New Zealand No 1 for investor safety

New Zealand has shot to the top of a global survey for investor protection and corporate ethics despite the collapse of the finance company sector and property company Blue Chip costing investors millions.

The Word Economic Forum's Global Competitiveness report lifted New Zealand's rank from fourth to first when it comes to protecting small shareholders' interests and from fourth to first for the ethical behaviour of firms this year.

Market commentator Arthur Lim said the collapse of the finance company sector in New Zealand had exposed some big holes when it came to protecting small investors which were only now being plugged.

But that paled in comparison to some of the overseas problems investors had experienced.

"We have seen in the US the single biggest con job in the world with Madoff. This time around we just haven't had the same kind of excessive and wholesale frauds that have happened in other countries and that puts New Zealand in reasonably good stead," Lim said.

Shareholders Association deputy chairman Des Hunt said small shareholders had a strong voice in New Zealand.

"Overseas they have large institutions and a lot of investing is done through large investment houses and investors just let them do the work."

Lim said he was not surprised by the high ranking for corporate ethics.

"It comes down to basic decency in the corporate sector and basic trustworthiness and that is where I think New Zealand would score well."

Overall New Zealand ranked 20 out of 133 countries for the index, up four places on last year.