This is the third annual survey of New Zealand’s institutional investors by the Investor Group on Climate Change (IGCC), Centre for Sustainable Finance and Mindful Money. It shows the investment sector is not yet using its capital and its influence to drive the transition to net zero.

Climate-related risks to investment returns have become apparent as extreme weather, new technologies, changes in climate policy and consumer preferences disrupt businesses and their supply chains.

At the same time, huge opportunities are emerging. New Zealand’s Climate Change Commission estimates $34 billion of additional investment across key areas of the economy is required by 2035. Most of this funding will need to come from the private sector, potentially creating attractive investment opportunities.

Yet the 2023 survey of the investment sector shows slow progress in climate action taken over the past year, suggesting a lack of urgency. New Zealand’s managers of investment funds and institutional owners of financial assets continue to lag their counterparts in Australia and the EU.

Key Findings of Respondents

• 30% had a strategy or plan for achieving their net zero objectives or targets. An additional 54% intended to produce one over the next twelve months,
• 77% had policies regarding fossil fuels,  
• 100% used negative screening for some climate goals,  
• 92% used corporate engagement, shareholder action and/or active ownership,
• 26% had a formal target, plan, commitment and or strategy for investments in climate solutions (public or non-public),
• 8% had assessed their entire portfolio for exposure to physical risk associated with climate change. When assessments were made, a high proportion of investors responded to the information; primarily by implementing negative screens (54%).