NZ Superannuation Fund excludes four firms from portfolio
Wednesday, 26 September 2012 11:55am

New Zealand Superannuation Fund has excluded four companies from its $19 billion investment portfolio, following severe breaches of its responsible investment standards.

The firms that were excluded from the fund's portfolio include Freeport-McMoRan, KBR, Tokyo Electric Power Company and Zijin Mining Group.

NZ Superannuation Fund said this decision were based on information from its specialist screening agency which identified where the companies had breached global standards of good corporate behaviour such as the UN Global Compact.

In addition, the fund also draws on information from other sources including similar funds overseas.

"In making a decision to exclude a company from our portfolio, one of the tests we apply is whether engagement with the company might realistically lead to sufficient improvements," said Anne-Maree O'Connor, manager responsible investment at NZ Superannuation Fund.

"We have come to the conclusion that further engagement by the fund with these companies is not likely to be effective. We would rather focus our efforts on companies where we believe we can make a difference," she added.

The NZ Superannuation Fund's responsible investment standards are set out in its responsible investment framework.

Under this framework the United Nations Global Compact is the key benchmark against which the Fund measures corporate behaviour.

The fund's global equity portfolio, includes shares in more than 6,500 companies around the world, and tracks global equity indices including the MSCI large-cap equity index, the MSCI emerging market index and the MSCI small-cap index.

The portfolio is monitored for compliance with exclusions applied to the fund on a daily basis.

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