The value creation boundary, a margin between innocent bystanders and the parties involved in an economic activity, is a powerful thinking device for asset owners and managers to use in considering their investment responsibilities. So should long-term investors expand the boundary and include more of humanity in the consequences of investment decisions?
The returns we need can only come from a system that works; the benefits we pay are worth more in a world worth living in, argues Marisa Hall from the Thinking Ahead Institute.
Ideas about how businesses generate value and which groups benefit continue to evolve. The Thinking Ahead Group argues there are four sets of stakeholders, and has metrics in mind for each.
A long-term investor has an advantage that lies in the skill to identify divergences between price and value in markets, and the willingness to wait for a convergence to take place.
A more meaningful way of keeping defined contribution savers informed and engaged could be through communication in relation to their contribution rates.
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