EC’s sustainable governance play: Asset owners wary of potential snags
The idea of drawing up EU rules to ensure companies embed sustainability into the way they operate has met with steady applause from pensions and asset management industry representatives – as well as warnings of potential unintended consequences.
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Questions put out by the European Commission in its consultation on an initiative on sustainable corporate governance – which closed in early February – centred around topics such as directors’ duty of care and stakeholders’ interests, companies’ due diligence duties and board composition and remuneration.
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Brexit notwithstanding, public sector pension funds in the UK voiced strong support for an EU legal framework in this area, and warned of the financial fallout of inaction.
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Cllr Doug McMurdo, chair of the Local Authority Pension Fund Forum (LAPFF), said: “I want to emphasise that how we treat people and the planet is financially material to our members’ investment considerations.”
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