Plea for investment industry to join battle against global poverty

INSTITUTIONAL investors are being urged to develop investment policies that will help tackle poverty.

The recommendation is the result of a two-year initiative involving more than 80 influential investors across Europe and the United States, including Aviva Investors, Crdit Agricole Cheuvreux, Henderson Global Investors and Calvert Investments.

It says the investor community pays little attention to the issue because of a lack of demand and oversight by asset owners, an overwhelming focus on short-term financial performance and weak transparency in the investment sector.

It also highlights the absence of clear agreed standards on poverty and development-related issues.

The report, Better Returns In A Better World, produced for Oxfam Scotland, makes a number of recommendations including a more active role in ensuring that companies improve their performance and the way they report on poverty.

Bob Humphreys, Oxfam's director of finance, said: "With Edinburgh the UK's biggest financial centre after London, Scottish investment houses have a critical role to play in the fight against poverty.

"It's not just a question of morals but smart business as their investments are increasingly exposed to emerging markets and the challenges they face."

Rory Sullivan, the lead investor on the project and co-author of the report, said: "The recommendations made in this report set the agenda for the next three years for the responsible investment industry. The industry's credibility will stand or fall on its willingness and ability to deliver."

Julie McDowell, head of sustainable and responsible investment at Standard Life Investments, who is hosting the report launch tomorrow, said: "As a long-term investor with a strong commitment to responsible investing, we welcome Oxfam's focus on this issue.

"Standard Life Investments supports initiatives to promote good stewardship and greater openness in the investment management industry. We encourage the companies we invest in to move to best practice standards on environmental, social and governance issues as we believe this is in the best interests of employees, suppliers, customers and shareholders, as well as society as a whole."

Owen Kelly, chief executive of Scottish Financial Enterprise, said: "Scotland is an international leader in investment management. This is an opportunity to consider how that expertise can contribute to poverty reduction."