Greetings / Tēnā koutou 

This year’s Annual Report marks the first time we can report on the NZ Super Fund’s rolling 20-year performance data, a time period on which we have always based our long-term expectations and which we regard as a relevant period to judge the Fund's performance, given our inter-generational mandate. 

Over the 20 years to 30 June 2024 the Fund has returned 10.03% p.a. after costs and before domestic tax – well ahead of expectations. Notably, the Fund has earned $49.86 billion more than the return on Treasury Bills (a measure of the cost to the Government of contributing to the Fund instead of reducing debt) over those 20 years and $17.28 billion more than its passive Reference Portfolio benchmark.  

At 30 June 2024, the NZ Super Fund was worth a record $76.65 billion, up from $65.40 billion a year earlier, based on a return of 14.90% (after costs, before NZ tax) for the year. This strong result was largely driven by the Fund’s investments in global equity markets, which make up just over half of our total net exposure. 

Earlier this year, global advisory firm WTW completed the latest of our one-in-five-year independent reviews. These reviews, which are commissioned by Treasury on behalf of the Crown, are a statutory requirement, but also an opportunity for us to test our thinking and processes against industry best practice. 

The overall tone and findings of WTW's review were extremely positive. Their report described our investment process as globally exceptional, rated our governance model as excellent and noted our very strong practices in supporting an effective organisational culture. 

We are strongly committed to a sustainable finance approach, including our net zero by 2050 goal, and continue to make good progress in implementing our climate change investment strategy.  

We have long believed that ESG factors are an essential consideration in evaluating any proposed investment and that climate change in particular creates significant risks, and opportunities, for long-term investors like the Fund. 

I am, therefore, pleased to note that the Fund continues to exceed its carbon reduction targets. As at 30 June 2024, the Fund’s total carbon emissions intensity was 64.4% lower than our baseline level (2025 target: 40% lower), and its exposure to potential emissions from reserves was 98.2% lower (2025 target: 80% lower). 

More detail is contained in our 2024 Climate Change Report and Carbon Footprint Report, both of which are now available on our website. Alongside these two reports, we have for the first time published a separate Stewardship Report. The Stewardship Report details our sustainable investment policies and practices, in particular how they align with the UN-supported Principles for Responsible Investment, one of four measures we use to assess our operational efficiency. 

The Financial Sector (Climate-related Disclosures and Other Matters) Amendment Act, which came into effect in April of this year, requires certain organisations (Climate Reporting Entities, or CREs) to analyse and report on how they will be affected by climate change and to report on their climate-related governance, strategy, risk management, and to report  metrics and targets. 

While we are not defined as a CRE, we have chosen to prepare this year’s reports to meet the requirements of the Act. 

This year’s Annual Report is my first as Chair of the Guardians. It is also the first for our Chief Executive, Jo Townsend, who joined the Guardians in April of this year. The strong results achieved in the 2023/24 financial year are a tribute to the whole Guardians team, and to the values, purpose, and vision that underpin our culture and our character. 

As we commence the second quarter of the new financial year, we remain confident that the Fund is well positioned to take advantage of the competitive advantages provided by our organisational structure and our clear mandate, and to continue to fulfil our purpose:  

Sustainable investment delivering strong returns for all New Zealanders / Kia toitū te haumi hei hua mā- ngā tāngata katoa o Aotearoa. 

Nāku iti noa, nā / Yours sincerely 

John Williamson

MEDIA ENQUIRIES: John Redwood, [email protected], 021 2509 657.