Investors prepared to switch for ethical funds, report shows

More than 80% of New Zealanders expect their KiwiSaver and other investments to be invested responsibly and ethically, new research by the Responsible Investment Association of Australasia and Mindful Money has shown.

Wednesday, October 30th 2019, 12:01AM

That is up from 72% last year.

Two-thirds said they would consider switching KiwiSaver provider if their current fund manager engaged in activities that were inconsistent with their values.

Of New Zealanders with KiwiSaver and other financial investments 60% said it was important that financial advisers were knowledgeable about responsible investment options at the same time as prioritising returns on investments.

"The rising consumer sentiment around ethical investing is reflected by the continuing growth in the responsible investment sector in NZ,” said RIAA’s chief executive Simon O’Connor.

“The challenge lies with fund managers to develop and provide consumers with suitable products which match their interests, concerns and values.”

Mindful Money’s founder and chief executive Barry Coates said: “The survey shows that New Zealanders want to avoid investing in companies that do not reflect their values – human rights violations and labour-rights abuses top the list."

Mindful Money's website allows investors to check where their money is invested.

“The survey confirms last year’s findings that it is not only millennials who want to invest ethically – support is even higher among those over 60 years old. Support is also stronger among women than men, especially in holding strong expectations of ethical performance in their KiwiSaver accounts and other investment funds.”

The survey showed 70% of consumers would be more likely to invest in a product certified by a third party.

The survey showed the vast majority of New Zealanders wanted their savings invested in companies that not only avoided damaging investments, but delivered positive outcomes, notably renewable energy and sustainable water solutions.

Just over half would consider investing in responsible KiwiSaver funds, investments or companies that were aiming to have a positive social or environmental impact within the next 12 months.

Eighty per cent of New Zealanders wanted to avoid investing in problematic companies or sectors, 89% of the public wanted to avoid investing in companies that did not pay their fair share of tax, 86% wanted to avoid social media companies that breached privacy standards, and 86% wanted to avoid companies that practised predatory lending.

Tags: KiwiSaver Mindful Money responsible investing RIAA