Source: National Capital
KiwiSaver financial advisory firm and industry watchdog National Capital has revealed that more than one million New Zealanders have invested in ESG (Environmental, Social, Governance) funds – making up 39% of all KiwiSaver members. The total value of these investments at retirement is projected to be $244 billion, underscoring the growing interest by Kiwis towards ethical investing.
In the latest Value for Money (VFM) report, National Capital analysed 110 KiwiSaver funds, making up approximately 95% of the total value of KiwiSaver and of these funds, 51 were classified as ESG-focused funds*.
Key findings from the report:
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ESG Popularity: 39% of KiwiSaver members, equating to 1,099,103 New Zealanders, have invested in ESG (Environmental, Social, Governance) funds. The projected total value of these investments at retirement is around $244 billion.
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ESG Fund Performance: The Booster KiwiSaver Socially Responsible High Growth fund stands out as the top performer among ESG funds, boasting a 5-year return of 9.99%.
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ESG vs. Non-ESG: Over the past 5 years, ESG funds have outperformed non-ESG funds in Aggressive and Moderate risk profiles.
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Investment Costs: ESG funds generally have higher fees compared with non-ESG funds across all risk profiles.
The top-rated ESG-focused funds, per category:
Based on historical five-year returns until March 2024:
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High Growth: Booster’s Socially Responsible Growth fund 9.99%
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Growth: Simplicity Growth 7.82%
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Balanced: Superlife Ethical 6.26%
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Moderate: BNZ Moderate 3.73%
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Conservative: Fisher Funds Two CAsh Enhanced 2.98%
“As more New Zealanders become concerned about the ethical implications of their investments, they’re scrutinising their KiwiSaver. ESG funds are gaining momentum with more Kiwis investing according to their values,” – Ilma Coverdale, National Capital Financial Adviser.
At National Capital, we help investors choose the right fund based on their values, including any ethical concerns and their financial goals – be it retirement or the purchase of their first home. The good news is, when it comes to choosing a KiwiSaver fund, you don’t have to choose between your head or your heart,” Ilma adds.
*Based on National Capital’s research – deep diving into the ethical investing claims of providers.
About National Capital:
National Capital is a KiwiSaver specialised advisory firm dedicated to helping Kiwis make informed decisions about their KiwiSaver investments. Through in-depth research and personalised advice, National Capital ensures clients can invest with confidence and peace of mind.
About National Capital’s Value for Money (VFM) report:
The quarterly report analyses the state of the KiwiSaver market, quarter to quarter – providing insights and a snapshot of how Kiwis are planning for retirement. The report utilises data from National Capital, the FMA and a variety of other data sources to identify some key narratives Kiwis should consider when planning for the future. National Capital uses its comprehensive review system to grade different funds by type across six key pillars: Performance, Fees, Capability, Stability, Processes & Portfolio and Ethical Investing. Through these, Kiwis are informed about which funds are best overall and by key pillar, as well as an analysis of what to be mindful of when selecting a fund.
