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Legislative Assembly for the ACT: 2012 Week 8 Hansard (22 August) . . Page.. 3226..

documented investment policies. A policy on responsible investment is simpler, it is cheaper, it is more efficient to administer than legislation and it will achieve the same objectives.

The proposed legislation is prescriptive and would involve setting up an extensive bureaucracy to administer investments. Further, determining ethics of a particular investment decision within legislation is difficult and would possibly make every investment decision subject to debate within the Assembly rather than the preserve of government and the Treasury.

The government has taken into account the views of the community and stakeholders through the recent inquiry into responsible investment and has listened to the position proposed by some in this place. The government has responded and indeed earlier today I tabled the government's responsible investment policy. This policy is a significant step forward. It is a policy based on a measured and sensible assessment of responsible investment issues in this inherently difficult area.

The government has already taken immediate steps towards the implementation of the policy, with relevant share investment managers instructed to divest any holdings that are now an excluded activity. The policy will continue to be implemented progressively during the financial year and the government will continue to monitor the policy and amend it where appropriate.

The principles for the responsible investment framework that are applied to the management of directly owned share investments will be enhanced by requiring the financial analysis and decision-making process to also take into account norms-based investment criteria; namely, the United Nations global compact.

I think it is worth advising the Assembly that in relation to proxy voting on direct-owned shares the government will develop its own policy and direct our external investment managers to vote in accordance with that policy and we do commit to increased annual reporting disclosure in relation to responsible investment activities.

I believe that this demonstrates our commitment to the policy, to relevant share investment management, and to ensure that the administrative and procurement actions required to fully implement the scope of the responsible investment policy will be undertaken over the course of the 2012-13 fiscal year.

So, in conclusion, the government will not be supporting this legislation today, but we believe the policy approach we have adopted is a sound balance and should be supported.

MR SMYTH (Brindabella) (5.11): The opposition will also not be supporting the bill. This is a reworked bill from Ms Hunter after the failed bill that the public accounts committee reported on, highlighting so many of the flaws that existed.

What the bill seeks to do is to divide investments into two groups of activities. The first group are activities in which investment will be prohibited; that is, tobacco, arms and armaments, cosmetics in which animal testing is used, and things breaching

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