Sustainable investing is becoming increasingly popular with more and more Kiwi’s showing their interest in the environmental, social and human capital impacts of the funds they are investing in. Due to this demand several funds have sprung up that are labelled “responsible”, “ethical” or “sustainable”. But do they really live up to label or is it just “greenwashing”?
According to the New Zealand 2020 Responsible Benchmark Report, published by the Responsible Investment Association Australasia (RIAA), there is still a gap between fund managers that claim to be practising responsible investing and those that have embedded these practices through formal policies and the disclosure of their full portfolio holdings.
FMA director of investment management, Paul Gregory, recently told providers of these types of funds that they need to back these claims up with hard evidence – asking fund managers to truly consider the ethical thinking behind their funds, and whether they can prove it.
If you are interested in investing in sustainable funds, reach out to your AdviceFirst adviser who will be able to talk you through some options and help you understand how the fund providers are substantiating their claims.