Page 15 - 15717 Trust Waikato Annual Report

The Trust continues to be a signatory to the Principles for Responsible Investment (PRI), an initiative of the UN and the investment community. The PRI provide an aspirational set of guidelines for ensuring that environmental, social and governance issues are taken account of by investors. In 2010 the Trust also joined the Responsible Investment Association of Australasia. The Trust takes seriously its role as an asset owner and wants to ensure its investment returns are sustainable and beneficial for communities and our environment. During the year, the Trust moved a portion of its investment in global equities to a Generation Investment Management fund focused on sustainable investing. The Trust also confirmed that it did not wish to hold securities in its Australasian equities and New Zealand fixed interest and cash portfolios, where a significant proportion of the return came from armaments, liquor, tobacco or gambling. In the coming year, the Trust will continue to implement its commitment to responsible investing.

TRUST WAIKATO WAS ESTABLISHED BY

GOVERNMENT STATUTE IN 1988 TO HOLD THE SHARES OF TRUST BANK WAIKATO (FORMERLY THE WAIKATO SAVINGS BANK). Its financial resources exist because for several decades local people banked with the local community bank.

In 1996, the Trust sold its banking shares and has since invested in a range of financial assets. The initial value of the capital fund in 1996 was $169.8million. At 31 March 2011, that capital fund had grown in value to over $254.7million. Over the 23 years of the Trust, more than $119million has been donated to communities around the Trust region.

Trustees see their role as guardians, or kaitiaki, of the capital fund for both current and future generations in this region. Ideally the Trust’s capital fund will be worth just as much for our grandchildren and their grandchildren and their grandchildren, as it is for us today. That means investing wisely to grow the value of the fund to keep up with inflation and population growth as much as possible, while still donating consistently to assist local communities today. Sometimes that’s a delicate balancing act.

For the year ended 31 March 2011, the Trust’s investments returned 8.6%. During the year, the Trust decided to adjust its allocation to different financial asset classes to provide further asset diversity and greater protection around inflation and volatility.