EDITORIAL

Finance ‘not just about making money’

Finance should not be about making money, according to Nobel Laureate, Professor Robert Shiller, so how can the industry move to integrate missions for society within financial institutions? Shiller will address the Fiduciary Investors Symposium at Yale School of Management from October 23-25.

Historically, financial innovation has benefited many people, but it has moved away from a profession where fiduciary responsibility matters, to where making money matters. According to Nobel Prize-winning economist, and author of Irrational Exuberance, Robert Shiller, finance should not be about making money.

So when does financial innovation create complexity and opaqueness that harms society and when can financial innovation be used as an enabler of equality, a solution to the current problems of jobs and inequality? Shiller will discuss these ideas and challenge the industry to move to integrate missions for society within the structure of financial institutions.

Shiller, who warned of both the tech bubble and the housing bubble, says that irrational exuberance among investors has only increased since the 2008-09 crisis and contends that psychology-driven volatility is an inherent characteristic of all asset markets.

He will give a keynote address at the Fiduciary Investors Symposium at the Yale School of Management from October 23-25.

The event brings global investors together to examine best practice investment strategy and implementation, including the latest thinking relating to asset allocation, risk management, beta management and alpha generation. It has become recognised as an event that challenges the influence and responsibility of fiduciary capital and explores the evolution in investment management.

With great fiduciary power comes great responsibility

Managing assets as a fiduciary comes with a complex range of responsibilities and commitments. This conference examines the holistic approach to fiduciary investing and how investing has and should evolve. This includes the wider responsibilities of long-term investors in stabilising financial markets, and the impact of investments on social welfare and environmental management.

The Fiduciary Investors Symposium at Yale School of Management will focus on the relationship between finance and the broader economy.

The event will draw on the school’s focus on finance within the economy and broader society, and highlight the work of Shiller and William Goetzmann, who say there is a need to discuss structural changes to finance in order to prevent a recurrence of the global financial crisis.

Confirmed speakers from Yale include:

  • Zhiwu Chen, Professor of Finance, Yale School of Management
  • William Goetzmann, Edwin J. Beinecke Professor of Finance and Management Studies and director of the International Center for Finance, Yale School of Management
  • Roger Ibbotson, Professor in the Practice Emeritus of Finance, Yale School of Management
  • Tobias Moskowitz, Visiting Professor of Finance, Yale School of Management
  • Robert Shiller, Sterling Professor of Economics, Yale University
  • Jeff Sonnenfeld, Senior Associate Dean for Leadership Programs and Lester Crown Professor in the Practice of Management

Importantly, the event will cover issues pertaining to long-term investment and fiduciary duty. In particular there will be sessions focusing on a report from the World Economic Forum on the future of investing, next generation environmental, social and governance (ESG) integration and the UN sustainable development goals, and the role of investors in holding Wall Street to account.

The event, which is only open to asset owners, will use case studies to highlight best practice as it applies to asset allocation and investments, governance and decision-making.

Held over three days, the event enables institutional investors to engage with industry thought leaders in academia and practice in a collegiate environment that promotes shared discussion. The on-campus venues facilitate a unique space for different thinking and discussion, and the event includes tours of various university faculties.

For more information about the program, and to register, visit The Fiduciary Investors Symposium website

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