A large chunk of New Zealander's money was going into weapons making, at $183.5 million.
A large chunk of New Zealander's money was going into weapons making, at $183.5 million.
Over $4 billion of New Zealanders' KiwiSaver money is invested in sin stocks, weapons makers and unethical companies, according the social enterprise behind a new online search tool.
Barry Coates, a former Green Party MP, has launched Mindful Money which breaks down the investments in KiwiSaver's 260 fundsand shows people what percentage of their fund is invested in 10 controversial areas.
Until now KiwiSaver members have been able to see the companies they invest in but have had to do their own research to find out what sectors or practices the companies are involved in.
Coates said he set up the online tool to allow greater transparency in the $59 billion KiwiSaver industry.
"The public has a right to know where their hard-earned savings are invested."
Coates said Kiwis had a strong interest in where their money was invested as was show by the review by providers in 2016 after a public outcry following stories in the Herald revealing millions of dollars had unwittingly been invested by Kiwis in nuclear weapons, cluster bombs and tobacco companies.
Coates decided to expand it beyond tobacco and cluster bombs and undertook research last year to find out which areas Kiwis were most concerned about.
That came up with 10 different sectors; fossil fuels, weapons, gambling, alcohol, pornography, tobacco, GMOs, palm oil, human rights and animal rights, with two thirds of people saying they wouldn't be happy to invest in those areas.
The research shows animal rights was the biggest category of those which Kiwis invest in with $1.4 million or around 2.5 per cent of KiwiSaver money going into companies involved in that sector.
Second behind that was investment in companies in the fossil fuel sector with $1.16 billion investor or 1.95 per cent.
Coates said for a country like New Zealand that was targeting being fossil fuel free it was a shame there weren't more KiwiSaver options available that met that criteria.
Kiwisaver update
Despite a pull-back on nuclear weapons and cluster bombs the research also found a large chunk of New Zealander's money was going into weapons making, at $183.5 million.
Coates said it used research from the New Zealand Superannuation Fund and its Norwegian equivalent to work out which companies met the criteria and also supplemented that with research from specialist agencies including rating agencies.
"Where we had conflicting information we looked into it ourselves."
The research was undertaken by five volunteers and himself working over six months.
Coates said many people were taking re-usable bags to the supermarket but when it came to their money they completely switched off.
"People have felt disempowered and have let the experts run it for them."
He also said low levels of financial literacy made it hard for people to analyse KiwiSaver data.
"They care about these issues but have haven't put these things together."
Coates said internationally there were a lot of big fund managers moving towards responsible investment.
"There is recognition this is important. But nobody has really told consumers."
He hoped that shedding a light on the industry would encourage some providers to change their investments but didn't expect all to pull out of the areas of concern.
"I think some people don't have the same values and don't care about the same issues. I think it is important to have a range of funds available.
"But people have to know what they are investing in."
The website also allows people to match their own beliefs to funds which have met certain standards.
"What we hope is that individual KiwiSaver funds will shift out of these kinds of companies and into ones with better environmental, social and governance standards."
Mindful Money would now look to expand its research platform internationally starting with Australia and hoped to launch research on managed funds that were outside of KiwiSaver by the end of the year.
