ImpactAlpha, January 26 — Today’s extreme levels of income inequality affect investments across all asset classes and economic and social stability more broadly. Some investors are tackling such systemic risks with what The Investment Integration Project, in Systemic Stewardship: Investing to Address Income Inequality, calls “advanced techniques,” including collective action, standards-setting and the strengthening of local systems. Some examples:
To help companies “ find a balance between controlling their tax bill and paying a fair share,” 11 major investors, including Bâtirente, MFS Investment Management, NEI Investments, RobecoSAM and Triodos Investment Management, worked with the Principles for Responsible Investors on a guide to engaging corporations on their tax responsibility.
CCLA Investment Management, one of the U.K.’s largest charity fund managers, convened Find it, Fix it, Prevent it, to mobilize the U.K. investors to work against modern-day slavery. The coalition of 56 supporters managing $10 trillion in assets, including Australian Super, Fidelity International, and Schroders is working on improved data disclosure and a rating tool to help investors tackle the issue.
The Heron Foundation, a private foundation focused on community economic development, used fixed-income loans and bonds, to build affordable housing in California’s San Joaquin Valley. “These two investments, especially when issued by governments to support non- profits, significantly promote the building of infrastructure and public goods,” according to the TIIP report.