KiwiSavers want fund managers to stand against extremism on social media

Monday, 23 September 2019

KiwiSaver ditched most tobacco companies in 2017, but there's still a lot of 'sin stocks' in KiwiSaver funds. Each KiwiSaver fund invests in a different mix of companies. This video shows total combined holdings across all KiwiSaver funds.

Nine in 10 KiwiSavers want fund managers to put pressure on social media companies like Facebook to stamp out online extremism.

KiwiSaver provider Kiwi Wealth's annual responsible investment survey showed a 'hardening' public belief that KiwiSaver investments needed to match public ethical and moral priorities.

The fight against online extremism was one of the top concerns of investors following the March 15 murder of 51 people in Christchurch.

Three-quarters of people surveyed said they expected KiwiSaver providers to use their influence to compel social media companies to remove all objectionable and extremist content from their platforms, said Melissa Vasta, Kiwi Wealth head of product.

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Flowers lay at a memorial near the Masjid Al Noor mosque for victims in March 15 shooting in Christchurch. New Zealanders want KiwiSaver managers to use their power to pressure social media companies like Facebook to eradicate online hate and the streaming of violence and murder.

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'Kiwis increasingly want their personal values reflected in their investments,' Vasta said.

'They want to know where every dollar is invested and that their fund manager is making sound investment decisions that match their personal values.'

The survey showed 89 per cent of Kiwi investors expected their KiwiSaver scheme to invest responsibly.

Many people accepted their scheme would invest in some companies with a less than perfect social or environmental record, but they wanted KiwiSaver fund managers to 'engage' with companies to push them to behave more responsibly.

There was a growing group of investors taking a harder line. A third of people surveyed told Kiwi Wealth they would prefer KiwiSaver funds sell the shares of companies which were behaving badly.

Factory farming, and the mistreatment of animals, are things KiwiSaver investors do not want their money invested in.

'We think Kiwis also see through the lip service being paid to responsible investing by some providers, and it's only right they demand their providers be more transparent with where their money is invested,' Vasta said.

When it launched in 2007, most KiwiSaver scheme providers did not consider responsible investing to be a core priority.

That changed following media revelations in 2015 and 2016 that many schemes held investments in tobacco-producers, and companies involved in 'controversial' indiscriminate weapons like nuclear missiles, land mines and cluster munitions.

More pressure came on after the March 15 shootings for KiwiSaver schemes to divest of all weapons-makers.

In the aftermath of the shootings Kiwi Wealth joined the Social Media Engagement Initiative consortium of fund managers formed by the Accident Compensation Corporation and the New Zealand Super Fund to pressure social media companies like Facebook to invest in eradicating online hate, sickening violent content, and make it impossible to live-stream murder.

There is growing pressure for KiwiSaver fund managers to turn their backs on fossil fuel companies, as well as companies involved in practices that compromise animal welfare, such as factory farming.

Kiwi Wealth found human rights abuses (74 per cent), animal cruelty (68 per cent) and Labour rights abuses (64 per cent) were the most important environment and social issues KiwiSaver providers should positively influence through shareholder votes.

But there could also be law change on the way. The Government is consulting on whether to require all 'default' KiwiSaver funds, in which people who do not choose a fund themselves are invested, should be required to invest responsibly.