Companies need to focus on their stakeholders

Companies are often being challenged to understand better the social contract they hold with their stakeholders, from employees and investors, to local communities and global consumers, according to Martin Currie’s Annual Stewardship Report for 2019.

Also, there has been fundamental shifts in the perception and accountability of companies as climate-related change reached a tipping point and the companies would need to adjust to increasing climate-related regulations, the study said.

On top of that, the companies needed to embrace shifting demographic values as they had a growing impact on the business, with the growing influence of millennials as future consumers, investors and decision-makers.

Similarly, the rise of disruptive technologies, including collaborative robots, drones, artificial intelligence (AI), autonomous vehicles and machine-learning algorithms would also challenge future human capital.

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This would in turn make asset managers working harder to instil more sustainability concept and stewardship should be the pathway for this, the firm said.

“Expectation is building in this regard – through increasing regulation on asset owners to integrate sustainability factors in their mandates as well as beneficiaries progressively demanding this,” the study said.

“Asset managers would therefore be unwise to consider stewardship as just a short-term fad or a boxticking exercise.”