Jane Ambachtsheer, the partner and global head of responsible investment at Mercer, looks at the problem of investors being excluded from the development of a range of norms, codes, and conventions that seek to govern corporate behaviour.
While investors are increasingly using these conventions and norms to provide the framework for formulating environment social and corporate governance (ESG) policy, they have little involvement in their formation, Ambachtsheer argues in a paper published recently in the edition of the Rotman International Journal of Pension Management.
Ambachtsheer (pictured), who is also an Adjunct Professor at the University of Toronto, Canada, says that the growing global influence of corporations has driven the development of these norms, codes and conventions that cover a range of topics from human rights to the environment.
“The process around creating, ratifying, and implementing norms, codes, and conventions typically involves corporations, governments, and non-governmental organizations, but not investors,” she says in the research paper International Codes and Conventions: Are Pension Funds Missing in Action?
“While investors increasingly utilise these instruments in several ways, there is a missed opportunity to involve them in their development, implementation, and ongoing governance. Much work needs to be done to address this “investor exclusion problem” and more formally embed investors as a stakeholder in emerging global governance structures.”