Responsible investing: it’s more than just exclusions

18 April 2023

It’s clear to us that many of our investors are interested in responsible investments. That’s why we're happy to announce that a number of our funds have received certification from the Responsible Investment Association Australasia (RIAA).

This is a significant achievement for us, as RIAA's Certification Program is the longest-running responsible investment program, globally. It shows we’re investing our members’ money in a responsible way and generating sustainable returns for them.

Company exclusions are just one part of our process

At ANZ Investments we take a comprehensive approach to researching, selecting, and managing investments that goes beyond simply excluding certain companies.

We do not invest in companies involved in harmful activities, such as the manufacturing of controversial weapons and tobacco, and we avoid others that derive a significant amount of their revenues from other activities, such as the extraction of unconventional oil and gas and the production of adult entertainment. You can find more information in our Responsible Investment Framework.

However, we also look to integrate environmental, social, and governance (ESG) factors into day-to-day investment decisions, and we actively engage with and vote on proposals that impact the companies we do invest in.

We take ESG factors into consideration when choosing investments

We integrate ESG factors into our investment process to improve long-term returns for our investors. We do this not only when identifying which investments to invest in, but throughout the time we hold them in our funds.

Our approach involves evaluating both financial and non-financial factors, whereas traditional investment methods focus primarily on financial criteria like revenue, or earnings forecasts. These factors encompass a range of issues, such as the environment (climate change, pollution, renewable energy), society (human rights, community impact, employee safety and diversity), and governance (ethical standards, transparency, compensation, and voting).

We believe considering these factors, as well as the risks and opportunities they present, is essential for successful investment management. If a company does not meet the expectations of its customers, stakeholders, and communities regarding any of these factors, it could – amongst other things - lose its social license to operate. This could negatively impact the company's long-term success and investment returns.

Our engagement with the companies we invest in

Engagement or stewardship is the final crucial element in our approach. Being the largest fund manager in the country, this allows us to influence the company's future direction by having our say. We may vote on issues such as electing directors to a company's Board, executive pay, climate transition strategy, and company disclosures. Every year, our portfolio managers and external fund managers vote on thousands of matters across the many companies we invest in, all on behalf of our investors.

Our Stewardship Updates, which are available on the ANZ website, provide information about some of the engagements we've undertaken. We've also made our proxy voting records publicly available too.


Which of our funds have been awarded RIAA certification?

We're happy that many of our multi-asset-class funds have received RIAA certification for responsible investing, including those in the ANZ KiwiSaver Scheme, OneAnswer KiwiSaver Scheme, ANZ Investment Funds and OneAnswer Multi-Asset-Class Funds. A full list of our certified funds can be found on RIAA’s Responsible Returns website.

Certification shows that we consider environmental, social and governance factors when making investments, and it demonstrates our commitment to transparency and good practice.

We’d point out that even if a fund hasn't been certified, we apply the same, consistent, responsible investing process to all of our investment offerings.

Proud to support The Aotearoa New Zealand Stewardship Code

We have other responsible investment credentials too. As well as being a signatory to the United Nations Principles for Responsible Investment, we are proud to support the recently-launched Aotearoa New Zealand Stewardship Code, and be a Founding Signatory.

The Stewardship Code outlines nine principles and provides a solid foundation for good practice in responsible investment in New Zealand, and there is strong alignment with ANZ Investments’ existing practices and approach. Supporting the code is important because it helps promote and encourage better stewardship practices, both locally and globally, and as a Founding Signatory, we can be at the forefront of driving this change. You can learn more about the Stewardship Code in our latest Stewardship Update.

Things are changing quickly in the responsible investment world, and our team is always looking for ways to improve how we incorporate exclusions, ESG factors and stewardship in our investment process. We'll keep you updated on any changes as they happen.