Big stories in the news this week reveal that millions of KiwiSaver dollars are invested in nuclear weapons production across 88 providers. A few weeks back, ANZ was called out for investing KiwiSaver dollars in the Saudi military.
So how did this happen, and what does it mean for you?
Do you know what your KiwiSaver funds are supporting?
Are KiwiSaver funds investing in nukes?
An analysis by Mindful Money showed that as of September 30, 2020, $210 million of KiwiSaver funds were invested in weapons production. Of this, $52 million is invested in nuclear weapons.
This is despite the fact that a survey showed 81% of Kiwis didn’t want their money invested in weapons, and 93% said they would switch funds if they found out they were investing in something they felt was unethical.
The result surprised Mindful Money founder Barry Coates, who said that a year and half ago they had identified investments in nuclear weapons and “thought that there was a process of funds getting out of them.”
ANZ is taking the hit - but they are not the only ones to blame
Green MP Chlöe Swarbrick said it was “appalling” and “devastating” to learn that ANZ invested in three separate companies - Raytheon Technologies, Textron, and BAE Systems - that provide weapons, munitions and aircraft for the Saudi military.
What is particularly distressing about this is that the three companies listed have supplied the Saudi military since Saudi Arabia became involved in the Yemen war in March 2015, implicating Kiwi dollars supporting a war that has caused a humanitarian catastrophe.
“There should be far more transparency but worse than this what is so deeply unethical should be illegal it should never have been happening in the first place,” Swarbrick told 1 NEWS. She promptly dropped ANZ as her KiwiSaver provider.
ANZ in turn announced they will review their investments. However, they are not the only ones who need to be held to account.
The Mindful Money analysis further reports:
Fifty-seven KiwiSaver funds are invested in Safran S.A., which produces components for nuclear missiles.
The NZ Super Fund is also guilty, with a spokesperson saying, “NZ Super Fund excludes companies involved in the manufacture of nuclear explosive devices, we do not exclude companies involved in the manufacture of delivery and control systems for nuclear weapons.” In other words, we won’t support the production of nuclear weapons, but we’ll help make sure the weapons get to their intended target. Hmm.
Questionable investments are nothing new
The thing is, this is no surprise.
Back in 2016, the NZ Herald announced that $152 million of KiwiSaver funds was invested in arms manufacturers and big tobacco - involving the investments of more than 2 million New Zealanders.
Then an investigation by RNZ found that five of the nine default KiwiSaver providers invested in cluster bombs and anti-personnel mines. Further, eight of the nine default funds invested in tobacco, nuclear devices, nuclear power, palm oil, gambling or pornography.
Most providers promised to review their investment practices - some did, while others let it slide.
BetterSaver caused a bit of a stir when we launched our ethical analysis platform in 2018. Our founder Joe Taylor developed a system to rate KiwiSaver funds on an A to F grading scale by independently assessing the impact of their funds on environment, society and governance (ESG).
Our initial assessment showed that no KiwiSaver fund scored from than a C+.
“Up until now KiwiSaver providers have been able to claim that they consider ESG matters when they invest, but there has not been the ability to independently verify the truth or extent of their ESG commitments,” said Joe.
While KiwiSaver providers say they take social responsibility into account, it is too often a blanket statement made without any data showing they have abided by their claims.
Need for transparency
Open communication from Providers to investors should be a given. But too often the information is buried deep, requiring a significant amount of time and patience to find.
That’s why BetterSaver has committed ourselves to doing the research for you. Our ethical ratings for each fund paired with easy-to-digest advice is provided for every New Zealander to have the ability to easily switch their KiwiSaver fund to the one that is best for them. If the providers will not be forthright in their investment practices, in clear, plain language - we’ll do it for you.
What is your KiwiSaver supporting?
When you sign up with KiwiSaver, you are automatically enrolled in a default fund. The idea being this is a temporary place to park your savings while you decide which fund is actually best for you. However, over 400,000 Kiwis have never moved from their default fund. This means many are likely not aware of what you are supporting with your investment - as well as missing out on money.
Even if you have selected a different type of fund, have you done your homework to see what exactly you have invested in? If not, don’t stress. We are here to help.
BetterSaver supports individual values
We firmly believe that every individual has a choice in what their money is invested in.
Back in November, we published an article bringing unethical investing and lack of transparency to light and explained how you can make sure you are invested in funds you are happy to be supporting (see “Is Your KiwiSaver Fund Killing Bunnies?”). If more Kiwis demand responsible practices, less financial support from NZ will go to devastating weapons of war and other undesirable funds.
BetterSaver makes it easy to switch to the right fund for you. We provide all of the information you need to invest in a fund that aligns with your goals, values and lifestyle. We are independent experts and here to guide you through every step to make sure you know what your dollars are supporting.
Get early access now and make sure you’re making the best decisions with your KiwiSaver!