Ethical Investment (Crown Financial Institutions) Bill

Dr Robert Howell, CEO, Council for Socially Responsible Investment, said that the failure of the Government to support the Ethical Investment (Crown Financial Institutions) Bill was unfortunate and short sighted. The Government missed an opportunity to remove the contradictions of the current legislation, and the chance to strengthen the risk analysis for future investment.

The current criteria for the Crown Financial Institutions is contradictory. In New Zealand we recognise that there are social and environmental boundaries that the market cannot determine, and which are provided by legislation. Investment, for example, cannot be used to severely damage the environment, or for companies that use child labour. As New Zealanders we accept this here, but the criteria for the CFIs does not restrict that type of investment overseas. It is not OK to pollute here in New Zealand, but it is OK overseas. The Bill would have removed that contradiction.

By establishing proper social and environmental criteria, the CFIs would carry out a much more rigorous risk analysis necessary for identifying the global drivers that will determine successful future investment. Social and environmental factors will continue to increasingly influence economic activity, and the bottom line of companies. The Government has unfortunately missed the opportunity to require a more robust business approach for the Crown Financial Institutions.

ENDS

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