An official of the Palestine Solidarity Network Aotearoa (PSNA) praised this month’s High Court judicial ruling over New Zealand Superfund “unreasonable and unlawful” investment policies towards Israeli companies — but warned that the fund management would need to shape up.

Speaking at the PSNA rally at Te Komititanga Square today in week 133 of protests over Israeli genocide in Gaza, national secretary Neil Scott also gave a verbal bouquet to all the activists and lawyers who had achieved the victory after a 20-year struggle.

He named Phil McNeale as one of the activists who began pushing for the Superfund to divest from Israeli companies funding illegal settlements in the Occupied West Bank about two decades ago.

• READ MORE:  PSNA says High Court Superfund decision a victory for Palestinian rights
• NZ’s $86 billion Super Fund failed to properly address human rights, court rules in Palestine case
• The High Court ruling on the NZ Superfund policies
• Other PSNA reports on Palestine

PSNA earlier issued a statement declaring that this was an “important and timely win for Palestine” and expressed confidence that the Superfund would “quickly divest from the four companies [where] it holds investments” which were on the UN Human Rights Council list involved in building and maintaining illegal Israeli settlements.

Scott recalled that during 2020 and 2021, PSNA had called on the Superfund chief executive Matt Whineray to divest from Israeli banks.

“We know Israel cannot build the illegal colonies in the West bank without bank funding,” he said.

“Essentially, our NZ Superfund was investing in funding war crimes. On our behalf.”

‘Shameful policy’
On each communication about the “shameful” policy, Whineray had rejected the PSNA protest.

“In 2021, PSNA got a King’s Counsel (KC) lawyer to review the investments in Israeli banks and then sent a letter to then Minister of Finance Grant Robertson setting out the legal opinion,” Scott said.

“Robertson refused to respond to us. But soon after, the Superfund divested from four Israeli banks. Yes, we won then.”

However, Scott said that in 2021, just after the divestment decision, the Israeli Institute was “all over the Superfund with a flood of OIA requests — six of them”.

“A bunch of private individual OIA requests also went in,” Scott said.

“Usually, the Superfund received about 3 or 4 OIA requests a year. In 2021, it received 11.

“So, it seems as if massive pressure was put on the NZ Superfund to change its policies on ethical investments — to benefit Zionist Israel.

‘Gutting ethical investment’
“In 2022, it did just that. Gutting the ethical investment policies so that even investments in Israeli banks wouldn’t have been excluded.”

Scott said the Superfund dropped any reference to the “UN Global Compact” and the “Principles for Responsible Investment” — two of the main ethical investment policies in the world.

“It did this, sliding the changes through in the shadows without letting anyone know. Just slid it through in the shadows.”

PSNA kept on calling the Superfund to divest from the UN Divestment list. However, the Superfund responded by claiming that the companies cited “did not meet their, now secret, threshold”.

Late in 2024, PSNA decided to call for a judicial review of the Superfund’s investment in four companies.

“We briefed two KCs on the call. They agreed that it would have a good chance of winning,” Scott said.

“During the process of discovery, the KCs found that the Superfund had secretly changed its ethical investment policies during 2022.”

Who is responsible?
Scott said the PSNA was now determined to find out who were responsible for changing the ethical investment policies for the “benefit of a foreign country”.

He named a minister, chair of the board and the chief executive at the time of the change, saying that as a result of the High Court ruling, the Superfund “has a duty to reformulate the policy documents consistently with the [NZ Superannuation and Retirement Income Act 2001]”.

Scott praised the team responsible for winning the case: PSNA co-chair John Minto; co-chair Maher Nazzal, a Palestinian; Palestinian Rawaa Elhanafy; Rodney Harrison KC (who wrote the original letter to then minister Robertson in 2021); Francis Joychild KC; and B A Mugisho.

He also gave a final message to the cheering protest crowd: “A word of advice to everyone in the management of the Superfund — Aotearoa is our country. Not racist, ethnic cleansing, land thieving genocidal Zionist Israel.

“You work for Aotearoa. Do your job.”

May Day ‘Stop war’ rally
Among other speakers at the protest, Stop Wars Aotearoa organiser Joe Carolan appealed for support at next Friday’s May Day “Stop the fuel crisis and stop the war” rally at 6pm at Karanga-a-Hape Station.

“High fuel prices are driving workers reliant on cars off the roads. Our rightwing coalition government rules for the rich and doesn’t feel the pain of the cost of living crisis. We need solutions, not excuses,” Carolan said.

“The Solution: Free, frequent public transport for all, funded by taxes on the oil companies and the super rich.”

The Stop Wars Aotearoa coalition is demanding:

• Immediate free transport as a climate and cost-of-living solution;
• Permanent, 24 hr, frequent and fare-free transit for all, paid for by taxing corporations and billionaires; and
• Prioritised fuel for essential services, not luxury, while transitioning to renewables. New green jobs in a massive expansion of public transport and rail.

The managers of the New Zealand’s $86 billion Super Fund failed to properly address human rights issues when considering whether to exclude companies from its investments, the High Court has found

Justice Simon Mount granted an application by the Palestine Solidarity Network Aotearoa (PSNA) for judicial review of Guardians of New Zealand Superannuation’s policies relating to ethical investment.

In a decision released today, Justice Mount declared parts of the fund’s policy documents, standards and procedures, and its sustainable investment framework were “unreasonable and unlawful”.

• READ MORE: Illegal Israeli settlers kill Palestinian during raid on occupied West Bank village
  
• How Israel’s record budget will finance expanding illegal settlements
• Other PSNA Super Fund reports

The court also ordered the crown entity to pay PSNA’s legal costs.

PSNA co-chair John Minto said the decision was a victory for Palestinian rights, while Guardians of New Zealand Superannuation said it was considering its next move.

The sovereign wealth fund was created in 2001 to help provide for New Zealander’s superannuation costs.

By law, Guardians are required to invest the funds on a prudent commercial basis, manage and administer the fund with best-practice portfolio management, and avoid prejudice to New Zealand’s reputation as “a responsible member of the world community”.

Backbone of case
That last duty formed the backbone of the case taken by PSNA, who have long lobbied the Guardians to divest from companies it claims to be complicit in human rights abuses in the occupied Palestinian territories.

The Guardians excluded development, construction and technology companies involved in settlements in the Occupied Palestinian Territories in 2012.

In 2021, following years of lobbying by PSNA, the Guardians also excluded five Israeli banks from its portfolio on the grounds there was an unacceptable risk the banks were materially contributing to breaches of human rights standards and that engaging with the banks themselves was unlikely to be effective.

PSNA continued to request the exclusion of other investments due to alleged human rights breaches and focused on four companies that featured on a United Nations Human Rights Council database of companies trading with illegal Israeli settlements — Airbnb, Booking.com, Expedia, and Motorola.

Justice Mount said the chief executive of the Guardians replied to the group in mid-2024 noting none of the companies “currently meets the exclusion threshold under our Sustainable Investment Framework”.

In later correspondence, the Guardians’ head of sustainable investment reiterated that stance, which led PSNA to indicate it would seek the judicial review.

In his findings, Justice Mount noted the Guardian’s 2020 policy documents identified several standards and benchmarks that were later removed — including the Principles for Responsible Investment, principles of the UN Global Compact, and a broad reference to “other good practice standards”.

Earlier policy removed
The earlier policy referred to several sets of standards described as “universally recognised by the world community — with signatories including investment managers, investee companies and the peers of Guardians — and unlikely to be superseded”.

The 2020 policy stated its applicable principles were based on the UN Global Compact, in particular the requirements to support and respect human rights and “no complicity in abuses”.

It also set a threshold for excluding government bonds where there was “widespread condemnation or sanctions by the international community and New Zealand has imposed meaningful diplomatic, economic or military sanctions”.

Justice Mount noted the almost 3000 pages of evidence filed for the judicial review allowed him to gain a picture of how the Guardians had used their policy documents in practice.

The judge noted the Guardians’ approach to excluding investments was not entirely coherent and the policies failed to meet the basic requirements of the law when alleged breaches of human rights standards were concerned.

The Guardians had a duty to reformulate its policy documents to be consistent with the Act, he said.

Minto celebrated the court’s ruling.

Fund raking in money
The group was confident the Super Fund would divest from Airbnb, Booking.com, Expedia and Motorola once it had rewritten its policies to comply with the law, he said.

The High Court judgment showed the Super Fund had invested $67 million in the four companies.

Minto said the fund was raking in money from appalling breaches of international law by Israel in the Occupied Palestinian Territories of Gaza, the West Bank and East Jerusalem.

The country’s leading sovereign wealth fund should be setting the benchmark for all New Zealand investment funds, not deriving money from war crimes and massive human rights abuses, he said.

The lack of a clear grounds to exclude companies from investment because of human rights abuses were particularly problematic, Minto said.

“This is beyond outrageous. Our largest sovereign wealth fund, owned by the government on behalf of the people of New Zealand, has no specific references to human rights standards in its investment exclusions policy.”

The case had revealed the exclusions policy was weakened and direct references to human rights standards were removed the year after the fund divested from five Israeli banks, Minto said.

Replaced with vague policy
“The Super Fund replaced a principled policy with an entirely vague and subjective assessment of companies which meant they could resist pressure from human rights groups such as PSNA.

“The fund was entirely making up legal sounding excuses as it went. It meant they could now keep on their books other companies which abuse the human rights of Palestinians,” he said.

“The Super Fund owes us all an apology and in particular an apology to Palestinians here and in Palestine, whose suffering is helping pay the price of the fund’s increasing wealth.”

Guardians of New Zealand Superannuation chief executive Jo Townsend said the crown entity was still considering its response to the decision.

“We recognise that we are investing on behalf of all New Zealanders, and that gives people a legitimate interest in how we manage the fund,” she said.

“We will thoroughly evaluate today’s decision and determine how best to respond to it,” she said.

The UN Human Rights Council database featuring the four companies is from a list of 97 companies involved with illegal Israeli settlements.

The database came about following a 2016 UN Security Council resolution, co-sponsored by New Zealand, that led to diplomatic rupture between the two countries and Israel recalling its ambassador.

Israeli media reported at the time that Prime Minister Benjamin Netanyahu warned Foreign Affairs Minister Murray McCully proceeding with the resolution wold be considered a “declaration of war”.

This article is republished under a community partnership agreement with RNZ.

New Zealand Prime Minister Jacinda Ardern and Minister of Finance Grant Robertson used today’s post-cabinet briefing to discuss the shifting ownership of the national Kiwibank and flooding in the South Island districts of Nelson and Marlborough.

But they also faced questions over rogue Labour MP Dr Gaurav Sharma and planned protests tomorrow at Parliament.

Cabinet this week was expected to consider further support for flood-affected communities, including in Nelson and Marlborough after Ardern and Emergency Management Minister Kieran McAnulty examined the damage today.

• READ MORE: Parliament protest: Barricades erected, public urged to plan ahead

Ardern said she was always mindful that visits to significant weather events — like those in Nelson — and natural disasters only gave a snapshot, often several days into the response and after some of the clean-up had begun.

“With all of that in mind there is no question that the rain in the region has been devastating. Homes have either become uninhabitable or they have large slips sitting precariously behind them,” she said.

The recovery would take some time, but she saw a very tight-knit community working hard to help out one another.

“Scones being brought to workers, the woman who delivered chocolates to the digger operators. I asked one woman if her home was okay. ‘Yeah, we’re absolutely fine,’ she said, ‘except for the car hanging above it.’

“It transpired that she couldn’t return home, but she seemed much more worried about everyone else, much more so than herself.”

Ardern said one of the biggest concerns in the Marlborough region at the moment was reconnecting those who had been cut off from the usual transport routes.

Watch the media conference

After discussion with McAnulty, the government will be kicking an initial $100,000 into the Marlborough relief fund, which was expected to be further extended.

The Nelson mayor had also requested a further $100,000, which took the Nelson fund to $300,000.

These funds were for immediate response, and were highly discretionary on the part of the mayors.

Ardern highlighted that they did not amount to the full recovery cost, and came separately to things like the funding for repairing roading, or support from the Ministry of Social Development.

Government taking control of Kiwibank
Ardern said it was both exciting and reassuring that the government had secured Kiwibank’s long-term future in New Zealand ownership, with the crown taking over from crown-owned NZ Post, Accident Compensation Corporation (ACC) and the NZ Superannuation Fund.

“Not only will this safeguard all future profits to stay in the country — unlike the Australian-owned banks — it will also continue to enhance competition in the banking sector,” she said.

“The government is fully committed to ensuring Kiwibank is supported to meet its full potential and that includes ensuring access to capital, so the bank can be a genuine and credible competitor … which operates independently of the government but that is able to compete on a level playing field with the big Aussie operators.”

Robertson said the move honoured the purpose and intent of Kiwibank when it was set up in 2002.

“This transaction has come about as the circumstances for the shareholders since 2016 — New Zealand Post, ACC and the New Zealand Super Fund, all crown-owned — their interests in Kiwibank have diverged … since this time.”

He said the acquisition would not change the overall value of the crown’s balance sheet, but owning shares in Kiwibank did not fit with NZ Post and ACC’s long-term plans, including NZ Post’s goal of growing its core delivery business, and ACC’s long-term investment strategy has evolved beyond owning shares in a bank.

NZ Super Fund was interested in a majority holding, but withdrew its interest as it did not align with the government’s ownership objectives.

New Zealand public ownership of the bank was a bottom line for the government, Robertson said, as it was for the previous National-led government.

“Kiwibank will continue to operate independently and at arm’s length from the government with the crown’s ownership of Kiwi Group Holdings through a newly incorporated schedule for a company, Kiwi Group Capital.”

Robertson said Kiwi Group Capital would be governed by a board of directors and the shares would be held by shareholding ministers as usual.

“At one level the acquisition is a straightforward transfer of assets … the government does have to fund this transaction and this will be through the government’s multi-year capital allowance.

“This means that the cost to purchase is already reflected in the borrowing programme we announced at Budget 2022 and has no impact on the crown’s overall debt forecasts.”

He said part of the transaction would include a special dividend payment to the crown, which was yet to be determined by the board.

Robertson rejected the suggestion the Kiwibank ownership model was changing because New Zealand Post was struggling with its business model.

“What this is, is making sure that a banking institution, that we think’s got a really important role in New Zealand, stays Kiwi-owned, and when the five-year exit limit came off last year we began discussions.”

The Super Fund had wanted a level of flexibility which would have allowed foreign ownership or final sale to foreign entities, “which we simply couldn’t do because our bottom line was to stay Kiwi-owned”.

He believed the bank remained an important part of New Zealand’s banking landscape.

Ardern said after 20 years of operation for Kiwibank, it was an exciting milestone.

Labour backbench MP Gaurav Sharma
Labour’s caucus will tomorrow consider expelling Hamilton West MP Dr Gaurav Sharma.

Ardern said there had been no basis to a lot of the claims that had been made by Dr Sharma, “and I think we do need to have thresholds before we launch into things like inquiries that of course come at considerable expense and of course stress and anxiety to the staff that have been drawn in”.

Dr Sharma provided a recording of someone he said was a senior MP in the caucus to Newshub, who called him after a meeting he was not invited to.

Ardern said she did not think the fact it was secretly recorded was appropriate and she did not intend to chase down details of who it was.

She said it was her personal belief the person who contacted Sharma was trying to help the situation.

A message from minister Kiri Allan, shared to the caucus, which Dr Sharma shared with media in a screenshot he claimed showed backbench MPs were being advised on how to avoid the Official Information Act, had been taken out of context, Ardern said.

“What you can see there is a minister who is concerned — as a decision-making minister, Minister of Conservation, remember … she needs to ensure that no one seeks to compromise that decision-making. It’s only appropriate to remind MPs that it wouldn’t be appropriate to lobby a decision-making minister.”

Ministers worked hard to ensure, where they did have decision-making powers, they treated those decisions very seriously, she said.

“We often can be judicially reviewed on the basis on which we make decisions, we do need to make sure that we undertake those decisions with due caution and it’s important to make sure colleagues know how seriously we take that as well.”

Responding to further questions about Sharma’s claim that MPs were being taught to avoid the OIA, Ardern said it was important that MPs had knowledge about how to handle information.

“A question was asked where an MP raised a situation where a constituent’s information was released in an OIA and was concerned about that … we find ourselves in a conversation where we’ve got a complete misrepresentation of the situation.”

She said whether or not Dr Sharma was expelled would be decided by caucus tomorrow.

The rules dictate that a member facing expulsion must be granted the right to attend and speak, “and of course we follow our rules closely”.

She said Sharma had, to date, not chosen to offer a defence to the caucus, nor had he taken up the offer of mediation.

This article is republished under a community partnership agreement with RNZ.