The Shareholder Commons

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22 Feb 24
The Shareholder Commons
The Shareholder Commons
The Shareholder Commons

The Shareholder Commons

The Shareholder Commons’s (TSC) mission is to help diversified shareholders to reprioritise their activism to put social and environmental systems first. The organisation demonstrates that investors have the corporate governance tools to force substantive change at companies to improve human and ecological systems, and thus the economy and diversified shareholders’ returns. TSC does so by catalysing the development of shareholder-created guardrails: minimum rules of conduct that drive meaningful behaviour change that level the playing field for sustainable competition.

Overview

The Shareholder Commons (TSC) is an independent non-profit organisation that addresses social and environmental issues from the perspective of shareholders who diversify their investments to optimise risk and return.

‘A Legal Framework for Impact’ (LFI), the groundbreaking report published by Freshfields Bruckhaus Deringer in 2021, finds that investors should consider the impact of their activities and in many cases should take action to improve sustainability outcomes.

The report found that investors ought to engage in such actions when they support their financial goals, and are reasonably achievable. It showed that consideration of a company’s sustainability as it pertains to the entity’s value alone is insufficient, and investors may need to make difficult decisions to ensure that individual company practices do not threaten their portfolios. For instance, they may need to take action that negatively impacts the financial returns of one company for the benefit of the portfolio.

While the policy environment on this work is improving (in part due to the project work of the Generation Foundation with PRI and UNEP FI), the significant barrier to action is not policy, but the lack of investor tools and practices designed to put the findings of LFI into real-world investment practice.

TSC supports investors to consider systemic risks and prioritise stewardship toward social and environmental issues in order to protect their portfolios. They promote such concepts as ‘shareholder-created guardrails’: minimum rules of conduct for investors to drive behaviour change in their investee companies in order to protect the critical systems that undergird the economy, and the value of diversified portfolios.

Our grant will support the continuation of TSC’s work, which includes engaging and providing tools for investors on systems stewardship and more broadly socialising the research on investors’ obligations and opportunities with regards to sustainability impact.

Read more about The Shareholder Commons’ work on their website: theshareholdercommons.com.