ESG, Fiduciary Duty & Addressing Externalities

Josh Zinner of ICCR & John Keenan of AFSCME

Video 2 of 3

On December 15, 2022, we spoke with Josh Zinner of ICCR and John Keenan of AFSCME to explore “CPR, Externalities & Fiduciary Duty: Why Investors are Concerned about Corporate Impacts on People & Planet.”

Investors are increasingly concerned about the impacts corporations have on people and the planet, and the risks these can create for businesses, investors, and beneficiaries. Institutional investors in particular worry about “externalities” that can undermine a firm’s financial performance or amplify systemic risks across all portfolios. Given these impacts, some investors view it as central to their fiduciary duty to engage more actively with portfolio companies, shaping both business operations and political influences to reduce externalities. Others argue that such strategies violate fiduciary duty, because they involve non-economic factors to investment decisions.

In this module, we explore:

• How are ICCR and AFSCME and others responding in light of that?
• Can you recap the current legal debate and recent developments on law firms being subpoenaed due to their guidance on ESG as violating fiduciary duty? Where do you come down and why?

The Corporate Political Responsibility Taskforce (CPRT)’s Expert Dialogues are in-depth, recorded conversations with academic experts, stakeholder advocates and business practitioners to provide our members and other CPR champions with the expertise and context they need to develop principled, proactive CPR strategies. We invite those interested in a constructive, non-partisan, principles-based discussion.

Josh Zinner is the CEO of the Interfaith Center on Corporate Responsibility (ICCR), a coalition of over 300 global institutional investors currently representing more than $4 trillion in managed assets. John Keenan is Corporate Governance Analyst with the American Federation of State, County and Municipal Employees (AFSCME).

The full transcript for this module is available here. 

Keywords:

#CorporatePoliticalResponsibility #ESG #CPR_Responsibility #EnterpriseRisk #Climate #SystemicRisk