MARK MCVEIGH: I've always been interested in the natural world. My true passion is plants and ecology.

I love knowing about how interactions happen between different organisms and Australian wildlife especially is very beautiful for that.

TRACY BOWDEN, REPORTER: Ecologist Mark McVeigh is at the centre of a court case which could cause ripples around the world.

MARK MCVEIGH: It's extremely daunting. I was nowhere near expecting this when I sent an email back in 2017 but this is where it's ended up, and I think that's a good thing.

MARK BLAND, FORMER ASIC LAWYER: It's a very significant case because it's the first of its kind that's testing what a trustee has to do and what they have to tell their members about what they do in relation to the risks of climate change.

TRACY BOWDEN: The case focuses on whether a super fund failed to protect retirement savings from climate change risks.

When Mark was a student, he worked in a supermarket and joined the Retail Employees Superannuation Trust, known as REST.

MARK MCVEIGH: My superannuation is going to be sitting there investing over my lifetime, and I wanted to know what was going to happen with that money, and the impact climate change was going to have on it.

TRACY BOWDEN: He wrote: "I expect your response to provide portfolio-specific details of how climate change risks are being evaluated and factored into the fund's decision-making processes."

MARK MCVEIGH: I didn't find anything out basically, because REST didn't have that information available.

EXTRACT FROM PROMOTIONAL VIDEO: Now that you're with REST, we're going to make your money work hard for you. I know, awesome, right?

TRACY BOWDEN: While super funds are obliged to give information to members about investments on request, the extent of that information is not defined under the law.

REST manages about $60 billion for its 1.7 million members.

DAVID BARNDEN, LAWYER: First of all, it's about money. So, superannuation funds must provide for their members' retirement.

TRACY BOWDEN: Lawyer David Barnden took up the case. Environmental group Friends of the Earth raised funds to protect Mark from bankruptcy if he loses.

DAVID BARNDEN: Mark is suing his superannuation fund for not giving him enough information about how they deal with climate change and he's also suing them because he says they're not acting in his best financial interests when making investments.

TRACY BOWDEN: The case comes at a time when Australia's disastrous bushfire season has put the issue of climate change at the centre of national discussion.

ILONA MILLAR, BAKER MCKENZIE: When you look at the context of climate risk, it's not what is the risk that a company poses to the climate, it's what is the risk that climate change poses to a particular company?

TRACY BOWDEN: Some of Australia's key financial institutions have begun to pay greater attention to those risks.

ILONA MILLAR: We've had statements from ASIC, from APRA, and even the Reserve Bank of Australia have all indicated that they do see climate change as potentially a financial risk and something that companies and, in the case of superannuation funds, the trustees should be considering.

TRACY BOWDEN: Ilona Millar is global head of climate change for law firm, Baker McKenzie. She explains that investment risk factors can be physical or what are called "transition risks".

ILONA MILLAR: Physical risks are the impacts that climate change may have on assets. For example, a building that might be at risk because it's in a flood zone.

With transition risks, we're looking at impacts related to regulatory change, litigation risk, market forces.

MARTIN FAHY, ASSOC. OF SUPER FUNDS: Funds are adjusting their portfolio and asset allocation in light of the risks, in light of where the market value sits in those assets, and what the long-term trade-offs and returns are likely to be.

TRACY BOWDEN: Superannuation is a $2.9 trillion industry in Australia. Super funds own almost 40 per cent of the companies listed on the Australian share market.

MARTIN FAHY: The regulatory structure requires funds and trustees of funds to invest members' money for the sole purpose of delivering good returns with outcomes for members and they must do that in the members' interests.

But we need to be clear, it isn't a trade-off between good environmental outcomes and good member returns. We can actually have both.

TRACY BOWDEN: Martin Fahy from the Association of Super Funds of Australia says climate change has been on the industry's radar for more than a decade but that selling off assets should not be the first step.

MARTIN FAHY: The view from responsible investment professionals around the world is that divestment is not an effective way of addressing the carbon puzzle, and that it's much more effective if we can engage with asset owners and help them accelerate the transition to a low-carbon environment and greater energy security.

TRACY BOWDEN: According to REST's pre-trial documents lodged with the court, the fund will argue climate change is only one of many material factors that may be considered by Australian investors.

Other factors which may be considered include technological developments, trade agreements, Brexit, the El Nino cycle, and interest rate changes.

REST declined 7.30's request for an interview but in a statement said "Climate change risks are factored into REST's investment strategy and decision-making process, including asset allocation and strategy reviews".

Former ASIC lawyer, Mark Bland, says the decision in this case could have an impact on not just super trustees, but investment advisors around the world.

MARK BLAND: If Mr McVeigh's case is successful, then other superannuation trustees are going to have to quickly address their own situation to see if they're meeting the benchmark standard that's laid down by the court in relation to how they're managing climate change risk, and also how transparent they're being with their members.

TRACY BOWDEN: Mark McVeigh's case is due to be heard in the Federal Court in Sydney in July.

MARK MCVEIGH: I want REST to change their behaviour and to actually have a comprehensive investment strategy for climate change, and I hope that this also flows on to other superannuations in Australia and they make the same decision.