How sustainable is your KiwiSaver supplier?
Through bodies such as the RIAA, it’s easy for investors to be confident that their provider is putting their money in their mouths.
In a world where climate change is front and center and global tensions are rising, many New Zealanders are thinking about where their KiwiSaver funds are invested.
But it can be difficult to understand which statements about responsible or sustainable investing carry more weight than others.
Philip Houghton-Brown is Head of Investment Solutions for Westpac NZ’s investment arm, BTNZ. He believes independent certifications are a simple and easy way to verify the integrity of the fund you are investing in.
One of the most respected certifications comes from the Responsible Investment Association Australasia (RIAA).
“Around three-quarters of New Zealand investors expect their KiwiSaver and investment fund providers to invest responsibly or ethically, and 62% of New Zealanders say it is important that their investment makes a positive difference in the world. Through organizations such as the RIAA, it’s easy for investors to be confident that their provider is putting its money where it says it is,” says Houghton-Brown.
“The Westpac KiwiSaver program is one of the few KiwiSaver programs whose majority of its funds* have been certified by the RIAA, which guarantees that the certified funds are what they claim to be.”
The majority of Westpac Active Series and Westpac Premium Investment Funds are also certified by the RIAA**.
The RIAA’s Responsible Investment Certification Program is recognized by investors across New Zealand and Australia. It demonstrates that an organization’s products and services meet the responsible investment standard and deliver on their responsible investment promises.
BTNZ also does not invest in companies that derive income from tobacco, the manufacture of controversial weapons or companies with a significant activity in the production of fossil fuels, as well as in other industries defined in our criteria. exclusion of investments.
However, Houghton-Brown says sustainable investing at BTNZ is about more than excluding companies from portfolios. This means working to align assets under management to a 1.5 degree trajectory and net zero greenhouse gas emissions by 2050 or earlier.
“We are also working to invest more in companies and other issuers that implement or deliver climate or biodiversity solutions, or support water management and pollution prevention and control. This is an important part of our sustainable investing policy.”
RIAA certification also ensures that funders are actively involved in monitoring investments, such as tracking how the companies they have invested in are addressing climate change.
“We require our investment managers to make decisions taking into account environmental, social and governance factors,” says Houghton-Brown.
“This means assessing whether a business is a leader in a particular area, is committed to improving the way its business operates in the community, and whether it considers these factors itself.
“Our investment managers also engage directly with the companies they invest in on our behalf to understand their long-term business planning and challenge them to develop their sustainability and climate change commitments.
“We want our clients to know that their nest egg is helping to create better results while achieving more sustainable returns on investment.”
Investors wishing to check which products and services are certified by the RIAA can visit their research and comparison tool, Responsible Returns.
BT Funds Management (NZ) Limited (BTNZ) is the program provider and issuer, and Westpac New Zealand Limited is a distributor, of the Westpac managed investment programs mentioned above. A Product Disclosure Statement for each program is available at westpac.co.nz or free of charge from any Westpac NZ branch. This material is provided for informational purposes only and does not constitute a recommendation or opinion regarding any financial product.
The RIAA has certified the funds described above in accordance with the strict operational and disclosure practices required under the Responsible Investment Certification Program. See www.responsiblereturns.com.au for details. The Responsible Investment Certification Program does not constitute financial product advice. Neither the certification mark nor the RIAA recommends to anyone that any financial product is a suitable investment or that returns are guaranteed. Appropriate professional advice should be sought before making an investment decision. The RIAA does not hold a financial advice provider license.
* The Westpac KiwiSaver Scheme Cash Fund is not certified because the RIAA does not currently rate cash funds under the certification program, and the Westpac KiwiSaver Scheme CPP Fund No.5 is not RIAA certified because it is closed to new investments.
** The Premium Investment Funds Enhanced Cash Fund (as a cash fund) and the Westpac Active Series Income Strategies Trust (closed to new investments) are not RIAA certified.