Metrics | Article
30 November 2017 - Research consistently proves that many of today’s corporate executives believe that short-term pressure is growing, that it is changing their business decisions and that of their companies, and that these changes are destroying value for their shareholders. There are many ways to stem the tide of corporate short-termism – one being moving away from quarterly earnings per share (EPS) guidance, which FCLTGlobal has recently contended to be an unneeded industry relic. Rather than issue such guidance, companies would be better off providing investors with a plan focused on...
Governance | Article
17 October 2017 - FCLTGlobal’s Sarah Williamson, CEO, and Matthew Leatherman, Director of Research, recently sat down with Ronald O’Hanley to discuss the importance of long-term investing and the role of the board in affecting long-term change. Ronald O’Hanley is President and CEO of State Street Global Advisors, the investment management arm of State Street Corporation and an FCLTGlobal member. Sarah Williamson: What does long-term investing mean in a State Street Global Advisors context? Ron O’Hanley: As the third-largest asset manager in the world, we manage roughly $2.6 trillion, of which about $1.5 trillion in...
Article
17 October 2017 - Over the past few weeks, FCLTGlobal and several of its Members met at forums in both London and Singapore that underscored the rising importance of long-term decision making to managers and investors internationally, and the rapidly growing desire for change. Our first stop was in Singapore to take part in the second annual Insights Forum, hosted by GIC, one of the world’s largest investment firms. The event brought together over 100 senior business leaders to weigh in on the theme “Asia’s evolving role in an uncertain...
Article
18 August 2017 - Over the past year, we have built on the work of the Focusing Capital on the Long Term Initiative to create a fully functional not-for-profit organization with an ambitious research agenda that is well underway. It has been an extremely busy and productive year, and we wanted to take this opportunity to highlight our progress and thank our members for their contributions to this important work. The highlights include: Research Launched our research agenda with member convenings and released two research reports and associated media with McKinsey: “Rising to the Challenge of Short-Termism,”...
Governance | Article
2 August 2017 - Matthew Leatherman, Director of Research at FCLTGlobal, speaks to Theresa Whitmarsh about her commitment to longer horizon investing, corporate governance and the importance of being challenged by your board. Theresa Whitmarsh is Executive Director of the Washington State Investment Board, one of the United States’ leading institutional investors managing over $103 billion of state pension, insurance, and private assets. ML: Thank you for being part of our series of interviews with executive leaders in the FCLTGlobal membership community. What does long-termism mean to WSIB? TW: We have about 43 percent of our...
Article
28 July 2017 - Schroders and FCLTGlobal recently hosted a discussion with leaders from across the investment management industry to discuss how to create a better long-term investment environment in Europe.
Earnings Guidance | Article
21 April 2017 - Impact of Reporting Frequency on UK Public Companies: Profs. Robert Pozen, Suresh Nallareddy, and Shivaram Rajgopal Weigh In The CFA Institute Research Foundation published a study examining the UK’s implementation of quarterly reporting requirements for public companies in 2007 – designed to foster increased transparency – and subsequent scrapping of these requirements seven years later in hopes of combatting perceived short-termism in UK equity markets and the misalignment of incentives throughout the investment chain. At FCLT Global, we are examining alternatives to quarterly or short-term guidance in an effort to...
Article
19 April 2017 - FCLTGlobal Director Matthew Leatherman recently joined the team from the North Carolina Department of State Treasurer where he served as Policy Director. Matthew discusses his reasons for joining FCLTGlobal and his mission to put top-down economic logic to the test… Q: Why did you decide to join FCLTGlobal, and what will you be working on? Working with FCLT Global was an easy decision for me. I had the opportunity, as part of the asset owner community, to watch the initiative gather momentum and then form into an organization. Throughout that...
Article
17 April 2017 - A new addition to the team, Ariel Babcock is an equity investment professional with over a decade of experience in the financial industry. We spoke to Ariel about her motivations for joining FCLT Global, and the goals she hopes to accomplish during her tenure. Q: Why did you decide to join FCLT Global, and what will you be working on? Over the course of my career in the investment industry I’ve frustratingly witnessed the swing toward shorter term capital allocation decisions (by both companies and investors) and the value...
Article
14 April 2017 - Matthew Brady is an exciting new addition to the FCLT Global team, passionate about driving practical change in the financial investments industry for increased efficiencies. We spoke to him about his background, motivations for joining FCLT, and what he determines as success for the organization. Q: Why did you decide to join FCLTGlobal, and what will you be working on? I joined FCLT because I have seen the detriments of short-termism and how it can perpetuate sub-optimal results. I wanted to be a part of a company that...
Article
10 April 2017 - Jonathan Bailey, Director of Research at FCLT Global, speaks to Else Bos about the practical steps asset owners should take to support sustainable long-term value creation. Else Bos is CEO of PGGM, a cooperative that provides services in the field of pension administration, communications, fiduciary advice and asset management to a range of Dutch clients. PGGM is perhaps best known for managing over € 180 billion in assets for PFZW, the second largest pension fund in the Netherlands. JB: Else, can you tell me a little about your path to becoming...
Article
17 March 2017 - Earlier this year, together with the McKinsey Global Institute, we co-authored an article in the Harvard Business Review, “Finally, Proof That Managing for the Long Term Pays Off.” Based on an analysis of 615 large and mid-cap U.S. publicly listed companies from 2001 to 2015, it highlighted the benefits to long-termism, including higher corporate earnings growth and overall financial performance, and a greater growth in job creation and GDP (a longer summary is available here). This generated much thoughtful discussion on the role of long-termism and economic growth from...