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The Good Returns article by Andrea Malcolm highlights evolving strategies in investor stewardship beyond traditional approaches such as ESG, company engagement, and proxy voting. Key points include:
New Perspectives: Insights from a global training at Oxford University, featuring Jackson Rowland and other experts, suggest that investor stewardship is expanding beyond conventional methods.
Challenges in Engagement: While investor engagement with companies on risk management is important, there are limitations. For instance, some companies, particularly in the fossil fuel sector, are resisting changes, as seen with Netherlands-based PFZW’s exit from numerous fossil fuel investments due to inadequate decarbonization plans.
Broader Strategies: The Oxford programme highlighted the potential for investors to influence outcomes through broader strategies, such as engaging with government and regulatory policies. This approach can address systemic issues and benefit portfolios indirectly.
Local Examples: In New Zealand, fund managers have attempted to influence policy, like with the Modern Slavery Reporting Bill, but faced setbacks. Additionally, investors are exploring ways to engage with product users and NGOs to address issues more effectively.
Strategic Influence: Investors are increasingly looking at diverse ways to manage risk, leveraging their networks and various stakeholders beyond direct company engagement.
Overall, the article emphasizes a shift towards more strategic and holistic approaches in investor stewardship to better manage risks and create value.