Cluster bombs off super fund share list (New Zealand)
DROPPING cluster bomb companies and firms involved in simulated nuclear testing has all but cleared the decks of problematic investments for the New Zealand Superannuation Fund.
Fund chief executive Adrian Orr said yesterday that divesting the fund of such investments would result in its selling about $37 million of shares, or 0.3 per cent of its portfolio.
The NZ Super Fund has total investments worth $12 billion, down 20 per cent this year, because of the international sharemarket meltdown. The decrease in value in October alone was 13 per cent.
The fund will not sell its holdings in companies involved in making "delivery systems" such as rockets or guidance systems for nuclear weapons.
"I think we have got to the end of [divestment] on the Kiwi iconic issues," Mr Orr said, which meant selling out of companies involved in tobacco, land mines, whaling and now cluster bombs.
The Nuclear Free law in New Zealand was specifically about warheads and simulated testing, but ruled out delivery systems, which are legal.
Companies making those delivery systems also made "everyday products" that New Zealand consumers would use, such as Boeing planes. Another company, United Technologies, also made lifts and batteries.
The fund has never held shares in companies which make nuclear bombs but is excluding companies involved in simulated testing of such devices because they are critical to their manufacture.
The decision to sell out came after the New Zealand Government signed an international treaty with 93 countries to ban cluster bombs. There was also a comprehensive review of the nuclear weapons issue, Mr Orr said.
The treaty signing created a clear line for the super fund.
"It has drawn a very bright line: the government has signed the international treaty," he said.
"The manufacture or use of these weapons is now illegal, and goodbye." Dropping such companies was not expected to make much difference to the average expected return of the fund, Mr Orr said. In the fund's overall performance, "it would be lost in the noise", he said.
Typically, cluster bomb makers are part of much larger armaments and defence companies such as Raytheon and Lockheed Martin, commonly held by big international investment funds.
Von: 13.12.2008, by JAMES WEIR - The Dominion Post, www.stuff.co.nz