According to a poll conducted by EY at last week’s 2016 Conference on Inclusive Capitalism, 75% of 126 respondents regarded as some of the world’s most influential leaders in finance and business agree that greater transparency and disclosure about long-term plans to all shareholders would have the greatest potential to ensure that activist investors create long-term value for all shareholders.
The participants at the conference organized by The Coalition for Inclusive Capitalism – which together represent almost US$40 trillion in assets under management – were invited to share their perspectives around long-term value creation by answering a set of six live questions.
When asked what policy changes will generate the greatest urgency in creating more inclusive capitalism, 44% cited regulations enforcing long-termism, with 33% selecting fiscal stimulus and 21% progressive taxation.
“The Inclusive Capitalism movement recognizes that we need to act with a shared direction towards driving investments that create long-term value, not merely short term profits,” says Mark Weinberger, EY Global Chairman and CEO.
“Long-term value will be sustainable if it benefits not just shareholders, but a wide range of stakeholders – from the people we employ to the communities where we operate. Our findings show a building consensus around who needs to engage – and what issues need to be focused on – to make capitalism more equitable, sustainable and inclusive.”
Polled on the most important role that asset owners can play in promoting long-termism and inclusive growth, half of respondents (50%) agree on compensating investment managers according to long-term metrics. When asked who they consider the most important voice in driving long-termism inside a company, 59% pointed to management, while 30% cited board of directors.
When it comes to the most important investment to improve the status of workers, 72% cited broader skills training initiatives.
“We are pleased to share the findings from the Conference on Inclusive Capitalism poll, presented by EY, with the worldwide business community and the public,” says Lady Lynn Forester de Rothschild, the CEO and founder of the Coalition for Inclusive Capitalism. “These results track the current pulse of the Inclusive Capitalism movement and outline key steps to advance business practices aligned with long-term value creation.”