Resources
We conduct original research on the causes of short-term business decisions and work to find practical solutions.
In the News
7 March 2018 - More than 150 corporate, investment and regulatory leaders last week issued a call to action intended to help the markets take a less short-term perspective. The gathering in New York, which included BlackRock CEO Larry Fink, Unilever CEO Paul Polman, McKinsey & Co CEO Dominic Barton and SEC chair Jay Clayton, featured discussions on how investors and issuers can work together to protect long-term shareholder value creation.
In the News
22 February 2018 - The call itself followed the standard format of these highly scripted events. Vincent A. Forlenza, Chairman and Chief Executive Officer, started the call by presenting an executive overview, which included an affirmation of the company’s long-term strategy, before delving into highlights from the quarter. He was followed by Christopher Reidy, Executive Vice President, Chief Financial Officer, and Chief Administrative Officer who discussed the company’s financial performance and provided a financial guidance update.
In the News
14 February 2018 - But CPPIB still has about 10 per cent of its assets handled by external managers in public market exposures. This style of investment management is not typically associated with the long term, so how the board works with those managers is important to maintaining a consistent long-horizon framework.
In the News
10 December 2017 - The Focusing Capital on the Long Term (FCLT) Global report released last week says the mandate rewrite would update a range of standard terms and conditions including fees, benchmarks and reporting to better align the relationship between asset owners and fund managers.
In the News
7 December 2017 - In a new report, FCLT Global, which advocates a long-term investment approach by pension funds and asset managers, provided 10 recommendations for setting up long-term investment mandates. The recommendations included replacing directly terminable contracts with five-year arrangements linked to a fee discount. Currently, the fee discount is often subject to the scale of the mandate. FCLT Global’s list also addressed the use of benchmarks that focused on the long term as a standard for absolute return funds.
In the News
6 December 2017 - The not-for-profit organization’s stated goal is to encourage investors, such as pension plans, to look at allocations through a longer-term lens. It brought together working groups of global institutional investors and asset managers to discuss what strategies are working, and ways to tailor investment mandates to bolster long-term success.
In the News
5 December 2017 - The FCLT paper, Institutional Investment Mandates: Anchors for Long Term Performance, includes a top-10 list of recommendations for long-term mandates that covers fees, benchmarks, the term of the contract and performance reporting. It gives investors ideas for changing behaviours to better inform long-term thinking; for example, changing the frame of reference of performance reporting, and flipping the standard practice of listing short-term results ahead of longer-term outcomes.
In the News
16 November 2017 - Earnings move markets. Last month, the Nasdaq enjoyed its biggest one-day gain in a year following blowout earnings from technology giants Amazon, Google and Microsoft. However, while earnings can highlight underlying economic trends, they can also obscure them. Earnings season is often dubbed cheating season, and for good reason. Every quarter, the vast majority of companies beat low-balled estimates. Not only that, companies can use all kinds of accounting tricks – both legal and illegal – to mislead investors.
In the News
12 October 2017 - A decade to the day since the precrisis peak of U.S. stocks, it has become easier and easier for investors to take a long-term view. Those who bought on the day the S&P 500 hit its top on Oct. 9, 2007, and held on through the subsequent panic and market collapse, have more than doubled their money, including dividends.
In the News
8 June 2017 - In a 2011 article, McKinsey & Company chief Dominic Barton called on his global counterparts to adopt a longer-term approach to business planning in the wake of the financial crisis of 2007-2008. Two years later, McKinsey and the Canadian Pension Plan Investment Board (CPPIB) conducted a study of more than 1,000 board members and CEOs, and found out how pervasive “quarterly capitalism” has become: More than 40 percent of those surveyed said they set business strategy using a time horizon of less than three years,...