30 September 2025
Australian Ethical is one of Australia's leading ethical fund managers. By investing responsibly in well-managed ethical companies, we deliver competitive financial performance to our clients and positive change to society and the environment. Since our inception in 1986, our Ethical Charter has guided all investment decisions and underpinned our business practices. Every year 10 per cent of our profits* are distributed to charitable organisations and social impact initiatives through The Australian Ethical Foundation.
To provide long-term growth focusing on Australian companies that meet our Ethical Criteria. The Fund aims to significantly exceed the return of the blended index after taking into account management costs over a 7 year period.
The opportunity to invest in a diversified share portfolio of companies predominately listed on the ASX and selected on the basis of their social, environmental and financial credentials. The Fund utilises an active stock-picking management style with stocks generally selected for growth rather than income, with a bias towards smaller capitalisation stocks listed on the ASX. All stocks are chosen on the basis of relative value where we deem the risks are being adequately priced.
| 1m | 3m | 6m | 1y | 3y | 5y | 10y | Since inception | |
|---|---|---|---|---|---|---|---|---|
| Fund | -1.6% | 4.2% | 11.7% | 5.9% | 12.6% | 9.2% | 9.5% | 9.7% |
| Composite Benchmark** | -0.7% | 5.0% | 14.9% | 10.8% | 15.0% | 12.9% | 9.9% | 7.7% |
| S&P/ASX Small Indust. | -0.7% | 11.2% | 20.6% | 12.9% | 14.7% | 7.1% | 7.9% | 7.0% |
| CY 2024 | CY 2023 | CY 2022 | CY 2021 | CY 2020 | |
|---|---|---|---|---|---|
| Fund | 17.2% | 10.3% | -17.6% | 14.2% | 19.9% |
| Composite Benchmark** | 11.4% | 12.1% | -1.8% | 17.5% | 1.7% |
| S&P/ASX Small Indust. | 12.1% | 11.4% | -21.8% | 13.7% | 5.9% |
Portfolio diversification: Diversify your portfolio by investing in companies and sectors not well covered by other fund managers and brokers.
Help build a better world: Invest in the new, low‐carbon economy, fund medical and technology breakthroughs, efficient transport and more.
Promote human rights: We strive to avoid any investment in companies involved in the poor treatment of asylum seekers or the exploitation of workers through poor working conditions.
The Australian Shares Fund (Retail) delivered a +4.2% return (net of fees) for the September quarter. The Materials sector detracted from performance, as the sector performed well and we are underweight the sector due to our Ethical screen. The Fund performed ahead of the S&P ASX Industrials benchmark (which excludes the Materials sector and more closely aligns with our investment universe) which was up 3.9%.
A feature of the September quarter was the investor interest return to resource and mining companies, with the Materials sector significantly outperforming the rest. The big miners benefited, while a strong rally in the gold price driving gold miners higher. Gold miners collectively account for ~15% of the Small Ordinaries and gold doesn’t meet criteria for investment under our Ethical Charter. This was a material headwind for the portfolio (260bps) given our natural underweight position to these companies.
There was also renewed interest in small cap companies in the quarter, with the cohort outperforming their large cap peers, as investors began to refocus on areas of the market where valuations remain attractive. Reflecting this, the Fund’s stock selection in small to mid-cap technology companies like Pexa, Siteminder, Nuix, Cuscal and ERoad contributed to strong performance over the quarter.