Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


When responsible investing gets ‘too hard'

8 August 2019

Fund managers shirk duty when responsible investing gets ‘too hard’

Kiwis are unwittingly backing shady companies because some New Zealand investment funds are outsourcing management responsibilities to overseas fund managers.

Joe Bishop, Kiwi Wealth’s General Manager Customer, Product and Innovation, said fund managers that relied on low-cost passive index funds such as Vanguard were leaving investors exposed to companies with highly questionable, and even unlawful, records on environment, human rights and governance issues.

“As BusinessDesk reported last week, KiwiSaver funds are being exposed to Barrick Gold via Vanguard’s ironically-named Ethically Conscious International Shares Index. Barrick is a company that for years has been implicated in the abuse, rape and murder of workers and locals at a mine they operate in Tanzania. Similar allegations have been made about their operations in Papua New Guinea.

“The only tool the Vanguard funds have available to them is to exclude entire sectors from investment portfolios. But what about individual companies that operate in sectors that aren’t excluded, but which have highly questionable, even unlawful, records?

“We dumped Barrick years ago, as did the New Zealand Super Fund. That Barrick is a dodgy operator comes as no surprise to us, nor should it to any other responsible New Zealand fund manager. In our view, those who continue to invest in Barrick are either lazy, don’t care or both.

“That’s the benefit of managing members’ investments from here in New Zealand, based on what Kiwis want, rather than outsourcing decision-making. We make the decisions on what we invest in and we can adjust our investments to suit the views of New Zealanders.

“The tools are there. All it takes is a bit of extra work to research and to implement – precisely the skills investors want from their fund manager.

“Our view is that responsible investing is sadly becoming a bit of a box-ticking exercise or a marketing play. Statements that profess responsible investment values may get a cheap headline, but the talk hasn’t necessarily been followed up with action – at the expense of doing good for both investors and the planet.

“For fund managers to absolve themselves of their responsible investing duties because it’s ‘too hard’ is, we think, frankly shameful. Kiwis deserve more.”


© Scoop Media

Business Headlines | Sci-Tech Headlines


NIWA: Scientists Say Methane Emitted By Humans ‘vastly Underestimated’

NIWA researchers have helped unlock information trapped in ancient air samples from Greenland and Antarctica that shows the amount of methane humans are emitting into the atmosphere from fossil fuels has been vastly underestimated... More>>


SMC Expert Reaction: Record Dry Spells And Effects On Forests

With no rain forecast before Sunday, Auckland is about to break a record for the city's longest dry spell. Niwa says Auckland is likely to hit 40 consecutive days without rain this weekend . The upper North Island is seeing severe meterological ... More>>


Reserve Bank: Official Cash Rate Remains At 1.0 Percent

The Monetary Policy Committee has decided to keep the Official Cash Rate (OCR) at 1.0 percent. Employment is at or slightly above its maximum sustainable level while consumer price inflation is close to the 2 percent mid-point of our target range. ... More>>


Science Media Centre: Novel Coronavirus Detected In China – Expert Reaction

The virus was detected after more than 40 people were hospitalised with pneumonia in Wuhan City, China and the outbreak traced to a large animal and seafood market. The Centers for Disease Control and Prevention reports that person-to-person transmission ... More>>


Science Media Centre: Flooding could release toxic gas – Expert Reaction

A chemical substance known as ouvea premix stored at an old paper mill in Mataura could release toxic ammonia gas if it comes in contact with water.More>>