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From Niche to Norm: $100 Billion of KiwiSaver Funds Use an Ethical Approach
1st Oct. 2024
New analysis shows good news about Kiwis investing ethically. There is rising demand for ethical investment, more Kiwis are aware of the companies in their KiwiSaver fund, and there is a sharp decline in unethical investment. Ethical investment has progressed from a niche to become the dominant approach to managing investments.
In boardrooms and living rooms alike a powerful message is resonating: our investments have the potential to shape the world. Together, we're leading a charge towards investments that don't harm people, the planet or animals.
We've been tracking KiwiSaver and managed funds investments over the past six years. The data reveals an encouraging trend: unethical investments are on the decline as Kiwis care more than ever about their investments not causing harm.
Notable Reductions in Unethical Investments:
- 74% fall in tobacco products
- 69% decrease in pornography and adult entertainment
- 33% reduction in alcohol-related investments
- 31% decline in weapons funding
- 29% drop in investments linked to animal cruelty
- 20% decrease in gambling-related investments
- 16% fall in investments causing environmental damage
It's proof that when we come together, we can make a difference.
Over 400,000 New Zealanders have now taken the time to examine their funds on our platform, showing the growing awareness and commitment to ethical investing across the country.
For example, KiwiSaver investments in nuclear weapons have plummeted from over $100 million in 2019 to $13 million currently, despite a huge increase in overall KiwiSaver funds. The investment providers are getting the message that their clients don’t want their money to be invested in making nuclear weapons. As a nation, we've long stood against nuclear weapons, and now our investments are starting to reflect our values
There is still $9.3 billion of KiwiSaver investment in harmful activities
Despite the progress, there is still a significant gap between the issues that the public wants to avoid, as shown in annual surveys, and the companies their funds actually invest in.
Some fund managers are too focused on short term returns. Examples are increased investment in the world’s worst oil and gas companies when oil prices rose after Russia invaded Ukraine, or investments in weapons companies that have profited from bombing in Gaza.
In the long term, there is evidence that ethical investment returns are at least as high or higher than conventional investing. Chasing short term returns from investing in harmful activities is unethical and against the wishes of most investors. It is also financially risky, relying on fund managers believing they can time the rises and falls of financial markets.
The positive trends we've observed so far give us confidence that, with continued awareness and action from investors, we can significantly reduce these figures in the coming years.
How You Can Further Support the Ethical Investment Movement
- Share the word: Everyone with a KiwiSaver fund is an investor, and their investments impact the world. Encourage people to understand what they're investing in by using our checking tool, enabling them to make decisions that align with their values.
- Contact your providers: Reach out to them, ask questions, express your values. Your enquiries and feedback are crucial. Let them know you care about where your money goes and its impact.
- Arrange educational seminars: We offer informative sessions on ethical investing for various groups. Whether you're part of a workplace, church congregation, community organisation, or any other collective, we're here to help. Please contact info@mindfulmoney.nz to organise.
- Collaborate: The path to widespread ethical investing is one we walk together. By joining forces, we can amplify our impact and accelerate positive change, please reach out to info@mindfulmoney.nz