Abstract
This contribution examines the connection between investor capitalism and sustainable investment. It will be observed in this article that investor capitalism has gone through a structural change. Individual investors have been replaced by funds. Financial service providers have emerged that assist investors in managing and holding investments. This development coincided and was arguably facilitated by the growth in workplace and personal pensions. Pensions are subsidised by the government through tax relief. This financial contribution of the government is justified on social policy grounds. But it has the effect that pension savers, who receive substantial return by saving tax, are deprived of a reason to take an interest in how their money is invested. This not only deprives the service providers assisting pension savers from oversight from their ultimate customers. It also can help to explain why pension savers do not actively select investment products but rely on the default settings suggested by their employers. If the government is serious about encouraging investor capitalism to bring about sustainable business it should start with its own financial contribution, which has coincided with the emergence of the current model of investor capitalism, and connect pension tax relief to sustainable investment practices.
Highlights
The aim of this contribution is to examine the connection between investor capitalism and sustainable business
Pensions are subsidised by the government through tax relief. This financial contribution of the government is justified on social policy grounds
It has the effect that pension savers, who receive substantial return by saving tax, are deprived of a reason to take an interest in how their money is invested
Summary
The aim of this contribution is to examine the connection between investor capitalism and sustainable business. – have emerged that assist investors in managing and holding investments This development coincided and was arguably facilitated by the growth in workplace and personal pensions. If the government is serious about encouraging investor capitalism to bring about sustainable business it should start with its own financial contribution, which has coincided with the emergence of the current model of investor capitalism, and connect pension tax relief to sustainable investment practices. 5 we will examine the role of the government as a regulator and as a financial investor and conclude with the suggestion that the government should fully appreciate its role in pension investments and design tax relief in a way that integrates sustainability criteria
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have