A fledgling initiative focused on corporate engagement in Europe is inviting other institutional investors to collaborate, as it ramps up its work on tax, human rights and climate change.
Shareholders for Change, which plans to focus on all asset classes, was launched last December by seven values-based investors from Italy, Germany, France, Spain and Austria, with €22bn of combined assets. Its focus is on engagement with European companies on the three ESG topics, but particularly on tax issues.
“We’re keen to attract other members,” explained Tommy Piemonte, Head of Sustainability Research at German Catholic church bank Bank fur Kirche und Caritas – one of the founding members. He added that, although SfC was “too immature to grow too fast too quickly”, members were in dialogue with nine other investors around Europe about joining.
“You have to be a values-based investor, because we have a Charter of Values that members must adhere to. So BlackRock, Goldman Sachs, Deutsche Bank and those big players that are starting to have some interest in ESG will never be able to be members.”
The initiative is aimed at small- and medium- investment houses and asset owners in Europe.“It can be really difficult to do direct engagement if you’re a small or middle investor – you have to go through a service provider because on your own you’re too small to get access to companies and you might not have the resources. But together, many small- and middle-sized investors can share the workload and use scale to gain better access.”
SfC has already engaged Inditex and Engie on tax issues, and plans to public research on another big firm later this year.
Tax will be the main focus, but the initiative will look at climate change and human rights too. It published a summary of its first six months of engagement in June.
“Other investors and initiatives are tending to put their focus on risk-only issues, but we want to be broader than that, because the ethical side is also important – and the two are often linked,” said Piemonte, adding that SfC will also do engagement where there is no perceived material financial risk, but a significant ethical issue.
“We will use the whole engagement toolbox: dialogues, voting, speaking at AGMs, all of it,” said Piemonte.
For more information on the initiative and a full list of current members, see RI’s analysis.
For details of RI’s Ethical Finance Conference, taking place in the UK later this year, see here