Mercer revamps default fund so KiwiSaver members can make impact without sacrificing performance

 

 

New Zealand, 9 September 2020 – Mercer New Zealand has enhanced its default KiwiSaver Conservative Fund; the updated fund will prioritise Responsible Investing (RI) strategies and will see a 19% annual fund fee decrease for members. This default fund will actively invest in industries that generate positive, measurable social and environmental impact alongside a financial return. The fund also further divests from industries that New Zealanders do not support, such as investments that may damage the environment.

 

While Mercer builds comprehensive RI strategies into all its funds, the default Mercer KiwiSaver Conservative Fund will also feature: added investments for creating a positive impact such as pollution control and energy efficiency, further remove investments that do not align to New Zealanders’ values including fossil fuels and weapons, and a 19% annual fund fee decrease for members. 

 

“Based on our research, we know that New Zealanders are incredibly passionate about investing in a way that makes a difference. Financial markets can no longer be isolated from environmental and social issues,” said Sarah Whitelock, Consumer Wealth Leader, Mercer New Zealand. “The good news is, you don’t have to sacrifice the greater good for higher returns.”

 

“While KiwiSaver members still prioritise investment performance, data shows that this doesn’t have to come at the expense of the greater good,” noted Whitelock. “There is often a misconception that targeting responsible or sustainable outcomes comes at the cost of performance, but we are seeing more and more data come out arguing the exact opposite. According to Responsible Investment Association Australasia (RIAA) and Morningstar, RI funds can outperform mainstream funds over a number of time frames and asset classes.”

 

“We are seeing a growing worry from KiwiSaver members about whether their retirement savings are invested in industries that have a negative impact on our environment and society. Mercer believes a sustainable investment approach is more likely to create and preserve long-term value, will increase member engagement, and is in KiwiSaver members’ best interest. This fund will help achieve that, and is the beginning of many exciting changes we have coming up in KiwiSaver,” Whitelock added. 

 

Many KiwiSaver members want to use their investments to support the issues that matter to them, but they may not be sure how to do it. “If KiwiSaver members want to shape the world they retire into, they need to exercise their power as consumers through careful choice. By using fund choice as their voice, members are effectively telling fund managers how well they are doing on environmental and social issues,” said Whitelock.  

 

Mercer has long been a supporter of RI and through its global investment consulting business has advised investors on all aspects of RI since 2004, are a leader globally on climate change analysis, are rated A+ for RI strategy and governance by the global body the Principles of Responsible Investment, and are certified by RIAA as a responsible investor.

 

All KiwiSaver members in Mercer’s Conservative Fund will automatically benefit from these changes to the Mercer Conservative Fund from September 2020. 

 

 

About Mercer

Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. Mercer’s more than 25,000 employees are based in 44 countries and the firm operates in over 130 countries. Mercer is a business of Marsh & McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people, with 76,000 colleagues and annual revenue of $17 billion. Through its market-leading businesses including MarshGuy Carpenter and Oliver Wyman, Marsh & McLennan helps clients navigate an increasingly dynamic and complex environment. For more information, visit www.mercer.co.nz. Follow Mercer on LinkedIn @Mercer New Zealand.

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