At the New Zealand Responsible Investment Briefing in Auckland yesterday, Money Matters financial adviser Rodger Spiller said it appeared other New Zealand advisers were finally taking notice of the subject.

“It’s really heartening to see the number of advisers here today… although I would have hoped it would happen before now,” said Spiller, who was the first adviser in this country to be certified by the Responsible Investment Association of Australasia (RIAA).

“It’s often quite challenging in the New Zealand context to get advisers engaged with responsible investing.  I’ve been banging on about it for 20 years.”

Part of the problem, he said, is the lack of local products for New Zealanders keen on responsible investing.

“It’s a chicken and egg syndrome; there aren’t enough products to meet client demand but from a fund manager’s perspective there’s not enough demand to make the products.”

Justin Medcalf, managing director of responsible investment-focused adviser firm the Emerald Group, told the conference that addressing clients’ interest in ethical investing could soon become a regulatory requirement in Australia.

“One of the things coming through is this notion of fiduciary duty.  Advisers will have to prove they have addressed clients’ needs; that relates to products,” he said.

“There’s been some discussion around does this mean that if a client comes in with an ethical or values-based concern and the adviser doesn’t address this concern, the adviser can’t service the client?”

Medcalf said this raised the question of whether advisers are asking the question about responsible investing, as well as the quality and accuracy of advice they are giving if they are.

“I used to have clients coming into me and say, ‘I thought it [responsible investment] underperformed?  I had an adviser telling me, why would you want to lose returns?’”

Spiller said New Zealand advisers should take heed of Medcalf’s comments.

“There are a whole lot of laggards out there and there might be some compliance type situation when the clients aren’t getting the service they expect.”