Between stakeholders and shareholders: Pension funds and labour solidarity in the age of sustainability
Articolo
Data di Pubblicazione:
2023
Citazione:
Between stakeholders and shareholders: Pension funds and labour solidarity in the age of sustainability / P. Tomassetti. - In: EUROPEAN LABOUR LAW JOURNAL. - ISSN 2031-9525. - 14:1(2023), pp. 73-91. [10.1177/20319525221140422]
Abstract:
This article investigates the contribution of pension funds in harnessing the power of finance to
achieve social and environmental objectives. After reviewing and discussing the potential and
main hurdles to pension fund engagement in Socially Responsible Investment (SRI), the common
law approach to shareholder activism is contrasted with the EU law on pension funds and on
sustainability-related disclosures and taxonomies. Unlike the US and other common law jurisdictions,
where the duties regarding retirement institutions are derived from trust law, EU rules on
pension funds governance and investment policies are generally grounded on the more relaxed
duties of corporate and financial law. On the one hand, this makes it easier for pension funds
to consider the potential impact of environmental, social and governance factors (ESG) on investment
decisions. On the other, social and environmental concerns are functionalised for economic
purposes, thus reducing the possibilities for a more critical and strategical use of pension funds’
financial power by activists. This also explains why, despite being often participated in by trade
unions, the existing governance of pension funds in Europe tends to outsource the management
of investment policies to financial operators. While this takes responsibility away from the governing
boards of pension funds in terms of their legal duties, the combination of decentralisation and
the outsourcing of investment management undermines the possibility for unions to engage in
shareholder activism, and to strike a balance between the position of workers as stakeholders
and the position of workers as shareholders.
Tipologia IRIS:
01 - Articolo su periodico
Keywords:
pension funds; shareholder activism; socially responsible investments; ESG; trade unions
Elenco autori:
P. Tomassetti
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