Invest for the planet - and for your future
Sponsored by AMP Image / Supplied. Sponsored by AMP AMP took a bold move in 2021 by pivoting to a sustainable investment philosophy across its AMP KiwiSaver and pension funds, supporting its range of corporate sustainability initiatives. Sustainable investing is more than just words. Its walking the talk. Its making climate-positive decisions at the same time as boosting the value of customers KiwiSaver and other investments, says Aaron Klee, General Manager of Investment Management & Services at AMP New Zealand. The world is changing and so did AMP after consulting with customers replacing traditional fund management with a new approach with sustainable investing at its core. It also commenced a net-zero climate strategy. We manage our KiwiSaver and other funds on behalf of everyday kiwis and our customer research showed that sustainable investing was really important to them, says Klee. When AMPs analysts modelled sustainable approaches against the previous nine years of investing history, they found the sustainable portfolios would have outperformed a traditional portfolio over that period. With the customers opinions and the modelling in, AMP brought its fund management back in-house and revised its philosophy to: Support the good Avoid the bad Reduce carbon footprint and Advocate for change AMP turned investing on its head, seeking advice, tools, data and services from world investment leaders like BlackRock, and switching from active to index investing, says Klee. While many competitors choose vanilla passive funds, AMP customised several of its indexes to align to its sustainable investment philosophy. AMP then rebuilt its funds excluding companies that dont meet its sustainability criteria and increasing its exposure to companies with better sustainability attributes. Investing sustainably isnt just about doing the right thing. Research shows that sustainable investing brings better returns for customers particularly in relation to the projected future impacts from climate change, says Klee: Put simply, why do you want to own what the world wants to move away from, like fossil fuels? We want to own the things that the world wants in the future. Its basic economics, he says, and the new philosophy and sustainable framework came with a bonus: it saw KiwiSaver fees drop by 20 - 40 per cent on AMP funds within the AMP KiwiSaver Scheme. Livvy Mortimer, Sustainable Investing Analyst at AMP, says as part of AMPs philosophy the fund manager has committed to being a leader on climate change issues and is working to align its operations and investment funds with the 1.5-degree warming target set by the Paris Accord. AMP now has the most funds across both Australia and New Zealand by a single provider with products certified as being responsible by the Responsible Investment Association Australasia, Mortimer says. AMP has also become the first New Zealand financial services company to commit to setting emissions reduction targets to meet the Science Based Targets initiative (SBTi), which further validates its approach. AMP has committed to transparency and publishes its portfolios holdings, exclusions criteria and detailed methodology on its website for customers to see. It also publishes a quarterly Sustainable Investment Report that tracks progress on all its key metrics and targets. For more information: www.amp.co.nz .