Keith Johnson writes: The NSFM in person meetings on 7 March in London and 9 March in Amsterdam included presentation of a public consultation paper on Reclaiming Fiduciary Duty. That paper is now posted [here] for broader NSFM participant and public comment. It builds on prior work of the NSFM Fiduciary Duty Working Group and is part of a larger project to develop key performance indicators for fiduciaries.
Asset owners are increasingly aware of the need for clarity in their fund manager mandates on their expectations for long-term investment. To help address this need, the Shareholder Responsibilities Committee of the ICGN has established a working group, led by NSFM participant Paul Lee, to consider and promote best practice in the agreements between asset owners and their fund managers, with the aim of promoting more long-term behaviour in the capital markets and a greater focus on key risks.
On 7 and 9 March the NSFM held two ‘in person’ meetings in London and Amsterdam. 30 NSFM participants came along to debate long-term issues and systemic failures in the financial markets.
Michael Mainelli writes: Pension policies everywhere are being pensioned off – defined benefit schemes in the UK are closed to new members or closing down; private sector workers are outraged by public sector pension commitments; the young are outraged by obligations to the old; and accountants and actuaries around the world should be ashamed of their historical performance – and would be, if they weren’t so busy re-estimating future liabilities from minute to minute, and charging fees.
Penny Shepherd writes: Since the financial crisis, there has been public outrage at financial services pay levels, and at “banker’s bonuses” in particular. However, most of the resulting debate has remained stuck inside the dubious paradigm that pay is the most effective way to motivate performance. This results in a potentially fatal assumption that if we can align payment with the right targets and probably also restrict the absolute amount then all will be well.
The CFA Institute, the global association for investment professionals, has presented NSFM participant, Keith Ambachtsheer with its Award for Professional Excellence. In addition to being an NSFM participant, Mr. Ambachtsheer is adjunct professor of finance at the University of Toronto’s Rotman School of Management, Director of its International Centre for Pension Management, and Founder/President of KPA Advisory Services. Previous recipients of the award include David Swensen, Martin Leibowitz, Jack Bogle, Charles D. Ellis, CFA, Warren Buffett, and Sir John Marks Templeton, CFA.
Frank Jan de Graaf and Keith Johnson write: One of the most important, yet least reported, initiatives coming out of the World Economic Forum (WEF) meeting in Davos this year is a renewed focus on sustainable business and investment practices. The WEF issued a white paper, entitled "Accelerating the Transition towards Sustainable Investing." A copy of the report is available here. It is well worth reading.
Matthew Kiernan writes: The World Economic Forum has always, quite rightly, prided itself on its laser-like focus on global mega trends, the “big picture”, and, to quote the WEF’s own motto, “improving the state of the world “. So far, so good. Indeed, when it comes to diagnosing the world’s greatest economic, social, and environmental challenges, the WEF has few peers. If, however, one’s tastes run more to catalyzing solutions and real action on the ground, then Davos might not be your cup of tea.
NSFM Fiduciary Duty Working Group Materials Highlighted in UNPRI Webinar: The United Nations Principles for Responsible Investment (UNPRI) Academic Network hosted a webinar on 19 January 2011 which featured work done by the NSFM Fiduciary Duty Working Group. The NSFM presentation examines how outdated factual assumptions that underlie late twentieth century interpretations of fiduciary duty, together with the unnoticed substitution of investment theory (which itself has come under considerable criticism) for fundamental legal principles, have undermined pension sus