You are using an older browser version. Please use a supported version for the best MSN experience.

RBNZ super fund invested in cluster bombs

NZ Newswire logoNZ Newswire 1/09/2016

One of the Reserve Bank's staff super funds has been putting money into US companies that produce cluster bombs and says it's rushing to pull the investment out.

The central bank's Staff Superannuation and Provident Fund has indirectly invested in General Dynamics and Textron, two companies that may be involved in making cluster munitions, its chair Geoff Bascand said on Friday .

He said the fund - which is independent of the government and the RBNZ - had ended up buying into the companies through international index funds.

"The trustees have no control or influence over the individual stock selection in either of the passive or active funds," Mr Bascand said.

The situation had only been discovered in the last few days and staff were rushing to pull the investment out.

He said the RBNZ had also asked the fund to adopt a socially responsible investment policy at its next meeting.

However, the fund still indirectly retains investments in several cigarette and arms manufacturing companies on the NZ Superannuation fund exclusion list, including Philip Morris, Altria Group, British American Tobacco, Lockheed Martin and Honeywell International.

The announcement comes after several of the government's default Kiwisaver fund providers were found to be indirectly investing in companies that didn't meet the ethical criteria for public investment, through Australian fund manager Vanguard.

The government says those providers are private funds and are not subject to ethical investment rules placed on public funds.

Several providers have since announced they are divesting their indirect holdings into manufacturers linked to cluster munitions and landmines.

image beaconimage beaconimage beacon