David Wood, “The Current Limits and Potential Role of Institutional Investment Culture and Fiduciary Responsibility.” Read here.
David Wood, IRI Director, contributed to the World Economic Forum (WEF) report, From Ideas to Practice, Pilots to Strategy: Practical Solutions and Actionable Insights on How to Do Impact Investing, with his article, “The Current Limits and Potential Role of Institutional Investment Culture and Fiduciary Responsibility.” This piece discusses the complex role fiduciary duty plays in impact investing, serving as both a hindrance and driver to responsible investing practices. He argues that education and understanding is key – understanding of both the complex role of fiduciary duty and the long-term implications of environmental, social, and governance (ESG) analysis. Better addressing both the challenges and opportunities these aspects of institutional investing can bring about can aid a reorientation towards long-term wealth creation.
David Wood, Response to “When Can Impact Investing Create Real Impact?” Read here.
David Wood, Director of the IRI, contributes to the Stanford Social Innovation Review in their ongoing discussion of the future of impact investing, responding to an article by Paul Brest and Kelly Born, found here. As the field gains popularity, debates of its efficacy to achieve social impact and promised competitive returns are all the more prevalent. While David agrees that impact investments are not the solution for all social issues or suitable for all investors, he disagrees with the notion posited by Brest and Born that impact investors cannot play a role in the public equities asset class. Citing the 2008 financial crisis as a demonstrative instance of the public equities market emphasis on ‘short-term speculative strategies,’ David argues that impact investors can play an important role in balancing the asset class by investing towards long-term wealth creation. Read David’s full response here.
Jay Youngdahl. “The Time Has Come For a Sustainable Theory of Fiduciary Duty In Investment.” Hofstra Labor & Employment Law Journal (29) 2011: 115-139. Read here.
While the rigorous mandate to conform to legal fiduciary duties has been a long-standing standard of trust law, the definitional content of the investment function of this duty has been in constant evolution. A close relationship exists between the strictures of the investment duty and changing societal conditions. Thus, adherence to fiduciary duty is ironclad, but the substance of the investment duty has always been malleable. Given the ethical and financial gyrations of the recent past, as well as the crisis in retirement security of America‘s workforce, it is time to reexamine the composition of the fiduciary duty regarding the investment function.
Jeffrey Cohen, Lori Holder-Webb, Leda Nath, David Wood. “Retail Investors’ Perceptions of the Decision-Usefulness of Economic Performance, Governance, and Corporate Social Responsibility Disclosures.” Behavioral Research In Accounting (23:1) 2011: 109-129. Read here.
Academic literature and the business press have placed increased attention on the corporate disclosure of nonfinancial information. This study uses a survey of 750 retail investors to examine perceptions about indicators of economic performance, corporate governance policies and performance, and corporate social responsibility. Survey results indicate that retail investors currently are most concerned with economic performance information, followed by governance, and then corporate social responsibility information.