The debate about fiduciary duty is one which NSFM members and others have been pushing whenever and wherever we can, but generally it's in specialist circles and publications. This weekend, the (UK) Observer carried an unusually challenging op-ed about what should be the real fiduciary duty of asset owners. It was written by its business editor, Ruth Sunderland, and many of the arguments would resonate with NSFMers:
Companies do not run in isolation in a purely economic universe – they operate in an environmental and social context, and it is part of good ownership to be aware of this.
The view of successive governments is that shareholders, not politicians, should be the overseers of boardroom behaviour, but there are too many weak links in the chain. The interests of the end owner – the pensioners on whose behalf all this activity is supposed to take place – are at best seen as a sideshow, at worst totally ignored.
Her article ends with a head-on challenge: The UK has a banking crisis, an energy crisis and a pensions crisis. The custodians of our retirement funds have, by their laissez-faire behaviour, aided and abetted business in its pollution of society by dirty oil and toxic banking. It is time they started to act like real owners, for the sake of pensioners – and for the sake of their children and grandchildren.