I was particularly impressed by the work that John and colleagues are doing under the aegis of "The Asset Owners Disclosure Project" (AODP). This is "an independent not-for-profit global organisation whose objective is to protect members' retirement savings from the risks posed by climate change by improving the level of disclosure and industry best practice." It is worth looking at the interview with John at the Festival of Dangerous Ideas in Sydney, Australia, located on the project website where he discusses "how your pension is destroying the planet." I sincerely hope his work contributes to accelerated growth of the divestment movement.
The AODP has created an index "following information requests to the world’s 1000 largest asset owners including over 800 pension funds, 80 insurance companies, 50 sovereign wealth funds and 30 foundations/endowments. Together, they manage more than US$70 trillion". The index supports the aim of AODP to "help funds to redress the huge imbalance in their investments between high-carbon assets (50-60% of a portfolio) and low-carbon assets (typically less than 2%) and realign the investment chain to adopt long-term investment practices".
What is particularly impressive is that John has understood the science of climate change for a long time and has been a consistent advocate for innovation and change that moves us collectively towards a post-carbon society. Of course this is yet another commitment that places him out of sympathy with the current Australian government, who have clearly been shown at the recent G20 meeting to be out of step with the rest of the world.
Since becoming aware of the AODP project I have wondered if those involved in the project and those who support its aims are also aware of some broader systemic issues that also warrant transformation? For example, Simon Caulkin, a former management editor of the Observer (UK), has been one of the most consistent critics of the distortions in management understandings and practices that now seem to be taken for granted. In a recent article he explains how these insights emerged for him:
“….management didn’t do what it said on the tin, and now, knitting together what I had sensed before, I thought I could see why, although I struggled to express it.
“Starting in the 1980s, elite business schools began teaching future managers and investors that the only metric that matters is shareholder value. This was a dramatic change, as throughout most of its history American capitalism had operated on a stakeholder model in which managers sought to balance the interests of multiple stakeholders, including investors, customers, employees, and local communities. The shareholder-value revolution created a short-term quarterly earnings culture, a bias toward sweating assets versus building them, a view that employees are a cost to be managed rather than human capital to be invested in, and a love of debt. It also made CEOs and their top managers immensely rich by showering them with stock options. While CEO compensation shot upwards, corporate debt levels climbed, R&D spending dropped, and employee churn and temporary work rose.”
John Menadue, and a series of posting by Ian McAuley explore some of these broader systemic issues that raise serious concerns about the status and institutions of contemporary capitalism.