Harnessing Stewardship Codes

For Long-term Value Creation

Harnessing Stewardship Codes

Recent years have seen the emergence — and proliferation — of a new kind of governance document for investors: stewardship codes. These codes can help investors optimize long-term value creation for beneficiaries by highlighting effective ways of communicating with investee companies and laying out clear guidelines for rigorous monitoring.

Twenty-four stewardship codes have been introduced around the world, mostly since 2016. The bulk of these codes are country-specific, although the International Corporate Governance Network (ICGN), the Organization for Economic Cooperation and Development (OECD), and the European Union (EU) have developed multinational stewardship principles or codes.

Stewardship codes are chiefly designed for institutional investors. While they occasionally take the form of binding regulation, more often they involve voluntary standards. Nearly half of stewardship codes are assembled by national and supranational organizations, while the rest are issued by investors or private industry participants.

Properly organized, stewardship codes can be a vital tool for promoting long-term thinking across the value chain, guiding investors and investees toward behaviors that help them see past short-term market vicissitudes and focus on longer-term measures of success. Investors can also create their own stewardship principles to emphasize the issues that are important to their particular organization and its brand.

Building on the extensive work carried out by ICGN, the Council of Institutional Investors (CII), and others, our focus is to ensure that stewardship codes around the world are targeted to advance long-term thinking in financial markets. To advance this goal of improving long-term value creation, FCLTGlobal has assembled a suite of materials for investors, investees, and regulators.

Note: The UK’s Financial Reporting Council (FRC), an independent regulator, has revised the UK Stewardship Code 2020, which takes effect on 1 January 2020. It is a significant and ambitious revision to the 2012 edition of the code that sets high expectations on UK institutional investors and service providers. To facilitate what this will mean for implementation, please see the differences between the two codes highlighted in the attached chart.  


Bhakti Mirchandani, Lead Author

Victoria Tellez

Steve Boxer

Evan Horowitz


These materials benefited from the insights and advice of a network of thought leaders drawn from FCLTGlobal's members. The final documents are our own, and the views expressed here do not necessarily represent the views of FCLTGlobal's members. We would like to thank and acknowledge the contributions of everyone who participated in the conversations and working groups that informed our research.

Jonathan Bailey, Neuberger Berman Loree M. Gourley, EY Marina Mnatsakanian, Kempen Capital Management
Mark Besca, EY Marianne Harper Gow, Baillie Gifford Sabastian Niles, Wachtell, Lipton, Rosen & Katz
Neri Bukspan, EY Lysanne Gray, Unilever Anastasia Petraki, Schroders
Mike Cantara, MFS Investment Management Sarah Greenberg, MSCI Joel Posters, Future Fund
Kim Chong, Hong Kong Monetary Authority Ingrid Holmes, Hermes Investment Management Ted Roosevelt, Barclays
Yolanda Courtines, Wellington Management Company Randall Hopkins, Nasdaq Saul Rubin, Wellington Management Company
George Dallas, ICGN Nadine Kawkabani, MFS Investment Management Carolina San Martin, Wellington Management Company
Rani Doyle, EY Conor Kehoe, McKinsey & Company Howard Sherman, MSCI
Bruce Duguid, Hermes Investment Management Maria Kepa, EY Eric Shostal, BlackRock
Alex Edmans, London Business School Rakhi Kumar, State Street Global Advisors Jakob Skafte, ATP
Fiona Ellard, The Investor Forum Kate Leung, Hong Kong Monetary Authority Margaret Therrien, MFS Investment Management
Mike Everett, Aberdeen Asset Management Jed Lynch, Barclays Harald Walkate, Natixis
Mark Fisher, EY Ted McHugh, Edelman Jake Walko, Neuberger Berman
Gassia Fox, BlackRock George Mason, MFS Investment Management Ali Weiner, State Street Global Advisors
Carol Geremia, MFS Investment Management Terry Mellish, Natixis