INSIGHT by the International Corporate Governance Network (ICGN)
© Wesley Tingey
The International Corporate Governance Network (ICGN) has raised concerns from investors globally on regulatory proposals which could weaken UK corporate governance standards and shareholder protections. ICGN fears this could both undermine the UK’s economic growth and attractiveness as a global financial centre, and create risks for investors’ beneficiaries, including pensioners and savers. Led by investors responsible for assets under management of around $77 trillion, ICGN advances the highest standards of corporate governance and investor stewardship worldwide in pursuit of long-term value creation, contributing to sustainable economies, societies, and the environment. ICGN’s Chief Executive Officer Kerrie Waring said: “With this statement, investors wish to engage in a constructive dialogue with the UK authorities and key stakeholders on measures to promote growth, high quality stewardship, and excellent corporate governance. Robust governance structures, high-quality corporate reporting, and strong investor protections are essential to a competitive market which safeguards corporate resilience, long-term value creation and ensures economic growth.” ICGN’s statement, shared today with UK regulators and standard setters, has been co-signed by major investors and associations who represent institutional investors around the world (see co-signatories below). Waring continued “Far from being a barrier to growth, maintaining high standards of corporate governance and shareholder protection enables growth.”
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The UK’s advanced corporate governance standards have inspired regulators worldwide in their own governance reforms and investors have used them as a gold standard when commenting on other markets’ governance and listing requirements, as well as in their direct engagement with companies. The UK’s reputation for high quality listing and governance standards and resultant overseas investor confidence is both a competitive advantage and a positive differentiator for the UK market.ICGN has cautioned against FCA proposals to replace the current ‘standard’ and ‘premium’ segments with a single listing category, to remove shareholder votes prior to significant transactions and related party transactions, and allow dual-class shares with very few investor protection safeguards. ICGN contends that these proposals will expose investors to undue risk, with potentially significant implications for underlying beneficiaries including pensioners, insurance, and retail investors’ savings.
Co-signatories are as follows:Allianz Global Investors GmbH, Matt Christensen, Global Head Sustainable & Impact InvestingAccident Compensation Corporation, Mark Cross, Chair, Board Investment CommitteeAMEC, Fabio Coelho, Chief Executive OfficerAPG Asset Management, Claudia Kruse, Managing Director, Responsible Investment StrategyAssogestioni, Fabio Galli, Director GeneralAustralian Council of Superannuation Investors (ACSI), Louise Davidson, Chief Executive OfficerAustralianSuper, Andrew Gray, Head of ESG & StewardshipAXA Investment Managers, Gilles Moëc, Head of ResearchBaillie Gifford, Sam Rooke, Manager (ESG - Policy, Projects and Regulation)Boston Common Asset Management, Lauren Compere, Managing DirectorBritish Columbia Investment Management Corporation (BCI), Daniel Garant, Executive Vice President and Global Head, Public MarketsBrunel Pension Partnership, Faith Ward, Chief Responsible Investment OfficerCalifornia Public Employees' Retirement System (CalPERS), Marcie Frost, Chief Executive OfficerCalifornia State Teachers Retirement System (CalSTRS), Aeisha Mastagni, Senior Portfolio MangerCanadian Coalition for Good Governance, Catherine McCall, Chief Executive OfficerChurch of England Pensions Board, John Ball, Chief Executive OfficerColumbia Threadneedle Investments, Claudia Wearmouth, Head of Responsible InvestmentConnor, Clark & Lunn Investment Management Ltd., Martin Gerber, President and Chief Investment OfficerCouncil of Institutional Investors (CII), Amy Borrus, Executive DirectorDowning LLP, Roger Lewis, Head of Sustainability and Responsible InvestmentEOS at Federated Hermes Limited, Bruce Duguid, Head of StewardshipEtica Funds - Responsible Investments, Aldo Bonati, Stewardship and ESG Networks ManagerEumedion, Rients Abma, Executive DirectorGlobal Alpha Capital Management Ltd., Qing Ji, Portfolio Manager, Board DirectorImpax Asset Management, Lisa Beauvilain, Global Head of Sustainability & StewardshipInterfaith Center on Corporate Responsibility, Josh Zinner, Chief Executive OfficerInvestor Alliance for Human Rights, Anita Dorett, DirectorJupiter Asset Management, Kiran Nandra, Head of EquitiesLondon Pensions Fund Authority, Robert Branagh, Chief Executive OfficerMerseyside Pension Fund, Peter Wallach, DirectorMint Asset Management, Rachel Tinkler, Head of Responsible InvestmentNest, Diandra Soobiah, Head of Responsible InvestmentNew Zealand Super Fund, Paula Steed, Chief Executive Officer (acting)Newton Investment Management Limited, Therese Niklasson, Global Head of Sustainable InvestmentNILGOSC – Local Government Pension Scheme (Northern Ireland), David Murphy, Chief ExecutiveNorges Bank Investment Management, Carine Smith Ihenacho, Chief Governance and Compliance OfficerNorthern LGPS, Councillor Gerald Cooney, ChairPensions and Lifetime Savings Association (PLSA), Nigel Peaple, Director of Policy & AdvocacyPeople's Partnership, Leanne Clements, Head of Responsible InvestmentPermodalan Nasional Berhad, Ahmad Zulqarnain Che On, President & Group Chief ExecutivePGGM, Gerard Fehrenbach, Responsible InvestmentPrinciples for Responsible Investment (PRI), David Atkin, Chief Executive OfficerRailpen, Michael Marshall, Director of Investment Risk and Sustainable OwnershipRobeco, Carola van Lamoen, Head of Sustainable InvestingScottish Widows, Vicky Grinnell-Wright, Head ESG and Interim Head of Responsible InvestmentTD Global Investment Solutions (TDGIS), Priti Shokeen, Managing Director, Head of ESG Research and Engagement, TD Asset ManagementUAW Retiree Medical Benefits Trust, Hershel Harper, Chief Investment OfficerUniversity Pension Plan, Aaron Bennett, Chief Investment OfficerUSS, Sandra Carlisle, Head of Responsible InvestmentWalter Scott, Jane Henderson, Managing DirectorWest Yorkshire Pension Fund, Euan Miller, Managing DirectorWoodsford, Steven Friel, Chief Executive Officer
All opinions expressed are those of the author and/or quoted sources. investESG.eu is an independent and neutral platform dedicated to generating debate around ESG investing topics.
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The UK’s advanced corporate governance standards have inspired regulators worldwide in their own governance reforms and investors have used them as a gold standard when commenting on other markets’ governance and listing requirements, as well as in their direct engagement with companies. The UK’s reputation for high quality listing and governance standards and resultant overseas investor confidence is both a competitive advantage and a positive differentiator for the UK market.ICGN has cautioned against FCA proposals to replace the current ‘standard’ and ‘premium’ segments with a single listing category, to remove shareholder votes prior to significant transactions and related party transactions, and allow dual-class shares with very few investor protection safeguards. ICGN contends that these proposals will expose investors to undue risk, with potentially significant implications for underlying beneficiaries including pensioners, insurance, and retail investors’ savings.
“At a time when regulators around the world are encouraging investors to play a greater, more responsible, stewardship role in promoting the long-term success of companies, weakening their voting rights will have the opposite effect by inhibiting investor influence. ICGN and investors individually have responded to the FCA’s consultations, but we fear that our concerns are not being heard.”
-ICGN’s Global Policy Director, Séverine Neervoort
ICGN’s Statement on High Standards of Corporate Governance as Pre-requisites for UK Capital Market Competitiveness and GrowthCo-signatories are as follows:Allianz Global Investors GmbH, Matt Christensen, Global Head Sustainable & Impact InvestingAccident Compensation Corporation, Mark Cross, Chair, Board Investment CommitteeAMEC, Fabio Coelho, Chief Executive OfficerAPG Asset Management, Claudia Kruse, Managing Director, Responsible Investment StrategyAssogestioni, Fabio Galli, Director GeneralAustralian Council of Superannuation Investors (ACSI), Louise Davidson, Chief Executive OfficerAustralianSuper, Andrew Gray, Head of ESG & StewardshipAXA Investment Managers, Gilles Moëc, Head of ResearchBaillie Gifford, Sam Rooke, Manager (ESG - Policy, Projects and Regulation)Boston Common Asset Management, Lauren Compere, Managing DirectorBritish Columbia Investment Management Corporation (BCI), Daniel Garant, Executive Vice President and Global Head, Public MarketsBrunel Pension Partnership, Faith Ward, Chief Responsible Investment OfficerCalifornia Public Employees' Retirement System (CalPERS), Marcie Frost, Chief Executive OfficerCalifornia State Teachers Retirement System (CalSTRS), Aeisha Mastagni, Senior Portfolio MangerCanadian Coalition for Good Governance, Catherine McCall, Chief Executive OfficerChurch of England Pensions Board, John Ball, Chief Executive OfficerColumbia Threadneedle Investments, Claudia Wearmouth, Head of Responsible InvestmentConnor, Clark & Lunn Investment Management Ltd., Martin Gerber, President and Chief Investment OfficerCouncil of Institutional Investors (CII), Amy Borrus, Executive DirectorDowning LLP, Roger Lewis, Head of Sustainability and Responsible InvestmentEOS at Federated Hermes Limited, Bruce Duguid, Head of StewardshipEtica Funds - Responsible Investments, Aldo Bonati, Stewardship and ESG Networks ManagerEumedion, Rients Abma, Executive DirectorGlobal Alpha Capital Management Ltd., Qing Ji, Portfolio Manager, Board DirectorImpax Asset Management, Lisa Beauvilain, Global Head of Sustainability & StewardshipInterfaith Center on Corporate Responsibility, Josh Zinner, Chief Executive OfficerInvestor Alliance for Human Rights, Anita Dorett, DirectorJupiter Asset Management, Kiran Nandra, Head of EquitiesLondon Pensions Fund Authority, Robert Branagh, Chief Executive OfficerMerseyside Pension Fund, Peter Wallach, DirectorMint Asset Management, Rachel Tinkler, Head of Responsible InvestmentNest, Diandra Soobiah, Head of Responsible InvestmentNew Zealand Super Fund, Paula Steed, Chief Executive Officer (acting)Newton Investment Management Limited, Therese Niklasson, Global Head of Sustainable InvestmentNILGOSC – Local Government Pension Scheme (Northern Ireland), David Murphy, Chief ExecutiveNorges Bank Investment Management, Carine Smith Ihenacho, Chief Governance and Compliance OfficerNorthern LGPS, Councillor Gerald Cooney, ChairPensions and Lifetime Savings Association (PLSA), Nigel Peaple, Director of Policy & AdvocacyPeople's Partnership, Leanne Clements, Head of Responsible InvestmentPermodalan Nasional Berhad, Ahmad Zulqarnain Che On, President & Group Chief ExecutivePGGM, Gerard Fehrenbach, Responsible InvestmentPrinciples for Responsible Investment (PRI), David Atkin, Chief Executive OfficerRailpen, Michael Marshall, Director of Investment Risk and Sustainable OwnershipRobeco, Carola van Lamoen, Head of Sustainable InvestingScottish Widows, Vicky Grinnell-Wright, Head ESG and Interim Head of Responsible InvestmentTD Global Investment Solutions (TDGIS), Priti Shokeen, Managing Director, Head of ESG Research and Engagement, TD Asset ManagementUAW Retiree Medical Benefits Trust, Hershel Harper, Chief Investment OfficerUniversity Pension Plan, Aaron Bennett, Chief Investment OfficerUSS, Sandra Carlisle, Head of Responsible InvestmentWalter Scott, Jane Henderson, Managing DirectorWest Yorkshire Pension Fund, Euan Miller, Managing DirectorWoodsford, Steven Friel, Chief Executive Officer
All opinions expressed are those of the author and/or quoted sources. investESG.eu is an independent and neutral platform dedicated to generating debate around ESG investing topics.