Sir, I am most encouraged to read that institutional investors are now calling for a quality kite mark in line with the recent recommendation by Tomorrow’s Company (“ Large fund groups call for ‘kite mark’ of quality”, FTfm, February 16).
The article is accompanied by a picture of a cyclist wearing a safety helmet, a product that already enjoys kite mark status.
This is appropriate. As a retail investor, I would like to be able to choose investment products in which I can have confidence. That means products whose investment managers are good stewards, electing the right directors, intervening to hold the board to account, keeping remuneration in line with long-term value creation, and making sure that the board are getting the right balance between performance today and investment for the future.
Until now too many people have made the mistake of confusing good stewardship with ethical or socially responsible investment. It is time to end this confusion. While I do care about the conditions in which my cycle helmet is made, my first concern is that it will do the job for which it was designed and protect my head when I crash. Stewardship is about underpinning the overall investment performance of my portfolio, and managing the most obvious risks of value destruction.
London SW1, UK
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