy
And most importantly, you’re not relying on faceless fund managers or marketing departments to decide your financial future.
Final Word
The Active Super case isn’t just about one fund—it’s about the integrity of the entire system. If you’re concerned about where your money is going, now might be the time to ask a bigger question: do you trust someone else to care about your future as much as you do?
At FFS, we’ll help you explore smarter, safer, and more aligned alternatives to the retail super fund model.
Find out more. Email mary-jane@freedomffs.com.au
