Press Release: KiwiSaver investments should respect Human Rights

Investment in illegal Israeli Settlements in Occupied Palestinian territory

Last month the International Court of Justice affirmed that Israeli settlements in occupied Palestine violate international law. This affirmed the unanimous UN Security Council resolution 2334, which was co-sponsored by New Zealand in 2016.

Mindful Money wrote to New Zealand fund managers in November 2023, calling on them to divest from the companies that were most directly involved in constructing and financing settlements, providing surveillance and producing equipment used to destroy Palestinians’ homes.

However, the latest data shows that investment in KiwiSaver funds increased by 20% in the six months to March 2024 to $85 million, far beyond the rate of growth in overall KiwiSaver funds (14%). The corresponding growth in managed funds was 13% to $59 million (overall growth rate 9%).

Barry Coates commented: “The settlements on occupied Palestinian territories have been declared to be a gross violation of international human rights law. Palestinian people have been forcibly displaced from their land and homes, supported by the Israeli military and global companies. Investing in those companies may be legal for KiwiSaver and other investment funds, but it is certainly not an acceptable moral position.”

“Fund providers have the information they need to get out of these investments, but many have chosen not to do so, including actively managed funds. Mindful Money is reiterating our call for them to divest.”

“Members of the public can see what their funds are invested in on Mindful Money, and whether they are invested in the companies supporting Israeli Settlements in occupied Palestine. They can choose to switch funds if they don’t get assurances that their fund provider will divest.”

“There has been a long and frustrating history of high level engagement to try to convince companies to stop supporting settlements. Fund managers now need to divest. Mindful Money is calling on fund providers to stop supporting the worsening violations of human rights, and get their investment out of the companies contributing to the settlements.”

Investing in weapons used in Gaza

In July, Mindful Money’s analysis revealed that Kiwi funds were invested in companies producing weapons used in Gaza, as at 31 March 2024. Investments include weapons systems delivering white phosphorus, which causes long lasting burns to civilians in the vicinity.

Now, further analysis shows that investments were made by 123 KiwiSaver and retail investment funds, and that there has been an increase of 35% in investment by individual Kiwi investors over the past six months.

The information sparked a strong public reaction. Over 11,000 people have visited our website to check their KiwiSaver over the past two weeks.

The images of civilians being killed, buried, injured and displaced by massive bombardments have been shocking. Many Kiwis feel deeply uncomfortable that their funds would be used to invest in companies making profits from those weapons.

Concerns over human rights violations and weapons should not be a surprise. For the past six years, annual surveys of the New Zealand public, undertaken by Mindful Money and the Responsible Investment Association of Australasia, have shown that the public has a stronger aversion to human rights violations in their KiwiSaver and other investment funds than any other issue. The 2024 annual survey shows that 92% of New Zealanders want to avoid human rights violations and 80% want to avoid weapons.

Barry Coates, co-CEO of Mindful Money commented: “KiwiSaver and investment providers should not be profiteering from the misery of others. New Zealand investments in Gaza have increased sharply over the past year as weapons companies have made higher profits, at the cost of civilian lives. This is not the type of investments that most Kiwis want in their KiwiSaver fund.”

Human rights violations in New Zealanders’ investments

The most striking trend in KiwiSaver and other managed fund investments has been the increase in holdings of companies that have a record of violating human rights. KiwiSaver investments in companies with a record of human rights violations rose 44% to $2.1 billion while managed funds rose by 64% to $1.47 billion.

Many of the funds that have policies to exclude producers like tobacco companies or landmines do not have similar exclusions on companies that have a record of violating human rights. Or if they do have a policy, it is often at the level of principles, without clear criteria that support a rigorous analysis.

Barry Coates, co-CEO of Mindful Money commented: “Annual surveys show that the vast majority of Kiwis do not want to invest in companies that violate human rights. This is important to investors. However, analysis of portfolios of KiwiSaver and managed funds shows that their fund providers are not treating human rights as an important factor in their investment decisions.”

People power

Members of the public can easily see what their fund is investing in by going to the Mindful Money website www.mindfulmoney.nz. Mindful Money is a charity and provides transparency to KiwiSaver and retail funds investors.

Members of the public can check what is in their fund using the free Fund Checker. There are details of companies investing in Israeli settlements here and in weapons used in Gaza here, with a guide to taking action here.

Contact:

• Barry Coates, Co-CEO Mindful Money
• barry@mindfulmoney.nz

Notes for Editors:

Mindful Money publishes the methodology for identifying weapons companies and companies that have a record of breaching internationally-agreed human rights norms.

Weapons investments are shown in the categories of nuclear weapons; controversial weapons (including landmines, cluster munitions, depleted uranium, white phosphorus and chemical weapons); firearms; and military weapons. Companies cited for supporting Israeli settlements in occupied Palestine include:

Caterpillar, a manufacturer of heavy equipment, has a history of supplying the Israeli military. In 2004, Human Rights Watch reported Caterpillar D9 bulldozers were used to demolish over 250 Palestinian homes in Gaza, resulting in numerous Palestinian casualties. In 2017, the Israeli military acquired more Caterpillar vehicles through a U.S. government-financed deal. As of 2023, Caterpillar equipment continues to be used in demolishing Palestinian homes in illegally occupied territories, constructing illegal settlements and infrastructure, and building walls in the West Bank and Gaza. These settlements in occupied Palestine continue to be linked to severe human rights violations.

Motorola Solutions is an American provider of communication products, video equipment, telecommunications equipment, software, systems, and services. Motorola Solutions and its subsidiary, Motorola Israel, have been accused of complicity in human rights violations by selling communication products to the Israeli Ministry of Defence for use in occupied Palestinian territories. Israeli settlements in these territories are considered illegal under international law and continue to be linked to severe human rights violations. The 2023 United Nations Human Rights Council Report identified Motorola as a company supporting the maintenance and existence of these settlements. As of 2023, Motorola is the sole supplier of the Israeli Military's 4G cellular network and provides their surveillance and security system, which is reportedly used for border surveillance in the occupied Palestinian territories.

Human rights violations are shown in the categories of breaches of labour rights; war and conflict; corruption and breaches of business ethics; public health and safety; and other violations including privacy and indigenous peoples’ rights. Companies cited for Human Rights violations include:

Meta Platforms is the world’s largest online social network consisting of the Facebook app, Instagram, Messenger, WhatsApp, and many features surrounding these products. The company has faced several investigations and legal action linked to privacy-related allegations, including its handling of user data, and breaches of user privacy. Meta has also been criticised for its poor governance model, as well as allowing its platform in non-English speaking countries to be used to incite ethnic violence. The issue of abuse of data privacy is shown by annual surveys to be of concern to most New Zealanders.

Thermo Fisher Scientific sells scientific instruments and laboratory equipment, diagnostics consumables, and life science reagents. Thermo Fisher DNA testing kits have been linked to surveillance and discriminatory purposes by the legal authorities in Xinjiang (a region of China) for monitoring and tracking the Muslim Uyghur ethnic group and other minorities. Evidence shows Thermo Fisher Scientific continues to supply DNA sequencing products to the Xinjiang region, despite the company announcing it would halt sales to the region in 2019.

Rio Tinto is a global diversified miner, predominantly in iron ore but also copper, aluminium, diamonds, gold, and industrial minerals. Evidence shows that in 2020, Rio Tinto destroyed Aboriginal 46,000-year-old sacred sites at an iron mine in the Pilbara area of Western Australia, leaving a considerable impact on the traditional owners from the loss of their heritage. There is also a pattern of evidence showing harmful community-related incidents involving Rio Tinto in West Papua, South Africa, Canada, the United States and Serbia.

Johnson & Johnson is the world's largest and most diverse healthcare firm. The company has been involved in repeated incidents related to the quality and safety of several of its products across all three of the company’s business segments — drugs, devices, and consumer products. Several products have been associated with allegations of severe or even fatal adverse impacts on patients. One example is the thousands of lawsuits since 2009 alleging that the company’s talc products contained traces of asbestos which causes mesothelioma and is associated with several forms of cancer.