The Shareholder Commons applies a PRE-COMPETITIVE systems approach to corporate purpose and social responsibility.
While today’s ESG (“environmental, social and governance”) initiatives focus on improving individual companies, we believe that in a free market system, investors and companies must work collectively to establish universally applicable minimum standards in order to preserve essential social and environmental systems.
The Shareholder Commons will advocate for an economic system where companies are expected to forgo profits made from the exploitation of vulnerable communities and depleting common resources, and instead focus on profits from innovative value creation.
Leveling the playing field
The Shareholders Commons seeks to catalyze a movement of universal owners to identify and implement minimum acceptable standards of corporate conduct that all businesses must meet before pursuing profit.
The Shareholder Commons will develop and advocate for public policies that accommodate the needs of universal owners.
Speaking on behalf of the universal owner in the courts, The Shareholder Commons will use litigation to further systems change and stop rewarding irresponsible companies with high margins and cheap capital.
TSC is excited to announce the publication of a full set of tools for investors who are ready to use their shareholder rights to protect critical social and environmental systems. System stewardship is the most effective strategy available to diversified shareholders who want to optimize their portfolio returns.
This suite of tools will provide asset owners with principles to adopt and follow throughout the organization, references to important legal guidance, specific language for proxy-voting guidelines, and advisor mandates and other materials that provide a turnkey solution that investors can easily customize. These open-source materials are available on our website and will be updated as we receive feedback.
Investors have already developed highly effective tools to press companies to optimize their returns. These tools include engagement on social and environmental issues that is designed to increase returns and decrease enterprise risk at individual companies. But the greatest threat to the long-term returns of diversified investors does not come from the failure of individual companies to optimize their own returns, but from the trillions of dollars in social and environmental costs businesses externalize annually. Diversified shareholders do internalize these costs, and the company-first lens of current shareholder engagement cannot address company behavior that undermines long-term, broad economic health. Investors need tools to close this gap.
Certain elements are essential to system stewardship: a legal foundation, an economic foundation, a clear internal mandate, external mandates, and stewardship practices.
Together, we're embarking on a fundamental transformation of our financial system...