Responsible investing keeps gaining steam in New Zealand
As it turns out, more and more Kiwis are embracing responsible investing. According to the latest Responsible Investment Association Australasia (RIAA) report, the market for responsible investing is “soaring in popularity” – twice as fast as overall managed investments.
Here are some key insights to know from the Benchmark Report 2021.
Responsible investing set to become the ‘new normal’
According to Nicolette Boele, RIAA executive policy and standards, ethical investing in New Zealand has grown significantly over the last 20 years. As Kiwis become savvier and more interested in investing, also taking into account their climate change worries, they are putting their money into ethical and responsible investment vehicles.
In 2020, amid wider market slump, responsible investment assets grew at double the rate of all professionally managed investments, now making up 43 per cent of all those funds (or $142 billion). The report also found that sustainability-themed investments have increased more than 15 times since 2019, to $21.7 billion assets under management (AUM).
A ‘critical’ transition of the finance realm
As Boele pointed out, over the past 20 years, responsible investing has gone from niche to more mainstream, in particular around climate change and use of natural resources.
Boele said that the report suggests that New Zealand is leading the responsible investing charge, with Kiwi investors moving to effective investment policies that support their rising materiality of different social and environmental issues. "Increasingly, responsible investment is being defined not just by the strategies involved, but by the short and long term social and environmental outcomes that investors are targeting and generating through their responsible investment approaches.”
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