Short answer: responsible or ethical investing means the fund applies rules about what it will and will not invest in, commonly excluding things like weapons, tobacco or fossil fuels, or actively favouring companies that meet certain standards.
Key points: there is no single legal definition, so "ethical", "responsible", "sustainable" and "SRI" can mean quite different things between providers. Two ethical funds can hold noticeably different portfolios, and exclusions are often partial rather than absolute.
Worth checking: the fund's own statement of investment policy and objectives rather than the marketing label, so you can see the actual exclusions. Providers are regulated by the FMA, which has published guidance on how such claims should be substantiated.
More and more Kiwis are asking the question... āWhere is my money invested?ā
And rightly so.
KiwiSaver isnāt just about growing your retirement savings; itās also a powerful way to influence the world around you. Thatās whereĀ responsibleĀ andĀ ethical investmentĀ comes in.
Letās unpack what that meansā¦ and how to make sure your KiwiSaver aligns with your valuesĀ andĀ your goals.
š What Is Responsible Investment?
In simple terms, responsible investment meansĀ taking environmental, social, and governance (ESG) factors into accountĀ when choosing where your money goes.
That might mean avoiding:
- Weapons manufacturing
- Fossil fuels
- Tobacco
- Gambling
- Companies involved in human rights abuses
It also means favouring businesses that:
- Have strong climate policies
- Treat their workers fairly
- Have diverse leadership
- Are transparent and well-governed
Itās investing with yourĀ conscienceĀ - without compromising on yourĀ returns.
šø Does Ethical Investing Mean Lower Returns?
Nope - and thatās a common myth.
In fact, many responsible funds have deliveredĀ competitive or even betterĀ returns over the long term. Why? Because companies that look after their people, communities and the planet tend to be more sustainable in the long run.
So yes, you can do goodĀ andĀ do well.
š How Do I Know If My KiwiSaver Fund Is Ethical?
The truth is,Ā not all funds are as ethical as they sound. Some use vague language like āsustainableā or āgreenā without backing it up.
To find out where your money is really going:
- Look for anĀ RI or ESG ratingĀ on your fund
- Check if your Provider has signed the UNPRI (United Nations Principles for Responsible Investment) charter
- Check what companies and industries your fund invests in
- Ask your provider about theirĀ exclusion policiesĀ (i.e. what they avoid investing in)
Or better yet -get personalised adviceĀ from someone whoās done the digging for you.
š§ You Deserve a KiwiSaver Fund That Matches Your Values
Itās your money. You should feel good about where itās going - and confident that itās still growing.
Whether you care most about climate change, social justice, or simply not supporting companies you disagree with, I can help you:
- Find an ethical KiwiSaver fund that suits your values
- Understand the trade-offs (if any)
- Get strong long-term resultsĀ andĀ peace of mind
ā Take the Next Step
Hereās how to start making your KiwiSaver work for bothĀ youĀ and theĀ world:
Uncover whether your fund reflects your values.
š„ Book a Free 30-Minute Advice Session
Letās chat about where your moneyās really going.
Simple Steps. Solid Results
Sources and further reading
Primary New Zealand sources for the points above. Rules change, so check the current position before acting:
- Financial Markets Authority - the regulator overseeing how funds describe themselves.
- FMA guidance library - guidance on integrated financial products and claims.
- Sorted KiwiSaver fund finder - compare funds, including responsible investment options.
- Inland Revenue - making changes to my KiwiSaver - how to move if you want a different fund.
Get personalised KiwiSaver advice
Free 30-40 minute session with Cam. No obligation. Online anywhere in NZ or in person across Canterbury.
Book a free session