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Responsible Investing

NZ scopes a green taxonomy to provide a common language on sustainable finance

The government has begun work with Toitū Tahua: The Centre for Sustainable Finance (CSF) and the Climate Bonds Initiative on a green taxonomy for New Zealand.

Tuesday, March 26th 2024, 6:45AM

by Andrea Malcolm

A green or sustainable finance taxonomy is a classification system for defining which economic activities and assets are aligned to a sustainable, low-emissions future.

It aims to ensure everyone is on the same page when talking about sustainability, thereby making it easier for investors, lenders and regulators to counter greenwashing and build transparency and trust.

The CSF has convened an independent technical advisory group (ITAG) to prepare non-binding advice on the design of a taxonomy rule book for NZ Minister for Climate Change, Simon Watts. It will deliver its recommendations in June.

It has partnered with the Climate Bonds Initiative (CBI), an international organisation working to mobilise global capital for climate action.

At a webinar last week, CBI head of taxonomies Matteo Bigoni said a NZ green taxonomy could be used to attract green capital and align it with major trading partners developing their own such as Australia, the UK and the EU.

Frances Sweetman, head of responsible investing at Milford Asset Management said in Europe about 5% of all investment is in green funds.

With KiwiSaver there is demand for green funds but not a high number in the market because there isn’t a common language which is a risk.

“If we have that, we can reduce risk so that KiwiSaver providers have confidence to offer these products.”

Adam Coxhead, head of sustainable finance BNZ said sustainable finance arose from super sovereign agencies and then large corporates.

“Part of it is validation and verifying investments. A taxonomy will help accelerate commoditisation of sustainable products and reduce cost and complexity.”

The CSF is collaborating with the Australian Sustainable Finance Institute (ASFI) which is advising the Australian government on its green taxonomy.

ASFI head of taxonomy Nicole Yazbek-Martin said there are four key design principles; credibility (transparency and being informed by latest science and technology), interoperability between jurisdictions, usability and prioritisation for impact.

Australia has identified six sectors to prioritise, covering its biggest emitters; building, electricity, mining, agriculture, manufacturing, and transport.

New Zealand is in the scoping phase and recommendations to the minister will include initial thoughts on priority sectors here.

Advice will take similar form to recommendations provided by ASFI to the Australian government which are on the ASFI website.

Tags: Milford Asset Management

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AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.14 6.75 6.39
ANZ 8.64 7.74 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.14 6.79 6.65
ASB Bank 8.64 7.14 6.75 6.39
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.14 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.74 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 6.79 - -
Co-operative Bank - Owner Occ 8.40 6.99 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.49 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.89 6.55 6.35
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.69 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.39 7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 7.99 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 6.99 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.74 7.29 6.59
SBS Bank Special - 7.14 6.69 5.99
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.14 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 7.79 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 6.99 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - 6.55 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.89 7.35 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.75 6.65
Median 8.64 7.21 7.29 6.65

Last updated: 20 May 2024 10:01am

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