Yesterday, Sharan Burrow, General Secretary of the International Trade Union Confederation, gave a speech before the United Nations Principles of Responsible Investing convening in Cape Town, South Africa.
Last night, she emailed me the text of her remarks.
The title: PUSH THE RESET BUTTON - A LINE BETWEEN
SPECULATION & INVESTMENT
In it, Sharan makes the connection that Robert Reich has not yet made in his powerful documentary film, Inequality for All, about the link between pension investing, economic inclusiveness and environmental ownership for a truly sustainable prosperity in the 21st Century.
Here is an excerpt.
"The Central Role of Pension Funds
"In the discussion on [Long Term Investing] by institutional investors, it is important to distinguish between “asset owners” (pension funds, insurance companies, sovereign wealth funds) and
asset managers (asset management firms, bank asset management branches) and to
give primacy to the former over the latter. That is particular true for pension
funds with liabilities that can span over 20-30 years, (i.e., the time needed
to accumulate capital to finance workers’ right to retirement). With over USD30tr assets under management,
pension funds represent an important class of asset owners.
"Importantly, pension
funds have a social purpose, that of financing workers’ right to retirement and most often they are
established as part of a collective bargaining agreement and include
member-nominated representatives on their board of directors. Given their
social purpose, it would make sense for
pension funds to embrace fully both a negative and positive list approach to
LTI – shifting away from short-term to long-term
investments, mainstreaming responsible investment practices, greater portfolio
exposure to infrastructure and job creation projects."
Once pensions fully embrace their stewardship responsibilities to invest with social purpose by going long term, it is a easy step to going evergreen.
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