You can find Harbour's full ESG/Responsible Investing Policy here.
ESG (environmental, social and governance) considerations play a central role in Harbour’s investment philosophy.
Harbour is a market leader for integrating ESG research into our investment process.


ESG considerations are important for two reasons:

As a responsible corporate citizen, with a fiduciary duty to our clients, we have an obligation to consider all types of risk. This includes the environmental, social and governance risks associated with the companies we invest in.

As active investors, we believe that ESG risks and opportunities are often not fully reflected in the market price for securities. We are able to use this knowledge to invest to achieve better outcomes for our clients.

At Harbour, we employ a strategy of integration and company engagement. This means our team researches all the companies we invest in and actively checks for any environmental, social or governance (ESG) risks that may apply to them. It helps our Portfolio Managers develop an understanding of each company, and influences not only whether we invest in companies, but also how much. It helps us to unearth companies which may be great opportunities for long term growth, as well as companies with potentially hidden risks.

We are able to use our role as a shareholder to engage with company leadership, highlight any concerns we may have and use our influence to encourage better behaviour. 

We also use a baseline of exclusions in the funds we manage, to remove companies whose business activities may lead to significant harm in society. Exclusions include tobacco, nuclear explosives, cluster munitions, anti-personnel mines, pornography and controversial firearms. 

Our annual Corporate Behaviour Survey researches how companies rate on issues like:


  • Carbon emissions
  • Energy use
  • Waste
  • Environmental policies and risk management


  • Health and safety
  • Modern slavery
  • Stakeholder relations
  • Diversity


  • Board composition
  • Executive remuneration and incentives
  • Ethics
  • Anti-competitive practices

Harbour has been a UNPRI signatory since 2010. 

PRI logo

Harbour is also a member of the RIAA.

RIAA logo

Policy Submissions

Harbour’s engagement program not only focuses on constructively working with companies in our investment universe, but also contributing to public policy/regulatory consultations to positively influence policy settings relating to ESG considerations. 

Date Link to submission Submitted to
Mar 2021 Submission on the Climate Change Commission’s Draft Advice Climate Change Commission
Dec 2019 Climate change-related financial disclosure submission Ministry for the Environment & Ministry for Business, Innovation and Employment
Oct 2019 Submission on green bonds and other responsible investment products Financial Markets Authority
Aug 2019 Clean Car Standard & Clean Car Discount submission Ministry of Transport
Jul 2018 Zero Carbon Bill Submission Ministry for the Environment
Jun 2018 Response to NZX Listing Rules Review, second round NZX
Nov 2017 Response to NZX Listing Rules Review NZX
Oct 2016 Submission to NZX Corporate Governance Code Review NZX



Active Ownership

We demonstrate our responsible investing philosophy and fiduciary duty by keeping active in our investments through our extensive engagement programme and proxy voting process. 

Harbour’s engagement strategy over 2020 continued to focus on climate change but with a move towards greater emphasis on social aspects such as Modern Slavery. This follows from higher regulatory scrutiny particularly overseas with the introduction of the Modern Slavery Act in Australia and heightened attention on looking after stakeholders in the challenging conditions brought by Covid-19. There are a variety of different social issues that are increasingly valued by investors, consumers and wider communities such as Modern Slavery, diversity and labour relations, and there can be significant reputational consequences for any large violations which can limit a company’s social license to operate.

Our climate change engagement continued, particularly at the start of the year where we conducted another research project on the subject which followed the carbon emissions disclosure project from 2019. This project was a deep dive into one of the mechanisms for decarbonising in NZ, the adoption of electric vehicles. This research gave us a clearer picture on the rate at which corporates were transitioning to lower emissions vehicles to mitigate the effects of climate change as well as investigate the potential barriers for further uptake.

We, along with many other investors began to focus more on social issues as Covid-19 brought many human rights concerns to the spotlight. As part of a research project into social considerations we conducted towards the end of the year, we engaged with several NZ listed companies to understand more about their approach to supplier relations/modern slavery as well as collect any additional information on their human capital management such as injury frequency rates, turnover and gender diversity.

Our engagement strategy also continued to include companies with contentious ESG issues such as Board composition and executive/director remuneration particularly around company AGMs. Executive remuneration was especially controversial last year given the context of Government wage support, worker pay cuts and/or redundancies from the financial strain caused by the pandemic.

These targeted engagements were supplemented by the general ESG engagement we conduct across our whole NZ investment universe each year as part of our Corporate Behaviour Survey process.

The Corporate Behaviour Survey is our primary way to comprehensively assess how well each company in our NZ investment universe is addressing ESG considerations with engagement playing a key part. More information can be found in our ESG policy.

Engagement Breakdown

During the year we conducted 74 ESG related engagements on ad hoc issues in addition to the 60 engagements we conduct annually as part of our Corporate Behaviour Survey process.

For the ad hoc engagements, these were primarily focused on NZ companies with 68 out of the total 74 conducted. This reflects the fact that our portfolios are either constrained to the NZ market or have a proportionately larger weighting to NZ companies compared to Australia.

There were a variety of different ESG issues covered in these engagements and in some cases involved multiple interactions with the company. As part of our engagement strategy, we engaged with 28 companies on climate change and 24 companies on social aspects including Modern Slavery. We continued to engage on AGM resolutions relating to board composition through 10 director election engagements, 11 on executive/director remuneration and one miscellaneous ESG issue.

Outcomes from these engagements were generally constructive with many of the companies receptive to our concerns and in some cases taking action to improve on the issues identified. We are cognisant that some of these issues are long term in nature and take time to enact change. There were also added logistical challenges brought by Covid-19 such as the inability to thoroughly interview and recruit new Board candidates that we acknowledged and accounted for in our voting decisions. Therefore, we are both patient and confident companies will eventually make the appropriate adjustments, but we will continue to monitor and liaise with them until these are made.

Case Study 1:

An Australian consumer services company contained a contentious resolution in their AGM regarding the approval of their remuneration report. The context was that the company had received Government wage support (Job Keeper) with all staff taking voluntary pay cuts while the CEO was still expected to receive a bonus with the short-term incentive (STI) scheme linked to an undisclosed EBIT target.

We engaged with the management of the company on these issues and they explained how the temporary pay cuts were necessary to prevent large scale redundancies. The global leadership team were still on a wage sacrifice at the time while all other staff were back to normal pay. The STI scheme structure is highly formulaic and the Board decided to stick with the formula which seemed reasonable given the company still performed strongly over the year, exceeding internal budget and market expectations.

Outcome: we were comfortable that the company had taken appropriate steps to justify their executive remuneration structure given the wage assistance and in this case, voted to support the resolution. In addition, the company stated that following our feedback they would consider greater disclosure on their STI and LTI metrics in the coming year given our concerns.

Case Study 2:

At an NZ industrials company’s AGM, there was a proposal to re-elect one of the directors to the Board which our proxy advisor ISS opposed on the grounds that their presence contributes to the Board being non-majority independent. This is due to his classification as non-independent from having an excessive tenure on the Board.

We engaged with the CEO of the company on this issue especially in the context that they had lost one of their independent directors recently. We noted our strong focus on governance and although there is no single correct template for Board composition, we do seek improved levels of independence over time. We applauded the company’s decision two years ago to expand the Board through the appointment of two independent directors but since then an independent director had departed with the Board having no intention to seek a replacement in the near future. Whilst we had no issues with the existing Board, from a renewal perspective we would support another independent director to ensure long term continuity of their strong culture going forward.

Outcome: We expressed how we are open to further engage with the Board/CEO to investigate options to improve Board independence over time, however in this instance decided to vote against the director’s re-election.

Case Study 3:

We engaged with the CEO of a NZ consumer staples company regarding the consideration to acquire an emissions intensive asset. We expressed our view that although we are supportive of the company owning key infrastructure in the upstream supply chain, coal fired boilers for spray drying are not best practice despite lower short=term costs.  We gave an example of how a global peer made a capital investment into an electric/gas boiler a couple of years ago.

We encouraged the company to take a strong environmental focus when new capital expenditure options are reviewed, noting it is a key consideration for us and other global investors for future capital allocations.

Outcome: We welcomed further engagement on the topic and the CEO responded they were receptive to our view and would update the Board on the matter.


Overall, the year has seen substantial disruption caused by Covid-19 but encouragingly, ESG considerations were not neglected as many feared, with corporates reiterating their focus on climate change considerations and a greater attention paid to the treatment of their stakeholders. Our engagement/research agenda subsequently turned towards these social aspects with a focus on company policies and practices around employee welfare as well as supplier relations given the importance of Modern slavery considerations. We were also encouraged by some positive engagement outcomes in governance with examples of companies improving their level of independence and reducing their number of directorships and hence the risk of over-boarding. The coming year is expected to involve a further focus on these important themes as company approaches to these issues continue to evolve.

In addition, we continue to engage companies as any material ESG issues arise, particularly on contentious areas proposed during company AGMs. This also includes maintaining our dialogue with companies that we have identified as lagging in an issue such as Board independence, remuneration or ESG disclosure, by constructively working with them in the long term to achieve the best outcomes for shareholders.