Ethical Kate 2

Guest Blog – I recently changed my KiwiSaver to CareSaver

Kate Hall (aka Ethically Kate) 7 minute read

About the Author – I live and breathe sustainable living and ethical fashion. This alternative way of consuming and existing dominates my every waking moment- and sometimes more. Ethical fashion and living are no longer my hobbies, it has become my mission… to change the future of fast fashion and the way we consume. My husband and I strive to live a zero waste lifestyle, live at thrift stores, and always look to ‘up-cycle’ rather than throw out. Eco living is not a choice for me, it’s in my blood, and I am trying with all my power for it to be the new ‘norm’. 

I like to think I’m super on to it. I have diaries and lists, I read books and watch documentaries, I did really well in school and even better at university… but recently I let myself down. Up until early March 2020, I had no idea where my KiwiSaver was invested, or even what that meant.

To make it even more embarrassing, it turns out where you invest your money determines a huge part of your impact on people and planet. I have been ranting on about supporting ethical businesses and voting with your pocket since 2015, but little did I know the biggest vote I have was actually supporting businesses who are the exact opposite to my people-loving and planet-respecting values.

Put your hand up if you have no idea where your KiwiSaver is invested into, or even what I mean by that?

This was me just over a month ago, but my task right now is to ensure it won’t be you by the end of this blog post.

I recently changed my KiwiSaver to CareSaver; the most ethical KiwiSaver fund in New Zealand. It took 7 minutes, I love how they operate and all that they stand for, and it turns out their returns on investment generally exceed other KiwiSaver schemes.

What the heck is a KiwiSaver?

For those outside of New Zealand or newbies to the ‘adult’ world, a KiwiSaver is a voluntary saving scheme to help New Zealanders set up for their retirement. You may know it as a retirement fund or a ‘superannuation’. Simply put, it’s important to set aside a certain amount of money each week/month/year that ensures you have a cushion at the end of your life when you stop working.

But instead of placing this money in an arbitrary bank account until you need it, putting it into KiwiSaver means your money can

a) support businesses while it’s not being used by you

b) make you more money

A KiwiSaver is an investment fund. You’re investing in companies who will give you a return on your investment over time, while they use your money to make more money. Does that make sense?

The reason I mentioned that this is your biggest opportunity to vote with your pocket, is because your KiwiSaver should store thousands of dollars. Sure, it’s important to shop local, buy the bamboo toothbrush from the New Zealand owned company, and purchase that ethically made dress to vote for a fair fashion industry, but a KiwiSaver is worth THOUSANDS of ‘votes’. You’re investing A LOT into companies who will either do great or not-so-great things with it.

That’s why I recently made the switch to CareSaver so my money isn’t supporting things I disagree with. I feel a whole lot better about it.

What is CareSaver?

CareSaver is a KiwiSaver plan run by the team at Pathfinder Asset Management. They have managed ethical investments since 2010, and launched CareSaver in 2019.

CareSaver is New Zealand’s most ethical KiwiSaver fund.

After managing ethical investments for so long, they’ve come up with a system that means I know exactly where my money is going and can trust it’s making a positive difference.

Robust value system

CareSaver assesses and rates all companies on environmental, social and governance (ESG) metrics. These are their three main values, and they ensure every single company they invest in meets their criteria. CareSaver also use the UN Sustainable Development Goals as a blueprint for guiding their ethical investment decisions.

Companies causing environmental or social harm are avoided. Unlike many other KiwiSaver schemes, CareSaver does not invest your money in tobacco, factory farming, whaling, controversial weapons, fossil fuels, civilian weapons, inequality, animal testing, gambling, adult entertainment.

CareSaver also measures the carbon intensity of their portfolios and ensure they are 80% below the market (and dropping). They’re the only ones that measure carbon intensity, and they do this because they believe companies with a robust plan to manage climate risk are a lower risk investment – and of course, climate change poses a clear danger to the health of our planet and society (so let’s all avoid that).

NOTE: CareSaver gets carbon intensity by calculating a company’s yearly carbon emissions per 1mil of yearly revenue. This tells them how carbon-efficient they are. CareSaver can then compare that to a company’s peers in the same or similar industries and against the benchmark.

They give back

One thing I like most about CareSaver, is they have added a twist to how they utilise the fees that you pay them. As well as ensuring your money is working hard to support ethical business and make you positive returns, they have chosen to gift 20% of fees each year to 17 New Zealand charities (you can pick which charity your fees go to). I personally chose Forest and Bird, but there is a wide range of charities they’ve chosen that each has purpose, reach, and impact.

Gender representation

A company must have at least one woman on the board in order for CareSaver to consider investing in them. I know this seems like a small ratio, but I think it’s a brilliant beginning.

CareSaver actively voice this to companies who want to partner with them. This criteria has pushed companies without women in leadership to activate their own policies and strive for gender representation when it wasn’t previously on their radar! CareSaver is starting conversations around gender equality, in industries that have never considered it.

Super easy to use

I took a few weeks to get my head around KiwiSaver and CareSaver, and when I finally decided to switch from my ANZ KiwiSaver fund, I allocated 30 minutes to do this online. I was dreading the admin process.

Turns out, it took me 7 minutes to sign up online (including finding my IRD number and driver’s license) and a few emails later, it was done! Because I was with a previous KiwiSaver scheme and it had to be switched over, it wasn’t instant- but just 1.5 weeks after signing up online my first monthly payment was made.

I also really appreciate their online portal where I can see what is happening. I previously didn’t know where my KiwiSaver was because I couldn’t find the information easily online in my bank or IRD account. Now I have my own portal that shows how much money I have, what returns it’s making, and when payments have been made.

The fees are reasonable and average compared to other schemes too- read all about them here.

I personally felt sick when I realised I was investing thousands of dollars into companies that were exploiting the environment and people. It made my low waste and conscious lifestyle feel like a joke! If, like me, you want to ensure every cent is invested in companies doing good…

P.S. A great way to compare the ethics of all KiwiSaver Funds is through Mindful Money. You can find out what your current KiwiSaver scheme invests in here.

You can read Ethically Kate’s full article here

Kate also did a video showing her signup procedure, watch it here

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