All companies rely on individual members of staff to make decisions. By establishing a strong, ethical culture which focuses staff on a purpose and set of corporate values, this culture will encourage employees to act cohesively for the long-term success of the company.
How does VicSuper advocate for improved governance and culture when we invest?
As a responsible investor, we believe that governance (including culture and remuneration), as well as social and environmental factors, can have a significant impact on investment risk and return. In fact, history has shown that corporate misconduct can have serious consequences for company value through damage to stakeholder relationships and brand reputation, as well as legal liabilities and financial costs. Engagement by institutional investors focused on long-term returns can help to strengthen governance and culture.
In relation to governance and culture and the companies in which we invest, we seek companies that:
- Put their customers first
- Treat their key stakeholders fairly
- Implement best practice codes of conduct and whistleblowing systems that prevent bribery and corruption
- Demonstrate an ethical culture with clear values and a supporting ‘tone from the top
VicSuper is a member of the Australian Council of Superannuation Investors (ACSI) and we have appointed ACSI to undertake engagement across our Australian investments. In 2018, ACSI released a report comparing company codes of conduct and whistleblowing systems among ASX 200 companies. As a result of that research, corporate culture has been a particular recent focus of ACSI’s company engagement, targeting companies with identified gaps in their practices and setting clear expectations of companies.
We will continue to hold to account all companies in which we invest for their governance, culture and remuneration, for the benefit of our members and the wider community.