Yahoo Finance Church fund chief says coronavirus will renew calls for responsible capitalism
The ethical investment chief at the Church of England’s investment arm has said the sacrifices made to tackle the coronavirus outbreak will renew calls for “responsible capitalism” and force companies to reconsider issues such as excessive executive pay.
Edward Mason, the head of responsible investment for the Church Commissioners, said that while the coronavirus was overwhelming the news agenda it was likely to refocus minds on the collective good and how companies need to play their part.
“Some of the post-financial crisis themes we’ve seen around corporate tax, not having excessive executive remuneration, treating people fairly, treating staff fairly – I think all these issues are already part of the public discourse on coronavirus. And I think it’s only going to increase the sort of momentum behind responsible capitalism, because everyone’s making sacrifices at the moment,” he told the Guardian.
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Mason said the Church Commissioners, which manage an £8.3bn ethical fund on behalf of the Church of England, would also expect firms that receive government support during the Covid-19 outbreak to consider what they could do in return.
“If society has been good to a company, it’s incumbent on that company to be a responsible citizen in society and to be generous back. That’s very much part of our philosophy as a church: mutual generosity and intentions towards the common good,” Mason said.
Last week the High Pay Centre, a thinktank, called for any bailouts during the coronavirus outbreak to come with social and environment conditions including a cap on chief executive pay at 10 times that of the company’s median worker.
In recent years the Church of England has used its shareholdings to criticise companies such as Sports Direct over poor working conditions and BP over its carbon footprint. In the US it has taken aim at Amazon for paying “almost nothing” in taxes and ExxonMobil for failing to disclose emissions reduction targets.
It is now pushing Barclays on its climate record. The Church Commissioners have joined a list of influential investors backing a shareholder resolution calling for Barclays to phase out lending to fossil fuel companies. A vote on the measure will take place at the bank’s annual general meeting on 7 May.
Barclays has been the top European financier of fossil fuels in the last four years, according to figures compiled by campaigners including the Rainforest Action Network. They also showed that the London-based bank was the largest financier of Arctic oil and gas last year.
Mason said he expected companies to make further progress in battling the climate crisis despite the coronavirus outbreak. “We’re exceptionally key that this should remain on the agenda” he said. “Climate change is by far our highest priority, it is the biggest ethical issue that concerns our stakeholders in the wider church, and also poses the greatest systemic risk to our portfolio.”
This year the Church Commissioners will start assessing whether companies in their investment portfolio – including oil producers and airlines – are aligned with the Paris climate agreement, which aims to keep global temperatures from rising by more than 2C.
The investment arm, which says it aims to engage with polluters in an effort to change their behaviour, has pledged to divest from laggard companies by 2023. The C of E holds stakes in oil firms including Shell, BP and Exxon Mobil.
“There’s a lot resting on companies and we’re hopeful that companies will rise to the challenge … and once the immediate crisis is over, we’ll be ready to challenge companies, as appropriate, as well,” Mason said.
