The fifth principle states that signatories will “work together to enhance our effectiveness in implementing the Principles.”
In any emerging trend, it is often beneficial that disparate but agreeing voices collaborate to increase the take up of the trend. This is especially true if the emerging trend runs counter to the prevailing mood. Responsible investment had a boost with the Brundtland Report on sustainable development, but has a far older heritage from the abolitionists during the slave trade debates.
Individuals can often come across as mavericks or eccentrics unless they find a similar group of people who share their views and are willing to share ideas on how to make a thought into reality. In business and investment circles, those who share views can often operate in competitors or in non-corporate settings. It is therefore vital that parochial interests are set aside, confidences respected and the common goal kept in focus.
Often an individual who sets themselves against an irresponsible corporate culture can feel isolated or question their own judgment. That is unless they find, and are supported by, like-minded souls who may have more experience, evidence and wise counsel to offer in the debate. Working together in initiatives and networks provides that support.
The trend towards responsible investment is clear. This is no longer the preserve of the religious or the deeply ethical. It has a strong foundation in practical ideas about sustainability and concerns about the last five years.
Scandals and failures in financial services and the financial crash of 2007 have created an environment for people to question irresponsible behaviour. MPs expense-fiddling, phone hacking, police bribing and various ecological disasters have brought politicians, the media and business into even greater focus.
The internet provides the information and social media has created the means for people to organise in opposition to any interest they disagree with. At the more radical end, organisations like Anonymous, Wikileaks and various anti-capitalist groups represent a clear and present danger to corporations who are unwilling to mend their irresponsible ways. This pressure will inexorably grow as a highly internet-literate generation sees fewer opportunities for them in the current settlement.
Working together to demonstrate how the virtuous cycle of responsible investment and responsible business can benefit the environment, society and prosperity, might be what is needed to restore capitalism’s reputation.
There is no environmental or societal problem that we cannot solve collectively and we face some massive challenges in both areas. Business and investment must play its role and work together to address these challenges.
Tomorrow we will cover the final principle that covers reporting.