Responsible investment funds have outperformed the benchmark and the average of mainstream funds over the short and long term, locally and internationally, the latest Responsible Investment Benchmark Report says.
It shows that responsibly-managed funds in New Zealand totalled $22.6 billion this year, up 17% and representing 38% of total assets under management across the country.
The report is produced by the Responsible Investment Association Australasia and maps the growth in funds under management and the sector’s performance against mainstream Australian and New Zealand funds.
Chief executive Simon O’Connor said responsible investing was becoming more mainstream. “The strong outperformance of ethical and responsible investment funds should finally put to bed the myth that a more responsible approach to investing leads to lower returns.”
He said the extra analysis that was undertaken for every investment decision meant responsible investors had a deeper understanding of their investments. “It should be no surprise they are earning better returns.”
But O’Connor said investors were still not strongly engaged with responsible investing. He said the drive to look for ethical investments was mostly coming from institutions, as a risk-management strategy.
“The numbers aren’t telling us there is a strengthening demand from consumers. The experience is that that’s flatlined.”
In Australia, only about 1.5% of funds had been directed into responsible funds by the investor, even though they made up 16.3% of total funds under management.
He said more work needed to be done to raise awareness because the industry had matured and offered investors broader options across all asset classes, that could align with their values and beliefs.
Helpful to mention the list of funds is dominated by NZSF, which was $20.92b at 31 Dec 2012. List of New Zealand Funds included in this year’s New Zealand responsible investment benchmark:
AMP Capital New Zealand – Responsible Investment Leaders
ASB Community Trust
Craigs Investment Partners Investment Management
Fidelity Life
Just Dollar$ Trust
New Zealand Superannuation Fund
Pathfinder Global Water
Prometheus Finance
Super Life
The Methodist Church of New Zealand Investment Advisory Board
The Quaker Investment Ethical Trust
Trust Investments - Sustainable Australasian Share Fund
Trust Waikato
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AMP Capital New Zealand – Responsible Investment Leaders
ASB Community Trust
Craigs Investment Partners Investment Management
Fidelity Life
Just Dollar$ Trust
New Zealand Superannuation Fund
Pathfinder Global Water
Prometheus Finance
Super Life
The Methodist Church of New Zealand Investment Advisory Board
The Quaker Investment Ethical Trust
Trust Investments - Sustainable Australasian Share Fund
Trust Waikato