8 Feb 2024

Mindful Money: a website for checking out where your KiwiSaver is invested

From Afternoons, 3:15 pm on 8 February 2024

KiwiSaver funds are moving away from investing in harmful products, the ethical investment charity Mindful Money revealed last week.

Their website is a good place to check out the kind of investments your own KiwiSaver provider is involved in, says personal finance expert Mary Holm.

a jar of coins with a plant growing in it

Photo: Towfiqu barbhuiya

'"They've done the dirty work and had a look at all the different shares they're invested in so I really recommend people having a look," she tells Jesse Mulligan.

The biggest change Mindful Money discovered was reduced investment by KiwiSaver providers in tobacco companies, Holm says. In six months, there was a 72% reduction in investment in tobacco companies.

There was also a 24-to-35% reduction in their investments in weapons, gambling, products that test on animals or cause animals suffering and alcohol, and smaller reductions in investments in pornography and adult entertainment.

On the other hand, $7.9 billion of KiwiSaver funds are still invested in companies involved with fossil fuel and weapon production, animal cruelty and human rights violations.

Impact investing, where providers align with the companies involved in "good stuff" such as renewable energy and social housing is just one form of ethical investing, Holm says.

Another approach taken by some investment funds is to deliberately support companies that "do environmentally dodgy stuff" so they can go along to their annual meetings and have some influence.

Although some individuals may not mind if ethical investment delivers lower returns, others will ask, understandably, if there isn't a way to 'do well by doing good', Holm says.

Generally, overall, the answer is yes.

In recent years, she says, ethical funds have done as well or better than so-called 'sin stocks' which invest money in alcohol, tobacco, gambling, sex-related industries, weapons manufacturers, nuclear plants and landmines.

"There is one argument that says you should invest in both because the broader your diversification, the better your investment strategy is, but I think we can conclude that you can be in ethical investments and you're not really sacrificing return and possibly you're doing better than average."

As "a good website with general information about investments", Mary Holm recommends Investopedia.