28 Apr 2022

Majority of investors expect KiwiSaver, funds to be ethical

6:49 am on 28 April 2022

Investment fund managers are under pressure to deliver as investors expect their money to make the world a better place.

Pile of New Zealand currency laying flat on table

Photo: 123RF

A new survey by the Responsible Investment Association Australasia (RIAA) and Mindful Money, shows nearly three-quarters of investors expect their KiwiSaver and investment funds to be invested ethically.

It also shows nearly two thirds want their investments to make a positive difference.

Mindful Money chief executive Barry Coates said with the ongoing trend towards ethical investment, fund managers could lose customers if they don't go with the flow.

"People are now at the point of saying; we will essentially be guided in our actions in choosing KiwiSaver or investment funds by these ethical considerations, and I think this process has kind of deepened over the four years that we've been doing these surveys and we're seeing a huge increase in the market for ethical investment," he said.

The number of funds offering ethical options have also increased, Coates said.

But he said investors had to be careful their fund managers weren't promoting misleading claims about ethics, known as greenwashing.

RIAA chief executive Simon O'Connor said the survey also showed half the population were apprehensive that fund providers were greenwashing and making misleading claims.

"With the barrage of new ethical investment products in the market, consumers are increasingly questioning sustainability claims made by investment managers," O'Connor said.

"They're looking to trusted third parties like RIAA's Responsible Investment Certification Program to do the heavy lifting, to make sure they are delivering on their claims."

Despite concerns about greenwashing, Mindful Money and the RIAA said the outlook was bright for ethical and responsible investing in Aotearoa.

It said in addition to those who already have an ethical fund, the survey found two-thirds of others intended to invest ethically in the future, with the majority wanting to do so from next year.

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