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Update on Climate Change Reparations from COP27

In the November newsletter, we raised the issue of Climate change and the compensation question. Surprisingly an agreement WAS made about compensation at COP27, heralded as a landmark moment in global climate politics.The agreement (adopted without a single objection) acknowledges that the emissions created by richer nations are responsible for the damage that results from the higher temperatures. As we outlined in November, New Zealand had already committed $20m and smaller pacific and isl...

2022 Rotary Cambridge Garden Festival - a great success

Since 2018, Moneyworks has been a premier sponsor of the Rotary Cambridge Garden Festival, and Carey has been the organiser and main volunteer.  Built from scratch in 2018, the 2019 Garden Festival was a great success, 2020 was Covid cancelled, and 2021 was Covid cancelled (3 weeks before the event, but still raised over $15,000 from kind donations of the ticket purchases).The 2022 Garden Festival was held on Sunday 20th November, amidst rain and thunderstorms, but the 1,500 ticket purchase...

Holiday Hours and Festive Season Greetings

As usual, Moneyworks will be closing down over the Festive Season as follows: Office closes: Thursday 22nd December 2022 Office re-opens: Monday 9th January 2023 Not all of our team will be available during January, but they will have their out of office on, with instructions on how to get an answer to your query. We will be monitoring our emails every now and then if you have an urgent situation (ie an insurance claim). We wish all our clients and colleagues a fantastic festive season and safe ...

Trauma Insurance - it does work - but definitions are vital

Trauma insurance (or critical care, serious care insurance depending on your provider) is part of the suite of personal insurances that Moneyworks recommends to our clients.  We have used trauma insurance since day one (14/02/1997) and have seen our clients receive many payouts, mainly for heart and cancer related conditions. Trauma insurance is a 'living insurance', like income protection insurance, which pays out while you are alive.  Life insurance covers expenses and provides ...

House insurance premiums are increasing - find out why

2022 renewals for house insurance premiums are the biggest increases for many years, but it is important that you have full cover in place so that you aren't facing a large shortfall if you need to claim. [For more articles on house insurance, go to our blog and search for house insurance].There are a number of reasons that premiums have increased this year, we will step through them.1. EQC (Government Earthquake Commission Levy). From 1st October 2022, the coverage has doubled from $150,00...

Climate change and the compensation question

With thanks to the Financial Times Moral Money Newsletter (quotes in italics) While I can't replicate this commentary in full, (which I wish I could), there were significant points made in this article that I felt were worth sharing.  I have added my own commentary and words. The latest climate change conference is being held in Egypt (the 27th conference) as I write this.  The impact of climate change is starkly evidenced in developing countries, while the causes of climate change (c...

Collaborative Engagement - NZ Super Fund and The Christchurch Call

Achieving change in the world can be slow, and we have seen NGO's, lobbyists (for better or worse) and protestors achieve change.  But investors have the power to achieve quite a lot of change, particularly by joining together to address issues.  This is 'active engagement' which is a key part of ethical investing.Formal collaborative engagement frameworks exist under the UN PRI (Principles for Responsible Investment) and other global and national groups, but collaborative engagem...

Building our clients portfolios

At the end of September 2022, Carey was on a panel at the RIAA (Responsible Investment Association of Australasia) conference, talking about how we build our clients portfolios.This is an area that we have spent a lot of time on over the last two years, and are continuing to develop and streamline, so we thought it would be a good idea to give you some idea of the work that we put in.We start off with our three different portfolios Base (for existing clients only who wish to stay in this no...

A sea of red?

That was the title of an email that I received from a client recently, referring to the latest fall in the sharemarkets.  They are correct, it is a sea of red, but there are some really important things to understand. Market Cycles Markets (actually pretty much everything in the world) move in cycles.  It is generally thought that the financial markets move in a 7 year cycle, with expectations that they will 'correct' every 7 years.  The last time we had a major correction was in ...

What are our emotional biases and how do they impact our investing?

Firstly, really look at the cartoon above.  While it is funny, it is also quite true and illustrates how emotions can get in the way of investing.  This cartoon can illustrate a number of biases - recency bias, fear of missing out, anchoring effect.In the last article we looked at the five main behavioural finance biases - Confirmation bias, Recency bias, Gamblers fallacy, Anchoring effect and the Herding effect.This final article in the series looks at five main emotional biases ...

Just a little bit proud... to be a B Corp

A little bit proud...  Actually... really proud and excited.Moneyworks is the first financial adviser in New Zealand to receive a B Corp Certification - recognising our commitment to doing business for good.It has taken us six months to complete the assessment process and gain certification, but that is a little misleading as it would have been very difficult if we hadn't spent the previous two years developing our systems, processes and policies to achieve our Financial Adviser Practice li...

Investing in sustainable packaging (and getting rid of those pesky plastics)

In late 2019 we went on a cycling holiday of Borneo (which was quite an adventure and fascinating) and started off staying at a resort in Kota Kinabalu.  It was a lovely resort on the beach.  Every day the beach was scoured for plastic rubbish (the beach looked out on the South China Sea and the Gulf of Thailand), with sacks of rubbish being collected. But within hours more rubbish accumulated.  This really brought home to us the problem of plastic pollution around the world and a...

What is an investors cognitive bias?

The classic economic theory (which relates to investing) works on the basis that 1. Everyone is rational (investors and markets) 2. Investors have perfect self control 3. Investors aren't confused by any 'emotional' factors in the way that they think and reason 4. Investors process information efficiently. This would work well if all investors and markets were robots, but it isn't true in reality.   In real life, investors are normal people with emotions, have limits on their self cont...

Why do investors do what they do?

Looking at the picture above, you might feel a ring of familiarity about your emotions if you are watching your investments on a regular basis.  This is particularly relevant when we look at what has happened in markets since the start of 2020. Markets went up and up from 1st January 2020 until mid February.  They then started drifting down and came down with a big thump in mid March - the Covid Crisis.  Usually, markets then take time to recover slowly, like in this picture....

Retirement Village living - in's and out's

We recently participated in an online webinar through our industry body, where representatives from the Retirement Villages Residents Association of New Zealand were talking about buying into and living in Retirement Villages. You can find information about them by clicking here https://www.rvranz.org.nz/. 48,000 people live in 450 Retirement Villages around New Zealand and in the next 11 years it is expected that there will be an additional 34,000 residents in 80 new villages.  There are 3...

ESG ratings businesses - how robust are they really?

Sometimes, with all the information available it be hard to remember that the ethical/sustainable investing industry is still in its infancy. We have written before in these blogs about how an analysis by Alphinity of the ESG ratings from different providers had little co-relation.  In a recently published report, the UK Financial Regulator (Financial Conduct Authority - FCA) have said that there is a 'clear rationale' for it to regulate the leading ESG ratings and data firms (MSCI, Su...

Shareholder Resolutions and Activist Investing

Resolutions are decisions about companies that need to be made by the owners (the shareholders).  While there are different laws in each country, there are generally two types of resolutions - General/Ordinary and Special (which require a higher percentage of votes from shareholders to pass).A resolution is usually proposed by the company and deal with things like voting on who will constitute the Board of Directors, and on Executive Remuneration.  However, Shareholders can propos...

How your Fund Managers vote is important

Moneyworks recommends fund managers to you.  You then entrust your money to those fund managers to exercise their votes and use what power they have to ensure that the company they are investing in is successful (both financially and ethically - if that is a feature of the fund). This article is an overview of the issues and over time we will provide more information.Gone are the days where a fund manager can turn up to a shareholders meeting to cast their vote in person.  Fund Ma...

Mindful Money Ethical Investing Awards 2022

Mindful Money has operated as a charitable trust since 2019 with the goals of increasing awareness of ethical investing in New Zealand.  They do this in a number of ways, the key at this stage is through the free to access consumer website at www.mindfulmoney.nz, and they are building on this by targetting influencers.  The Mindful Money Awards and Conference were launched in 2021 as a cornerstone platform for this education and recognise leaders in KiwiSaver, retail funds management, ...

So - what is this Bear Market Thing?

This is an abbreviated article, based on information sent to Moneyworks investment and membership clients on 16th June 2022. Listening to the news in the last few weeks can be unsettling if you haven’t been through a market downturn before.  And many of our clients haven’t, as the last major downturn was from 2007-2009 (Not including the brief Covid Crisis in March 2020 where markets bounced back far more rapidly than most people expected). It can be unsettling even if you have been thr...

Ethical Investing is not a formula

Ethical Investing is trendy. (Or ESG, Sustainable, Responsible - call it what you like). Billions of dollars have flowed into ethical branded investments over the last three years and projections are that billions more will in the forthcoming years. Multi billion dollar industries have been created around the trend, with organisations flouting their ESG, Ethical, Responsible, Sustainable characteristics. Hundreds of indices have been created, investment research products and measures have been d...

Making your donations work harder for you

We Kiwis are a generous lot, we donate money to help people and animals who are having a difficult time for any number of reasons.   Donating is financially viable for many people because of the tax rebate that they receive - the rebates are not limited as long as the donations are reasonable.  IRD shows that in 2019 the average person claimed back $746.90 in donation rebates - of course that is probably skewed by some pretty big donors, but it shows that we are generous. But now,...

Whats the deal with Genetic Modification being a 'nasty' in New Zealand?

The MIndful Money consumer surveys which identify 'nasties' - consistently shows that Kiwi's are resistant to investing in GMO's, or Genetically Modified and Genetically Edited organisms.  But why?  There has been quite a bit of commentary recently about how old the New Zealand genetic modification regulations are - (A 1996 Hazardous Substances and New Organisms Act, and a quick google brings up a 2004 Ministry for the Environment Paper in the first entries).   This is in res...

Barriers to Ethical Investing

Greenwashing involves labelling a product (whether it is something you eat or use around your home, or an investment of KiwiSaver fund) to be 'green', 'ethical', sustainable or responsible, when it really isn't when you look under the hood.To work out whether your KiwiSaver or investment actually is true to label would require looking at the actual investments held and undertaking a thorough analysis of the policies and processes that each fund manager uses. The independent information available...

What do New Zealanders want to avoid in their investing?

Since the last survey, the survey authors have refined the categories of 'nasties', breaking them down into more detail.Instead of a catch all of 'Human Right Violations or Environmental Damage', we can now see that people don't want a range of Human Rights related violations as follows:Human Rights Violations (90%)Labour Rights Abuses (89%)Violations of the rights of indigenous peoples (87%)Social media companies that breach privacy standards (83%)Animal testing for non-medical purposes is not ...