75% of New Zealanders want responsible and ethical investment - how do we make that a reality?

Today I attended the launch of Mindful Money and the Responsible Investment Association Australasia’s annual survey Voices of Aotearoa: Demand for Ethical Investment in New Zealand 2025.

The headline results of the survey are ostensibly encouraging - 75% of respondents want their KiwiSaver or investment fund to be invested ethically and responsibly, 68% of Gen Z and 63% of Millennials are willing to move their money if their fund engages in activities inconsistent with their values, 75% are aware of ethical investing (up from 64% in 2022) and 45% either strongly agree or agree that ethical and responsible investments will perform better in the long term.

But dig a little deeper and there are some less positive results. Of the 75% of respondents wanting ethical and responsible investment, the result is skewed 81% to 67% in favour of women, and the older a respondent was the less likely they were to expect ethical and responsible investment. And there is a significant difference between desire and reality - when asked why they chose their current KiwiSaver provider only 10% said because it aligned with their values and a further 8% because they thought was best for ethics and sustainability. By comparison a combined 49% said they chose their KiwiSaver provider because they also bank with them, or they were the default option.

While the results in the above paragraph may require action on the part of individuals, there is room for improvement in the financial services industry too. 41% of those surveyed said they were not asked about ethical, environmental or social preferences when discussing investment objectives with your financial adviser. Respondents also raised concerns about a lack of transparency in the companies their provider has invested in, greenwashing, poor communication, and a lack of independent information as barriers to switching to a responsible/ethical provider.

The session got me thinking about my own KiwiSaver account. When I returned to New Zealand a few years ago I became one of the near majority who set up their Kiwisaver with their main bank, in my case ASB. In my defence I did choose ASB’s Positive Impact Fund, however that closed in January 2025 due to the closure of the underlying Blackrock fund. Something I hadn’t considered at the time, but on reflection should I have been more concerned that the fact ASB labelled one KiwiSaver option ‘Positive Impact’ implied that all the other options available weren’t positive? In any case, I’ve made the decision to move my KiwiSaver to Pathfinder’s new High Growth fund.

Something I’d love to know the answer to but haven’t been able to locate is the percentage of the total KiwiSaver pot that is invested ethically and responsibly. I’d hazard a guess that it isn’t anywhere near 75%. What can be done to close the gap between what New Zealanders say they want and reality? Sure, individuals need to take some responsibility for proactively choosing a KiwiSaver provider that aligns with their values, but the financial services industry also has a role to play in incentivising the public to take more interest in their investments - for a start by discussing an investor’s preferences, and also by demystifying how their investments are made, the companies that they are invested in, and communicating the positive impact of their investments.