Commonwealth Group wants more specific SRI guidelines in Super Fund

Thursday, April 26th 2001, 12:32PM

Investment management and financial services entity Commonwealth Group* has suggested to the Finance and Expenditure Select Committee that more specific guidelines on ethical or socially responsible investing (SRI) should be put in the New Zealand Superannuation Bill.

Representatives of the Group today appeared before the Select Committee to recommend more comprehensive wording for clause 58 (2) C, which instructs the Guardians - the Fund’s trustee board – on how they should invest the Fund.

The clause currently instructs the Guardians to manage the Fund so as not to damage New Zealand’s reputation as a good international citizen.

Michael Hill, Head of Business Management for Commonwealth Investment Management, and Mark Bytheway, C.E.O. of Sustainable Investment Research Institute Pty Ltd, suggested to the Select Committee that the legislation needed to be as clear as possible to assist the Guardians.

The Commonwealth Group recommended that the legislation should instruct the Guardians to develop sustainable economic, social and environmental outcomes from investments that would enhance New Zealand’s reputation.

The aim of the Group’s submission was to help the Government achieve its superannuation objectives by making the legislation as robust as possible.

The Commonwealth Group views SRI (which has evolved from ethical investing) as a permanent feature in the funds management industry.

Given the potential size of the Superannuation Fund, its approach to SRI is very likely to create a benchmark for the rest of the New Zealand investment market.

The Commonwealth Group’s investment managers include Colonial First State Investment Managers (NZ) Ltd, and Australian firms Commonwealth Investment Management and Tactical Global Management. Other New Zealand members of the Commonwealth Group are ASB Bank, Sovereign Ltd, and Jacques Martin New Zealand Ltd.

* The Commonwealth Bank of Australia (incorporated in Australia) and subsidiary companies.

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