Our investment beliefs underpin our investment decisions. One of our investment beliefs is: "Responsible Investment encompasses not only maximising return for risk, but also acting in accordance with broadly accepted global standards of ethical conduct in relation to business governance, environmental and social risks." We interpret fiduciary duty as maximising the financial interests of scheme members and the NZ Government as guarantor of pensions. We also have a statutory duty to "avoid prejudice to NZ's reputation as a responsible member of the world community". This means portfolio optimality may be sacrificed to avoid or limit prejudicial investments. The Authority does not invest in entities acting contrary to NZ's laws or international agreements nor tobacco investments. As a member of the UNPRI we collaborate with other investors to with companies that breach our ESG standards and exclude those that do not respond adequately. Our external managers are expected to consider ESG factors when investing and comply with our policies.
Our approach to Responsible Investment (RI) is governed by our Statement of Investment Policies, Standards and Procedures (SIPSP). The SIPSP refers to ESG integration , voting , engagement and exclusions.