New guide for "unsung heroes of capitalism": AMNT Open Day

After lunch Tony Manwaring and Anete Dyakova from "Tomorrow's Company" spoke about their new guide 

"Tomorrows Value – Guide for Trustees and Capital Markets initiative" which is due to be launched on 5 March with the support of the Lord Mayor of London and also former chief of the Bank of England, Melvyn King.

Tony describes Pension fund trustees as the "unsung heroes of capitalism". Which will annoy intensively some trustees I know but I think is broadly correct. The guide is a complement to the Kay Review which didn't have many proposals and was more about analysis. He believes that there needs to be a focus on :-

1.What do you believe as a trustee board (your fundamental belief)? 

2.Understand your role and

3. Your fiduciary duty.

I asked him a question whether the pension trustee guidance will also address the governance gap in nearly all Contract and many MasterTrust schemes? He said not as such but if there is governance gap and if you believe achieving long term value then need proper governance. Which I took as really meaning "Yes".

Tom advised Pension fund trustees to be sceptical. If pension funds plans had worked properly in the past they would not be in the mess they are now. He thinks if is awful that the role of trustees has not been recognised.

Anete spoke "Tomorrow capital market" and how important it is to have a mindset as trustees that is not structured and to have sustainable and stable markets.

Does Socially Responsible Investment really matter?

I think it does but twice now in recent weeks I have been in different meetings where Pension trustees (assets owners) have been urged to adopt responsible investment policies but I have been left wondering how seriously the financial services industry (as a whole) takes this issue? Or is this all just lip service?

Socially responsible investment (SRI) is not just about ethnical or green investment. Rather it is the belief that in the long term if you invest in companies that are well governedand act in a responsible way (i.e. no child labour, doesn’t destroy the environment, treat its workers well, doesn’t bribe public officials etc) then they will produce superior returns than companies who do not.

Nearly all large fund managers would claim to invest in a socially responsible way (and of course they would say this wouldn’t they!) yet many do little or nothing about it? Do they really just see RSI as a marketing tool to take in gullible pension trustees when privately they either think it makes no difference or even harms investment returns?

When you challenge them about this they blame us the pension trustees for not being interested in SRI and not making it a priority. Which if true would be a fair comment. But surely the reason why pension trustees don’t appear to be interested in RSI is that many of our professional investment advisors do not tell us that this is a key issue?

They may talk at length (rightly) about asset allocation and (wrongly) about the relative merits of particular fund managers and the latest “star performers” but little or nothing about SRI.

Trustees are very dependent upon professional advisers. Probably too dependent but that is another question. Yet until the professional advisers start making a real issue out of SRI and hammer home the benefits then you must assume that they don’t really believe it makes any difference to investment returns. So if they don’t think SRI matters then don’t be too surprised if the trustees don’t either.

TUC Member Trustee Network Conference: Stronger Stewardship: Trustee Responsibilities in a Changing Pensions Landscape

Hat tip TUC Pension Trustee Network:

"Date Tue, 16 Nov 2010: Time to from 09:30 to 16:30 Location Congress House, Great Russell Street, London

Cost: The cost for attending remains frozen at the level of earlier years and is £50 Unions, £75 Education, Public or Voluntary Sector; Commercial £250. Payments can be by cheque payable to ‘Trades Union Congress’ or by card.

Description: The theme of this year’s Member Trustee Network conference is ‘Stronger Stewardship’ and the conference will take place in Congress House. Delegates will be able to hear from a range of speakers, including the Pensions Minister Steve Webb, about the latest developments in pensions policy. There will also be a choice of workshops.

A buffet lunch will be provided. Please indicate any access or dietary requirements.

The conference will be followed by an early evening reception.

Accessibility Congress House is an accessible building.

Register interest or request more information

If you wish to attend please contact, trusteesATtucDOTorg.uk"

(Picture is of early trade union pension trustees)