Māori asset owners prioritise sustainable investments
New Zealand’s Māori asset owners emphasised their nature-guided investment philosophies as recent storm damage across the country highlights the importance of aligning infrastructural development with climate change considerations.
The Māori and Pasifika populations consider themselves to be “people of the land,” who relate on personal terms and through ancestral lineage to the mountains, land and rivers, as well as the ecosystems and species present.
As reported, tribal communities in New Zealand, known as iwi, tend to have a strong home bias, investing in traditional areas for New Zealand asset owners as well as commercial property, housing, agriculture and forestry.
Iwi groups such as Ngāti Toa, Raukawa, and Waikato-Tainui have environmental management plans in place in the effort to improve their environmental impact.
According to the Ngāti Whātua Ōrākei iwi, “Our mātāpono [values, beliefs] guide us in all that we do as a business. In particular, kaitiakitanga [guardianship] and rangatiratanga [self-determination] inform our commitment to identifying and proactively managing climate and environmental related risks.”
WALKING THE TALK
Most iwi have evolved their commercial operations to make them more sustainable.
They also report on these aspects. For example, while the Ngāi Tahu iwi investment scheme is not legally required to report using recommendations under the global Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD), they have chosen to do so as a show of commitment to making a positive contribution to the global climate challenge.
A climate change working group, comprised of representatives of the different entities in Ngāti Whātua Ōrākei, was established during 2022.
It developed a Foundational Climate Position statement, aiming to be net zero across all operations by 2030 and aspiring to draw down more emissions than it produces.
As various iwi are wont to make clear, this commitment to the land and the water dates back before ESG became fashionable in a western sense.
“This goes back long before Pakeha (New Zealanders of European descent) marketing cottoned onto it,” Aaron Hing, investment committee member of Tūhoe iwi, told AsianInvestor. “We go back generations of caring for the environment, because it’s the environment that we live in.”
Hing appreciates that mainstream investment offerings can now provide ESG exposure “so that you can invest without compromise and invest expertly. Tūhoe is certainly one that has gravitated towards the quality offerings available.”
A key part of Tūhoe's selection of external fund managers Harbour Asset Management and Salt Funds Management was their ability to walk the talk, as Hing said. “They had a pedigree in ESG and that is certainly an expectation of how they will invest for us.
COMMUNITY RESPONSIBILITY
With iwi, community is in the foreground. Tūhoe’s focus is how can it improve the health and well-being of its people today while ensuring a positive legacy for the next generation.
“Our objective is to find the investment program that can produce decent real returns, but which also has the ability to produce the cashflow needed to build infrastructure within the iwi,” said Hing.
This last objective has become even more critical since disastrous floods and landslips occurred in New Zealand’s North Island in recent weeks.
Raukawa, another iwi affected by the recent storms, has its own environmental teams and operates a rigorous approach across governance, environmental management and reporting.
RIDL, the commercial arm of the iwi, understands absolutely its responsibilities in this regard, according to Jon Stokes, Raukawa iwi member and director of RIDL. It invests with a long-term view and will only buy assets that accord with its values
The entity believes in comprehensive research and in seeking out assets that are best performing not just commercially but in social and environmentally appropriate ways.
“Raukawa understand very deeply our responsibilities to our next generations,” Stokes told AsianInvestor.
As well as its core focus on the environmental aspects, RIDL also assesses factors beyond standard ESG, such as industrial relations and adherence to cultural values.
“In relation to financial assets, we review fund managers’ holdings guided by these factors, and have this independently re-assessed every six months.”
Stokes added that the team was unlikely to work with those who do not embrace mana whenua, which translates to the power associated with possession and occupation of tribal land.
The tribe's history and legends are based in the lands they have occupied over generations and the sustenance that land has provided for the people.
“We would be highly unlikely to invest in or work with partners that don’t appreciate the expectations of mana whenua, and understand the benefits that come from working with those who have a deep generational connection to the whenua,” said Stokes.