New Zealand Superannuation Fund

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New Zealand Superannuation Fund
Company typeState-owned
IndustryInstitutional investment (sovereign wealth fund)
Founded2001; 23 years ago (2001)
FounderMichael Cullen
Headquarters
Auckland
,
New Zealand
Key people
  • Nicola Willis - Minister of Finance
  • John Williamson - Chair of the Board
  • Paula Steed - Chief Executive Officer (Acting)
  • Stephen Gilmore - Chief Investment Officer
Parent
Guardians of New Zealand Superannuation[3]
Subsidiaries
  • CNI Timber Operating Company[4]
  • NZSF Aotea[5]
Websitewww.nzsuperfund.nz

The New Zealand Superannuation Fund (

superannuation for people over 65 years of age and the purpose of the Fund is to partially pre-fund the future cost of the New Zealand Superannuation pension, which is expected to increase as a result of New Zealand's ageing population. The fund is a member of the International Forum of Sovereign Wealth Funds and is therefore signed up to the Santiago Principles on best practice in managing sovereign wealth funds.[6]

Foundation

The Superannuation Fund was created by the New Zealand Superannuation and Retirement Act 2001[7] on 11 October 2001 by Michael Cullen, who was then Minister of Finance under the Fifth Labour Government, and is colloquially known as the "Cullen Fund".[8]

The sovereign fund posted a record 25.8% return in the twelve months till 30 June 2013.[9] In the 2009 New Zealand budget the National Government suspended payments to the fund.[10] Contributions were proposed to resume in 2020/21 when the Government's net debt to GDP was forecast to fall below 20% again.[11] Instead, the new Labour-led government started payments into the superfund again in December 2017.[12] The New Zealand Government had contributed $21.8 b to the fund as at 31 March 2022.[13]

NZ Super Fund announced a preferred partner agreement with the Māori Investment Fund in March 2018.[14]

Investments

A full list of investments for current and previous years can be seen at the Annual Equity Listing page at the NZ Super Fund's website.

LanzaTech

The Fund invested US$60 million into Chicago based LanzaTech in December 2014. On March 8, 2022, LanzaTech announced its initial public offering through a special-purpose acquisition company in a deal that valued the company at $2.2 billion.[15]

View | Dynamic Glass

During August 2015, The New Zealand Superannuation invested US$75 million into American-based

electrochromic glass company View with a percentage owned not being released.[16]

Kaingaroa Timberlands Partnership

On Feb, 28th 2014, The Fund sold 2.5% of its stake in the Kaingaroa Timberlands Partnership to the Kakano Investment Limited Partnership, reducing its share from 41.25% to a 38.75% stake in the Kaingaroa partnership.

Other Investments

Other investments include a 7,943,351 share (0.71%) stake in partially state-owned and controlled (51.95% - state-owned portion) company Air New Zealand.[17] The Super Fund also holds a 37.59% stake in Datacom Group.[18] The Fund occasionally cooperates with outside companies to develop projects.[19]

Exclusions

The Superfund maintains a list of excluded companies similar to the Government Pension Fund of Norway.[20] The Superfund will not invest in the companies within the list.

The list includes,

  • Companies in the tobacco industry;
  • Companies involved in the production of
    anti-personnel mines
    ;
  • Companies involved in the Grasberg mine in West Papua;
  • Companies involved in the processing of whale meat;
  • Tokyo Electric Power Company;
  • Companies involved in developing settlements in the Israeli-occupied territories;
  • Companies involved in the manufacture of civilian automatic and semi-automatic firearms.[21]

Controversies

Banco Espirito Santo

In February 2015 the Superfund wrote off a $150 million loss in a

Bank of Portugal to recover the lost money.[23]

Divestment

The Superfund's investment portfolio is the subject of ongoing debate. Labour Party MP

Israeli Defence Force as a weapon.[24]

In February 2015 Green Party MP Russel Norman called for the Superfund to divest $676 million from fossil fuel companies.[25]

In August 2017 the Superfund quit or reduced holdings in 300 fossil fuel companies, making 40% of all Superfund investments

Statoil, New Zealand Oil & Gas, Genesis Energy, Alliant Energy, Berkshire Hathaway, Chevron, Rio Tinto, ConocoPhillips, Mitsubishi and Occidental Petroleum. Chief investment officer Matt Whineray stated, "We think that climate change represents a material risk, one that is not being properly priced by the markets."[26]

Fossil fuel divestment campaign organisation 350.org Aotearoa had been campaigning for the New Zealand Superfund to divest from fossil fuels for one year.[27] 350 Aotearoa and Greenpeace Aotearoa New Zealand supported the decision, calling it a "turning point for New Zealand."[28]

References

  1. ^ https://ar2018.nzsuperfund.nz/[dead link]
  2. ^ https://nzsuperfund.nz/
  3. ^ "Guardians of New Zealand Superannuation: Governance and management of the New Zealand Superannuation Fund – Office of the Auditor-General New Zealand". Retrieved 2 December 2016.
  4. ^ "Shareholdings".
  5. ^ "Shareholdings". Retrieved 2 December 2016.
  6. ^ International Forum of Sovereign Wealth Funds. "IFSWF Our members". Archived from the original on 27 September 2016. Retrieved 24 September 2016.
  7. ^ "New Zealand Superannuation and Retirement Income Act 2001". 7 July 2010. Retrieved 12 May 2011.
  8. ^ "National's KiwiSaver and "Cullen Fund" policies". Chapman Tripp. 13 November 2008. Retrieved 12 May 2011.
  9. ^ "New Zealand Superannuation Fund Posts Record 25.8% Return for 2012-2013". Sovereign Wealth Fund Institute. Retrieved 3 September 2014.
  10. ^ "CONTRIBUTIONS SUSPENSION", nzsuperfund.co.nz/
  11. ^ "Budget 2015 - Fiscal Strategy Report" (PDF). 21 May 2015. Archived from the original (PDF) on 22 May 2015.
  12. ^ "Jacinda Ardern and Grant Robertson restart Super Fund payments". 15 December 2017. Retrieved 9 May 2018.
  13. ^ "NZ Super Fund Story". NZ Super Fund. 10 May 2022. Retrieved 10 May 2022.
  14. ^ "Te Pūia Tāpapa Fund and NZ Super Fund commit to preferred partner relationship". NZ Super Fund (Press release). 13 March 2018. Retrieved 15 December 2022.
  15. ISSN 0099-9660
    . Retrieved 17 March 2022.
  16. ^ "NZ Super Fund invests in US smart glass company". 13 August 2015. Retrieved 2 December 2016.
  17. ^ "Shareholdings".
  18. ^ "Shareholdings". Retrieved 2 December 2016.
  19. ^ "New Zealand Sovereign Wealth Fund Forms Offshore Wind Partnership with CIP". Offshore Wind. 29 March 2022.
  20. ^ "Companies excluded from the New Zealand Superannuation Fund as at 26 September 2014", nzsuperfund.co.nz/
  21. ^ "Automatic and semi-automatic weapon ban for NZ Super Fund". 12 April 2019.
  22. ^ "NZ Super Fund loses $200m after 'risk free' loan to Portuguese bank". The New Zealand Herald. 19 February 2015. Retrieved 23 March 2015.
  23. ^ "Super Fund confirms Portugal bank legal case". The New Zealand Herald. 27 February 2015. Retrieved 23 March 2015.
  24. ^ "NZ Super Fund has deadly portfolio". Sunday Star-Times. 3 August 2014. Retrieved 23 March 2015.
  25. ^ "Greens want NZ Super Fund to drop fossil fuels". Stuff.co.nz. 13 February 2015. Retrieved 23 March 2015.
  26. ^ "Superfund Sells Shares to Cut Climate Change Exposure". Radio-NZ. 15 August 2017. Retrieved 20 September 2017.
  27. ^ "Superfund Divestment shows real climate leadership". scoop.co.nz. 15 August 2017. Retrieved 20 September 2017.
  28. ^ "Super Fund's $950m fossil fuel divestment an "aha" moment for NZ economy". greenpeace.org/new-zealand/en. 15 August 2017. Retrieved 20 September 2017.

External links

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