UKSIF policy submissions

Some good stuff here. Some of the commentary in the Walker submission in particular is interesting, and I'm glad that someone is saying things like this -

Management literature has long suggested that remuneration is a “hygiene factor” rather than a “motivator”, ie. talent may be de-motivated by what is perceived as insufficient remuneration but only transiently motivated positively by remuneration. Other motivators are more effective for delivering high quality sustained performance. The remuneration debate to date has largely failed to reflect this insight.

UKSIF report on pension funds

A quick plug for UKSIF's survey of pension fund practice in terms of ESG issues. More details here. Headlines below:

BT Pension Scheme retained its Platinum ranking in this second bi-annual survey, while The Barclays UK Retirement Fund, BP Pension Fund and HBOS Final Salary Pension Scheme all progressed to a Gold ranking from Silver. Three quarters of repeat respondents achieved a higher score this year than in 2007.

The survey found that trustees of three quarters of surveyed funds now believe that ESG (environmental, social, governance) factors can have a material impact on the fund’s investments in the long term. Two thirds of trustees thought it was important to align the plan’s RI policy with the fund sponsor’s CSR policies.

Matthew Taylor UKSIF annual lecture

This (PDF) is well worth a read. I missed the actual lecture, but the text is available online now. It's always interesting to read a view on markets, investors etc from someone thoughtful who doesn't work in the sector (and as such is willing to pull in insights from elsewhere). Quite a few references to behavioural economics in there, and even a mention of S&M's Chris Dillow (and I have to say I think I'm closer to his views of the public company model - I don't think it's bust, but it doesn't work how some suggest it could/should). Deffo worth 5 mins of your time!

Hat-tip: Adam

UKSIF report on pension funds and SRI

One of the annoying things about the failure of many corporate pension funds to take SRI seriously is that some of them are sponsored by companies which are leaders in the area of corporate social responsibility. With this in the mind the UK Social Investment Forum surveyed companies which are included in initiatives like the FTSE4Good index to see what their practice was like.

The overall message was fairly positive with about three quarters of respondents saying that they do have an SRI policy. Most common methods of implementation are shareholder voting and engagement. However worryingly (if you have any knowledge of the wide variation in fund manager commitment to SRI, or corporate governance for that matter) most funds said that they also delegate implementation of their policy to their fund managers.

The UKSIF report also ranks pension schemes in terms of their practice. The BT scheme comes top of the list, with the Friends Provident and Stagecoach schemes close behind. Of these I'm actually most impressed by Stagecoach as both the BT scheme and the Friends Prov scheme have in-house asset manager expertise to draw upon.

Anyway, the full report can be downloaded here.

15 years of the UK Social Investment Forum

Anyone interested in SRI in the UK will have come across UKSIF at some point. This is their 15th year of operation and this report provides a history of the organisation. I first came across them around 1998 when the Government first trailed its plans to introduce the disclosure amendment to the Pensions Act requiring to disclose their policy (if any) on SRI and shareholder voting. It was also the first time I realised how conservative the pensions industry is, as even this modest proposal resulted in a ridiculous and hysterial reaction.

UKSIF continues to do interesting work, such as the ongoing sustainable pensions project. They also held an interesting event recently on the psychological (ie behavioural) barriers to the adoption of SRI by pension funds.