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The Guardians has a developed a robust track record as a responsible investor over many years. Our approach has supported us in managing environmental, social and governance (ESG) risk, whilst delivering strong financial returns for New Zealanders.

 

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Matt Whineray, Chief Executive Officer

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Our commitment to responsible investment and our early adoption of a climate change investment strategy has served us well, and over the last 20 years we’ve developed a strong track record as a responsible investor.

We've been included in the UN Principles for Responsible Investment Leaders Group, named one of the world's most responsible asset allocators and won a host of awards.

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  • Included in the UN Principles for Responsible Investment Leaders Group
  • Named one of the world's most responsible asset allocators
  • Won awards for our approach to responsible investment

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We have delivered strong financial returns for New Zealand taxpayers, including being named the top performing sovereign wealth fund globally.

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Named the top performing sovereign wealth fund globally

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We’ve also thought hard about where we need to take our approach to responsible investment over the next decade, in order to maintain a leadership position and to retain the confidence of our stakeholders.

We do this as part of ensuring — and this is obviously critical — that we meet our commercial mandate.

Globally, investment practice is evolving from a responsible investment model which is focused primarily on managing environmental, social and governance or ESG risk, towards a sustainable finance focus.

This is about ensuring the financial system serves the long-term wellbeing of society, the environment and the real economy.

It's a real mindset shift for professional investors: from considering the impact of these ESG risks on the portfolio of assets we manage to considering the impact of our portfolio and the assets in it on the world and society.

Fundamentally, these changes are being driven by changing consumer and stakeholder expectations.

They're also driven by an understanding amongst investors that companies that do a good job of managing ESG risks perform better over the long term.

And at the same time, the data and tools available to measure and monitor ESG performance are developing rapidly.

Our sustainable finance strategy, designed to see us through the next 10 years, is built around 3 core concepts from the roadmap developed by Toitū Tahua, New Zealand’s Centre for Sustainable Finance:

  • Changing mindsets — through our governance, leadership and communication
  • Transforming finance — by improving ESG performance over the long term
  • Financing transformation — investing for impact

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  • Changing mindsets — through our governance, leadership and communication
  • Transforming finance — by improving ESG performance over the long term
  • Financing transformation — investing for impact

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Within this framework, we’re progressing a range of initiatives to shift the NZ Super Fund to a sustainable finance approach.

These include committing to having a net zero NZ Super Fund by 2050, scaling up our impact investments in an effort to allocate capital to sustainability solutions with the required commercial returns, and investing in fewer companies with better ESG performance across the global equity portfolio.

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  • Committing to have a net zero Fund by 2050
  • Scaling up our impact investment
  • Investing in fewer companies wth better ESG performance

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Perhaps most importantly, we’ve changed our organisational purpose to embed sustainability at its core: Sustainable investment delivering strong returns for all New Zealanders.

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Our purpose - Sustainable investment delivering strong returns for all New Zealanders

Logo of NZ Super Fund, Te Kaitiaki Tahua Penihana Kaumātua o Aotearoa

 

With changing stakeholder expectations, regulators and advances in global best practice, investment approaches are evolving rapidly.

In 2020 we undertook a comprehensive review of our responsible investment approach, with the aim of understanding what might need to change to ensure we remain at the forefront of good practice and continue to meet all pillars of our mandate.

This review indicated a substantial shift towards improved incorporation of sustainability across the finance sector. In order to meet our mandate and best position the NZ Super Fund for 2025 and beyond, we embarked on a multi-year plan to update our approach from a responsible investment to sustainable finance focus.

Whilst a responsible investment approach involves managing ESG risks in our investments, sustainable finance means taking into account ESG risks and the implications of our investments for the environment and society.

Against this backdrop of evolving global good practice the Guardians' Board approved a new purpose: 'Sustainable investment delivering strong returns for all New Zealanders', and a new Sustainable Finance Strategy, designed to see us through the next 10 years. The Strategy is built around 3 core concepts developed by Toitū Tahua, the New Zealand Centre for Sustainable Finance:

  • Changing mindsets - through our governance, leadership and communication
  • Transforming finance - by improving ESG performance over the long term
  • Financing transformation - investing for the impact that delivers positive sustainability outcomes  

The Guardians has had a multifaceted climate change investment strategy in place since 2016. Designed to address climate change investment risks and opportunities over the long term, it remains a key element of our sustainable finance approach.

We collaborate and exchange sustainable investment resources with three other New Zealand Crown Financial Institutions: the Accident Compensation Corporation (ACC) the Government Superannuation Fund Authority and the National Provident Fund.

In addition to applying sustainable finance principles when making investment decisions, we aim to run the Guardians as an organisation in a way that demonstrates our commitment to sustainability and transparency.