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ROUND -TABLE III: RESPONSIBLE INVESTMENT

(Synthesis by Pascale MORAND)

 

International meeting, Geneva March 30-31, 2001,

Moderator:  Pascale MORAND

 

INTRODUCTION

 

The responsible investment articulates around three axes:

1. the selection founded on social, ethical and environmental criterias entering in the composition of the securities portfolio

2. the solidarity in the investment consisting to provide funds to people who don't have access at the conventional institutions of credit, using the expedient of development banks communal, of cooperative societies of credit or credit fund or venture capital

3. the responsible shareholding, or the exercise of the rights to vote associated to the detention of actions of societies.

These various aspects have been evoked in the discussion in order to surround the potential and the limits of the responsible investment better in the promotion of the common good. 

 

FOUNDATIONS OF THE PHILOSOPHY OF THE RESPONSIBILITY

 

It was very important to recall, as Luca Pattaroni (University of Geneva) made in the introduction of the debate, that all power has for counterpart a responsibility. The ethics of the responsibility doesn't amount solely to accept the rules of the game fixed in the law, but it implies a worry of the consequences of the exercise of a power - the research of the individual interest by the slant of an investment aiming a profit - on others.  This ethics applies of various manners in the responsible investment, either by the exclusion of some sectors, either by a politics of dialogue with the enterprises whose stocks compose the portfolios. One of the limits of the investment based on the simple exclusion is " to appropriate in an undue manner the definition of the common good" or, in the terms of Jacques Generous, to create a "market of the values".

 

This objection finds an echo in the exposition of Pierre Weiss (Adviser at the Federation des Syndicats Patronaux), that wonders on the dangers - "monopoly of the vote of politically correct investors "or" dogmatism" - that represents the constitution of alliances of committed shareholders.

 

THE QUESTION OF THE RESPONSIBILITY ARISES DIFFERENTLY FOR THE INVESTMENTS to promote new economic activities AND THE INVESTMENTS to make frutify a capital

 

It is important to know, specify Edouard Dommen (Actares), that the question of ethics arises differently depending on whether it was about an investment to promote new economic activities or of an investment to make fructify a capital.  The English terminology, made no distinction, the two being designated by the term of "investment ".  In the practice, this distinction is translated, for example, by the refusal of some alternative banks to acquire the actions, the stock activities being to their eyes disconnected of the economic realities. Concerning the shareholding, the exercise of a responsible engagement, well implanted in the Anglo-Saxon world, can be hindered by legal obstacles - in Switzerland, for example, we are far from the principle of an action = a vote.

 

HOW OPÉRATIONNALISER THE CONCEPT OF THE COMMON GOOD IN THE HOLD OF DECISION

 

In order to try to set the concept of the common good operational to the enterprise, Helen Alford (Pontifica Universitŕ San Tommaso) proposes a simple model permitting to establish a hierarchy of the objectives in the decision making.  The research of the structural goods (fundational) as the profit must be conjugated to the realization of "excellent goods", that means the development of the person and the community.  On the other hand, a balance between the shared goods and the particular goods must be found.  The research of the common good finally requires a discernment, in the level of goods produced by the enterprise, between those that are "obvious" and those that are "true" depending on whether they contribute or no to the development of the human person.

 

EFFECTS OF THE RESPONSIBLE INVESTMENT ON THE ENTERPRISES

 

In spite of the present obstacles for the responsible investments and a growing shareholding activism, is difficult to value the real effect of it on the social and environmental performance of the enterprises. France, for example, saw during these last two years a strong progression of the responsible funds, grace notably to the key role played by the agency of notification ARESE.  Martial Cozette (French Center of information on the enterprises, France) remark however that the quantitative information collected on the big enterprises are even incomplete and the portfolio managers are often little aware of the questions of sustainable development.  However these are the questions on which lean the assessment criterias used in the analyses of enterprises. 

 

To appreciate the effect of the responsible investment on the behavior of the enterprises is especially difficult when they are implanted in the emerging countries, as Victor Quintana (Equipo Pueblo, Mexico) reminds it describing the conditions of working in some multinationals in his country. The famous cases of Shell, Nike, the Gap and Triumph indicate that in a globalized society where information circulates freely, it will be more and more difficult for the societies to conceal some violations concerning human rights, environment and the work of the children.  Nevertheless, these cases are the trees that hide the forest and Rudolf Müller (Secretariat of state to the economy, Switzerland) observes that the countries that make a keen competition to attract multinationals often make it to strong price to the tax system, the handling conditions and the pollution.

 

CONCLUSION AND FOLLOWING STAGES

 

The responsible investment is a important component of the set of the impulses that is necessary to put the investments system and financial investments to the service of the common good. Nevertheless it doesn't replace the indispensable democratic process by which the society must make of a real political choice an objective. 

 

The observatory of the Finance can contribute to establish the bases of a collective gait elaborating, in view of the "World Assembly of the Citizens for a Responsible, Plural and United World" that will be held in Lille in December 2001, of the propositions permitting to answer the following questions,:

- Them what principles are susceptible to found a global gait aiming to orient the investment toward the common good?

- What vehicle would be able to best formulate these principles (chart, quotation criterias, international conduct code, etc.)?