Kiwis will help fund the Don’s great wall
Some companies that KiwiSaver funds invest in profit from securing the US-Mexico border, writes Rob Stock.
DONALD Trump has vowed to build his great wall and make Mexico pay for it – but it seems many Kiwis will also help foot the bill.
The president’s election pledge could actually be good news for KiwiSavers, as some of their money is invested in private contractors currently running security on the 3200km US border with Mexico.
And at least one US-listed company that appears in some KiwiSaver funds has thrown its hat into the ring for contracts to build Trump’s permanent wall.
The border security relationship between the US government and private enterprise is dubbed the US ‘‘industrial border complex’’, and involves many large, multinational companies listed on stock exchanges in New York and London.
KiwiSaver funds invest in the shares of giant global companies, and inevitably, that exposes investors to the prospect of profiting from the building, and policing of Trump’s wall.
By Tuesday last week, more than 220 companies had begun pitching for contracts to build Trump’s wall, including Raytheon, a giant US construction company, whose shares was a holding in the Westpac Growth KiwiSaver fund.
They are also in the Vanguard International Share fund, which provides ASB and Simplicity KiwiSavers with their international share investments.
US-listed Vulcan Materials, which is also in Vanguard funds, is also thought to be bidding for contracts.
In the US, the media spotlight has fallen on which private companies stand to gain most from Trump’s policies.
ABC News and the Wall Street Journal have both sought to highlight which are earning most from helping keep Mexicans out of the United States.
Most KiwiSaver funds own some shares in one or more of those companies – including wellknown companies like Unisys, Lockheed Martin, and Boeing, as well as less well-known ones like the London-listed G4S group and US-listed Israeli company Elbit, both of which are found in the Vanguard fund.
Simplicity founder Sam Stubbs says KiwiSaver investors will find something they don’t like in many companies their money is invested in.
‘‘With large multi-national companies, if you dig hard enough, you will find something,’’ Stubbs says.
While some ethical investment questions attract broad agreement, such as New Zealanders demanding KiwiSaver funds be free of cluster bombs, anti-personnel mines and nuclear weapons, others are not so black and white, and do not attract broad agreement.
If a KiwiSaver adviser attempted a KiwiSaver Trump purge, it would be hard to know where to stop, Stubbs said.
Little short of excluding all companies doing business in the US would avoid profiting from Trump policies. ‘‘You wouldn’t be invested in very many companies at all,’’ Stubbs said.
Ethical investment expert Roger Spiller from Money Matters said KiwiSavers who wanted to minimise their exposure to some of Trump’s policies should opt for one of the increasing number of REUTERS ethical, or socially-responsible KiwiSaver funds, a list of which has been produced by Canstar.
‘‘If you hear Donald Trump announcing a huge increase in military spending, you know you are not going to be supporting that, or profiting from it,’’ Spiller said.
Ethical funds are also often more heavily invested in more environmentally friendly companies, and some like Booster’s socially responsible fund have gone fossil fuel-free.
Investing in an ethical fund was ‘‘a vote for a more progressive policy agenda’’ than Trump was offering, Spiller said.
‘ With large multinational companies, if you dig hard enough, you will find something.’ SAM STUBBS