The forum says the lack of disclosure requirements for private companies is contributing to a divide in New Zealand's capital markets and they — as well as asset owners, fund managers, financial institutions and insurance companies — should be included in the sustainable reporting regime.
There are 720 private companies with revenues more than $50 million and 480 earning more than $100m, and are profitable. This compares with 70 profitable NZX listed companies with revenues of more than $30m.
Last year's industry-led Capital Markets 2029 review also found disclosure of investments in KiwiSaver schemes vary between providers, and the forum recommends greater disclosure obligations to ensure transparency of investments and operations. The KiwiSaver providers should report each quarter and disclose their top 20 exposures.
The forum is calling for the recommendations in Ākina's Structuring for Impact report to be adopted, and for impact or ethical investing to be promoted. Ākina, established by the Todd and Tindall foundations, has established a three-year social enterprise development programme with the Internal Affairs Department to address challenges like poverty, inequality, waste management, biodiversity loss and climate change.
The Ākina report identified structural barriers preventing a wider range of organisations from prioritising positive social and environmental impact alongside profit. Impact-driven businesses are different from traditional profit-driven companies because they trade to deliver social or environmental outcomes and reinvest their profits back into their mission. Impact-driven businesses are neither a charity or fully-commercial organisation and struggle for access to finance. The forum wants to see a legal structure that enables and supports business and investment towards positive environmental and social outcomes.
