Document summary
Public policy critically affects the ability of long-term investors to generate sustainable returns and create value. Public policy also affects the sustainability and stability of financial markets, as well as social, environmental and economic systems. Policy engagement by long-term investors is therefore a natural and necessary extension of an investor’s responsibilities and fiduciary duties to the interests of beneficiaries. The importance of such engagement has grown over recent years but barriers remain.
Based on interviews with an international group of investors and policymakers, this report provides the first analysis of the 'why, what and how' of policy engagement by investors to build a sustainable financial system. It offers practical, effective recommendations, proposing a five-step approach, the 5c’s, to improve the integration of investor perspectives on environmental, social and governance (ESG) factors in the public policymaking process.