Most of the financial sector was at an early stage when it came to helping New Zealand towards net zero carbon emissions, the survey found. Photo: 123RF
New Zealand is not on track to meet United Nations climate change emission targets, nor the ones set domestically.
A survey by a coalition of investor organisations says there is a strong interest in helping New Zealand towards net zero carbon emissions, but most of the financial sector is still at an early stage when it comes to progress.
As a result, the survey by Investor Coalition for Net Zero indicates New Zealand was missing out on opportunities to attract a bigger share of the growing pot of net-zero aligned investments.
It says climate reduction actions had yet to be adopted widely across the finance sector.
Coalition member chief executive of Mindful Money Barry Coates said this was the time for investors to ramp-up action.
"We need to up our game, we need to accelerate the pace of change in the investment community," Coates said.
"We've had legacy of rising emissions for a long time in New Zealand and if you look at our performance, since the agreement on climate change we signed in 1990, we've been one of the worst in the OECD.
"So we are playing catch up. I think to some extent we're playing catch up in lots of areas of our economy and the investment sector is one of those."
Among the critical findings was New Zealand was making slower progress than Australia and other international leaders, such as the European Union.
"On an international comparison, the NZ investment industry is behind the Australian finance sector on virtually every measure surveyed, including the foundations for emissions reductions," the report said.
"Most wealth managers have yet to engage meaningfully on climate issues and most asset owners are not proactively setting mandates to incorporate climate risk and opportunities.
"Investment in climate solutions are low, indicating that most investors are not yet redirecting investment decisions," it said adding that while the overall progress was disappointing, there were some exceptions.
Larger investors, such as the New Zealand Super Fund, were doing better than smaller ones, although there were some stand-outs among the smaller firms.
Wealth managers were also lagging when it came to setting targets.
Only a third of asset owners, or six-out-of-17 respondents had any investment mandates that refer to emissions, net zero or decarbonisation.
"Among fund managers, the proportion of those including net zero requirements in external mandates was slightly higher at 43 percent."
The survey captures more than 80 percent of the fund management market, with an aggregate of $331 billion in assets.
