Are the world's big shareholders finally grasping that, as the technical owners of listed companies, they have long-term financial and social responsibilities? There are a few signs.
You can see it starting in the pay protests across the sector. And you can see it in the regular divestment from fossil-fuel firms (more for fear they will be hit hard financially by climate change related legislation than anything else, I suspect). But there's something more interesting afoot outside the longstanding rows about pay and oil.
A coalition of 71 investors overseeing more than $2trn in assets has put out a warning abut antibiotic use by ten giant food companies (including Dennys, Greene King, Whitbread and the Cheesecake Factory). The idea is to try and persuade them to work to prevent the routine use of antibiotics by meat and chicken suppliers so as to cut the risk of full antibiotic resistance in humans.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
This is excellent news. That's partly because the risk is high, and anything done to deal with it is good, but also because the fund management companies in question they include Aviva, Boston Common and Coller Capital are finally showing that they are thinking long term.
They recognise that antibiotic failure, could have huge effects on global health but also that government attempts to prevent it if the private sector doesn't get there first, could have huge effects on company profits and hence "truly frightening" effects on their client's long term wealth.
There is, said Lauren Compere, of Boston Common in the FT, "a financial risk linking to companies not anticipating (regulatory changes). As long-term investors, we have a to think about the risk the companies face."
In a perfect world, fund managers would always have been thinking like this. They haven't been. Perhaps this is a small starter of a sign they are beginning to get it.
-
House prices to crash? Your house may still be making you money, but not for much longerOpinion If you’re relying on your property to fund your pension, you may have to think again. But, says Merryn Somerset Webb, if house prices start to fall there may be a silver lining.
-
Prepare your portfolio for recessionOpinion A recession is looking increasingly likely. Add in a bear market and soaring inflation, and things are going to get very complicated for investors, says Merryn Somerset Webb.
-
Investing for income? Here are six investment trusts to buy nowOpinion For many savers and investors, income is getting hard to find. But it's not impossible to find, says Merryn Somerset Webb. Here, she picks six investment trusts that are currently yielding more than 4%.
-
Stories are great – but investors should stick to realityOpinion Everybody loves a story – and investors are no exception. But it’s easy to get carried away, says Merryn Somerset Webb, and forget the underlying truth of the market.
-
Everything is collapsing at once – here’s what to do about itOpinion Equity and bond markets are crashing, while inflation destroys the value of cash. Merryn Somerset Webb looks at where investors can turn to protect their wealth.
-
Value is starting to emerge in the marketsOpinion If you are looking for long-term value in the markets, some is beginning to emerge, says Merryn Somerset Webb. Indeed, you may soon be able to buy traditionally expensive growth stocks on the cheap, too.
-
ESG investing could end up being a classic mistakeOpinion ESG investing has been embraced with enormous speed and zeal. But think long and hard before buying in, says Merryn Somerset Webb.
-
UK house prices will fall – but not for a few yearsOpinion UK house prices look out of reach for many. But the truth is that British property is surprisingly affordable, says Merryn Somerset Webb. Prices will fall at some point – but not yet.
