Insights
Important information about our advertising and disclosure

Pathfinder has received a censure from the Financial Markets Authority (FMA) under the Financial Markets Conduct Act 2013 (FMCA) in respect of two digital ads. Pathfinder has cooperated with the FMA’s inquiries and accepted the censure.

One ad ran on social media and the other on our website. These featured two Pathfinder KiwiSaver Plan members sharing their views on why they chose us as their KiwiSaver provider, which represented that our Funds did not invest in companies involved with fossil fuels or animal testing.

The FMA found that the two digital ads were misleading as they should have been qualified with information about our investment process and, in particular the exceptions related to animal testing and fossil fuels we held at the time the ads were running. These exceptions were made in accordance with our Ethical Investment Policy.

Once we became aware of the FMA's concerns, we promptly took down the ads. In addition, we now have more detailed information about our ethical investment process on our website and blogs.

We only grant exceptions in exceptional circumstances where one of the following strict conditions applies:

Transition: A company may be in the final stages of a transition out of an excluded activity, or intentionally take on other’s environmental liabilities to transition them out of an excluded activity, with a clear pathway to achieving that.

Transformation: A company may be striving to change an industry or process such that it transforms out of being an excluded activity.

Financial: Our Investment Team may determine we are unable to create a portfolio with appropriate diversification and/or risk & return characteristics without that company.

As of today, we’ve granted 6 companies an exception. In terms of scale, depending on the KiwiSaver fund, our investment in these is between 0.8% and 4.6% of the Fund’s value.

The only Fossil Fuel exception is Contact Energy, which is transitioning out of electricity generation from coal. According to their Sustainability Report, they generated 90% renewable power in the 2023 financial year. They expect their generation portfolio to be more than 95% renewable by 2027. An example of a company that’s been granted an exception for animal testing for medical purposes is Polynovo - a producer of synthetic skin for medical purposes, that, if successful, will result in a much lower future (medical) demand for animal-sourced surgical products.

Notably, the FMA has not censured us for acting in breach of our Ethical Investment Policy, rather they are highlighting a failure to qualify the two advertisements with information about our exceptions at the time the advertisements were running. For failing to do this, we apologise and accept the censure.

Ethical investing isn’t simple, it’s a process we committed to well before we launched our KiwiSaver plan. As we continue to learn and grow, we will continue to find ways to help investors align their KiwiSaver with their values. Our vision and mission have not changed. We seek to avoid investing in companies that cause harm to our people, planet and animals while delivering good returns for our members.

You can find full details on our exclusions and exceptions to those exclusions in our Ethical Investment Policy and in our Exceptions Register.

For greater detail on our position on animal testing and investing, you can read our blog here.
And for greater detail on our position on fossil fuels and investing, you can read our blog here.

To read the censure, click here