Friday, November 07, 2008

At UN conference on Responsible Investment


Quick post during the lunch break, from the "Palais des Nations" in the United Nations, Geneva, Switzerland. I am at a "public-private workshop" co-hosted by UNCTAD and PRI (Principles of Responsible Investment).

There are about 200 delegates and visitors from all other the world. The full title is "Policy Context for Responsible Investment". For once the UN has got its timing perfect. I'll post further on the speakers when I get home. The Chair of PRI, Donald MacDonald, (BT pension scheme trustee) introduced the conference with an excellent speech on the collective failure of the investment chain and what needs to be done. The "big issue" is of course the world wide financial crisis, what caused it and what is the role of responsible investment in getting us out of this hole. Policy makers, financial services and investors. Also, how we can stop (or rather mitigate) against it ever happening again. All music to my ears.

One observation is that fund managers keep referring to themselves as "investors". While it is "good" that they do identify themselves in this way, they are not investors, we are. The small savers, pension and insurance policy holders who are the beneficiary owners of companies. They are financial contractors who we employ to look after our money and we should never forget this. My argument is that if the real investors (or owners) had played a greater role in the governance of their money we would not be in the mess we are now in.

The UN site itself is not what I expected. It reminds me of a 1960's University with endless long corridors. It is set in well maintained gardens overlooking the Lake with Peacocks wandering around freely.

BTW - excellent news about the Labour by-election victory in Glenrothes!

8 comments:

Anonymous said...

You could at least spell the name of the constituency correctly???

Anonymous said...

Who paid for this juncket?

Anonymous said...

I think your argument that somehow if the small savers directed and ran their funds we would all be better off is just ridiculous. Maybe if shoppers at supermarkets also ran farms then food would be cheaper, or if we all directed military operations then the Afghan war would be over quicker. I learned a long time ago that the financial markets are complex and that Joe Trade unionist is the worst possible governor of anyones finances. Just becaues you are interested in pensions doesn't make you an expert in investments. Like Brown with his specious "no more boom or bust" claim..now the IMF and the EU put the UK as the economy that is in the worst possible position of all developed nations to weather the current economic downturn but Brown claims we are will placed? Amateurs claiming that they are experts in anything are dangerous. Lord Snooty.

John Gray said...

Hi Anon 1

Whoops - thank you for the advice about the typo.

Hi Anon 2

UN/PRI I assume paid for the conference. I sincerely hope you are reassured that it was well worth it!

John Gray said...

Hi Lord Snooty
I don’t actually think that I suggested small savers themselves “ran” their own funds? However, thinking about your supermarket reference, one of the most successful supermarkets in this country (Waitrose) is run by employee representatives and they also own some of their farms. Also, I am pleased that my local supermarket will soon by run by, there I say “the Co-op”!
Obviously you don’t believe in capitalism or free markets so you are quite content for the status quo to continue and for companies to be run by people who have no regard for the interests of its actual owners?
I’ll post on things in detail soon, but is it so bad an idea that properly trained and supported trade union representatives sit down with employer representatives and (real) independent financial advisors and examine the governance arrangements of the companies they invest in? Maybe, just maybe, like that well known communist, Warren Buffet, they would have seen off the overpaid banking “wizards” with incomprehensible toxic products which no-one understood?
Anyone, what is the alternative? invite these wizards back from their Caribbean islands and bolt holes and “say more of the same please”? Come off it, your economics has failed and you need to recognise this and move on.

Anonymous said...

If you think that the 40,000"partners" in Waitrose are "Managing" the company then you have very little idea.

CapitalWorker said...

anonymous I don't think John is saying that, the drift of UNPRI is they have $18trillion committed to responsible investment - small savers yes - but big collective money/ownership

John Gray said...

Hi Anon

"40,000 managing"

No, they don't but Waitrose is a sucessful example of a organisation with different ownership structures. It works, Northen Rock et al didn't due I think to its failure of ownership