Australian Ethical’s Superannuation Growth Offsets Wholesale Redemptions
Australian Ethical faced $100 million in redemptions from wholesale investors during the third quarter of 2026, according to the company’s latest update.
Despite this, the firm’s funds under management (FUM) remained stable, dipping slightly from $14.5 billion to $14.4 billion. The company attributed this to strong performance in its superannuation sector, which saw net flows of $130 million, pushing super FUM up to $10.5 billion.
The quarter’s investment performance was impacted by a challenging market environment, with inflation, higher interest rates, and geopolitical tensions affecting Australian equities. However, international equities showed stronger results.
Australian Ethical also launched a new fund, the Australian Ethical Balanced Income fund, aimed at expanding its presence in the middle market. This initiative was supported by the Reichstein Foundation, a philanthropy organization focused on social, economic, and environmental justice.
Managing director John McMurdo expressed confidence in the company’s long-term growth prospects, highlighting increased superannuation net flows and the successful launch of the new fund. He acknowledged the impact of market challenges and wholesale redemptions on FUM but emphasized the company’s focus on attracting and retaining super members and expanding its middle-market reach.
In other news, the company announced that its chair, Steve Gibbs, will step down next year after 14 years in the role, as part of the firm’s board renewal process. Gibbs will depart no later than June 30, 2027, to facilitate a smooth transition to his successor.
The company’s ability to maintain its FUM despite wholesale redemptions can be attributed to its diverse revenue streams and strong performance in the superannuation sector. Superannuation, a mandatory retirement savings system in Australia, has been a key driver of growth for Australian Ethical, with the company’s focus on ethical and sustainable investments resonating with a growing number of Australians.
As the company handles a challenging market environment, its commitment to long-term growth and sustainability remains a key focus. With a strong foundation in place, Australian Ethical is well-positioned to continue attracting and retaining customers, while delivering value to shareholders.
