BNZ has announced it will drop its investments in companies involved in the production of cluster munitions, anti-personnel mines, nuclear weapons and tobacco or tobacco products.
Its new responsible investment policy was announced on Thursday.
“In the last three-and-a-half years our funds under management have grown from $1.5 billion to almost $4 billion today, so we’ve undertaken a comprehensive review of our investment business,” BNZ head of wealth and private bank Donna Nicolof said.
In the past BNZ invested in commingled funds alongside other institutional investors.
“Our growth gives us the ability to leverage the scale across our wealth business to establish discrete mandates with investment managers, which gives us greater control of where and how our customers’ money is invested. This is a journey for us,” she said.
“We have been developing our approach to responsible investing over the past six months to ensure we have a robust framework where investment decisions align with both our investment beliefs and the changing attitudes of our investors and society.
“One of our key investment beliefs is that risk and return are equally important and we have made the decision to exclude companies involved in the manufacture of tobacco on the basis that there is no safe level of use and engagement with these companies is futile. The regulatory and litigation risks faced by this industry are significant.”
Nicolof said investment markets in New Zealand were maturing and ESG factors were becoming more important.
The policy affects all investments BNZ makes on behalf of customers, including in its KiwiSaver schemes.