Investors missing out on having their say on international codes and conventions

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.”

The paper can be accessed here

Sponsored Content

Leave a Comment

GIC, Temasek eye trillions of growth in climate adaptation market

GIC, Temasek eye trillions of growth in climate adaptation market

Singapore’s two largest asset owners, GIC and Temasek, see attractive opportunities in climate adaptation solutions – a relatively underfunded area compared to decarbonisation. The former has already made selective adaptation investments and said the opportunity set across public and private debt and equity could increase to $9 trillion by 2050.

Sort content by

Serious policy barriers limit long-term investment

The OECD annual survey of large pension funds and public pension reserve funds, reveals the “existence of serious barriers that need to be urgently addressed at policy level” to encourage long-term investment. The survey, which looks at 86 institutional investors from more than 35 countries accounting for $9.7 trillion in assets, as part of a

Stress scenarios for 
Japanese bond yields

Oleg Ruban at MSCI finds that the stories behind yield rises in Japanese government bonds matter greatly. They influence the correlation between Japanese equities and government bonds, which is crucial in determining the size and direction of the impact of these scenarios on representative portfolios in different geographical segments and asset classes. Why does this

Dynamic allocation using minimum volatility

Active managers who are increasingly on the ropes as beta strategies encroach upon their alpha returns can take heart from the latest research from index provider MSCI. In the latest insight from Barra, Dynamic Allocation Strategies Using Minimum Volatility: Detecting Regime Shifts to Enhance Active & Passive Investing, Philippe Durand and John Regino argue that

Pension issues with Chinese characteristics

This policy memorandum from the Paulson Institute describes the current state of the Chinese pension system and offers some suggestions to address a range of issues. The author, veteran academic and policy wonk Robert Pozen, discusses the key challenges facing the Chinese pension system, examines the causes of each of these challenges and puts forward

Deconstructing risk parity portfolios

In this paper MSCI applies its framework for defining macroeconomic risk to strategic asset allocation, labelling assets as either risk premium or risk hedging. It applies the analysis to arisk-parity portfolio, showing how its relatively high exposure to inflation shocks makes it a risk premium portfolio.   To access the paper click here    mrec4inarticleinline

Investment consultants: the heart of systemic failure?

In this engaging Edmond J Safra Research Lab Working Paper, Investment consultants and institutional corruption, lawyer Jay Youngdahl looks candidly at investment consultants in the United States. Describing them as gatekeepers between institutional investors and the peddlers of financial products, the author identifies ethically dodgy and widespread practices, and suggests they are at the heart

Previous