GNZS Help Drive New World-Wide Initiative on Corporate Behaviour (28 October)
POSTED ON: 27 October 2008
Auckland (Monday 27 October) - The New Zealand Superannuation Fund is part of a world-wide effort to encourage listed companies around the world to embrace international standards on human rights, working conditions, the environment and anti-corruption.
The initiative is being organised by a group of 52 significant investment funds who manage around US$4 trillion in assets. The group is writing to over 8900 listed companies.
"This initiative underlines our commitment as shareholders to encourage better corporate practices across global markets," said the Fund's Head of Responsible Investment Anne-Maree O'Connor.
The initiative is being launched today in London by the United Nations Principles for Responsible Investment. The group urges public companies across the world to sign the United Nations Global Compact. The Global Compact provides a framework to help companies incorporate universally accepted principles such as the United Nations Declaration of Human Rights into their business practices. The Guardians of New Zealand Superannuation have been part of the steering group that organised the initiative.
"We believe improving corporate practices according to the basic principles set out by the Global Compact will benefit investors over the long-term" said Anne-Maree O'Connor. "Experience shows us that the best performing companies over time are those that have good environmental, social and governance practices so that makes sense to us as a long term investor.
"It is important to remember that these issues do not disappear during difficult economic times as we are now experiencing. No company focused on the long term can afford to be fair weather advocates of these issues. Indeed, we believe companies that embrace good environmental, social and governance practices can achieve a competitive advantage in an increasingly challenging marketplace."
For more information please see the Responsible Investment section of our website.
For more information please contact:
Anne-Maree O'Connor, Head of Responsible Investment, New Zealand Superannuation Fund, 09 373 8954, 021 910 595.
Notes to editors:
The UN Global Compact
UN Global Compact Launched in 2000, the UN Global Compact brings business together with UN agencies, labour, civil society and governments to advance ten universal principles in the areas of human rights, labour, environment and anti-corruption. Through the power of collective action, the Global Compact seeks to mainstream these ten principles in business activities around the world and to catalyze actions in support of broader UN goals. With over 5000 participating companies and hundreds of other stakeholders from more than 120 countries, it is the world's largest voluntary corporate citizenship initiative. For more information, please visit www.unglobalcompact.org.
The Principles for Responsible Investment (PRI)
The Principles for Responsible Investment was established as a framework to help investors achieve better long-term investment returns and sustainable markets through better analysis of environmental, social and governance issues in investment process and the exercise of responsible ownership practices. The Principles themselves, a full list of signatories and more information can be found at www.unpri.org
About the New Zealand Superannuation Fund:
The New Zealand Superannuation Fund, which commenced investing at the end of September 2003, is designed to partially provide for the future cost of New Zealand superannuation. An ageing population means the cost of providing New Zealand superannuation is expected to double over the next 50 years. To prepare for this, the Government plans to allocate around $2 billion a year to the Fund over the next 20 years while the cost of superannuation is relatively low. In the meantime, the Fund will invest the money on a prudent but commercial basis.
As the cost of superannuation escalates, the Government will progressively draw on the Fund to help smooth the impact on its finances. As at 31 August 2008 the value of the Fund was $14.5 billion. The Fund is expected to grow to around $109 billion by 2025.
In addition to best-practice management portfolio, and to avoid prejudice to New Zealand's reputation as a responsible member of the world community, the Fund's objective is to maximise returns without undue risk to the Fund as a whole, and expects to exceed, before tax, the risk-free rate of return (measured as the yield on 90-day Treasury bills) by an average of at least 2.5% p.a. over rolling 20-year periods.