Pomerantz Holds London Corporate Governance Roundtable With Sir Tony Blair
by the Editors
Ten years ago, Pomerantz decided to gather a small group of institutional investors to share ideas and concerns regarding the funds these investors represent. Over the past decade, the original gathering of 5-6 institutional investors gradually grew to over 75 participants, becoming the Firm’s marquee event for investors: Pomerantz’s Corporate Governance Roundtable. On June 18th, 2024, for the first time, the Roundtable was held outside the United States, with over 100 institutional investors, corporate governance professionals, and investment experts from all over the world attending a full-day conference in London, the UK. The program featured topics ranging from AI to greenwashing to securities litigation. The day’s highlight was a keynote interview by Pomerantz Managing Partner, Jeremy A. Lieberman, with former British Prime Minister, Sir Tony Blair, who provided an insightful assessment of the current state of global affairs.
“The response was phenomenal,” says Pomerantz Partner and Head of Client Services, Jennifer Pafiti, who played a leading role in organizing the Roundtable. “The feedback we have received over the years is that institutional investors consider these events crucial for keeping pension professionals connected and educated on real-time matters that affect the value of the funds they represent.” Held at Landing 42, the UK’s highest event space in the heart of the London’s financial hub, the theme of this year’s conference was “Lessons Learned from Corporate Governance Failures.” “Hearing insight and discussion from the most expert governance professionals in the world was fascinating,” adds Pafiti, “both in terms of their presentations and the dialog with the audience.”
One of the issues discussed was the challenges that pension fund investors face from so-called “greenwashing,” which refers to the practice by companies or fund managers of making unfounded claims about their organizations’ environmental responsibility initiatives. A panel dedicated to the subject at the Roundtable suggested that although regulation can provide important guardrails for issuers, there is no substitute for effective due diligence and scrutiny by pension funds of the information that is provided. The challenge will be to find the right balance between encouraging disclosure of ESG related matters and ensuring that the information is evidence-based and reliable. “It would be in no one’s interests if the result of exposing greenwashing activity that has taken place would be a reluctance by issuers, in particular, to disclose any information other than that which is mandatory,” says Dr. Daniel Summerfield, Pomerantz’s Director of ESG and UK Client Services, who helped organize the conference with Pafiti. “Disclosure of ESG needs to become an authentic endeavor by all parties.”
A recurring theme in discussions at the conference was that, with the benefit of hindsight, many of the causes of previous instances of corporate malfeasance were hiding in plain sight but were ignored or excused as an inconvenient truth. While securities litigation can act as an important backstop and deterrent as well as as a way to secure compensation for investors and put in place corporate governance reforms, it should not be seen as a panacea. Conference attendees agreed that there is no substitute for investor scrutiny of corporate governance and effective engagement and stewardship. An important consideration was paraphrased by one panelist as the need to ensure that we can turn hindsight into foresight to provide more insight.
“Having been involved in several Pomerantz roundtables over the years, I believe that this was the most successful one to date owing to the caliber of speakers, diversity of delegates and the rich and relevant content, as well as the keynote address by Sir Tony Blair,” offers Summerfield. “Holding the event overseas for the first time was a strategic decision reflecting the internationalization of our client base as a result an increased interest in securities litigation among global investors. The choice of sessions at the Roundtable was responsive to the key issues which are of concern to our U.S. and international clients. Our Roundtables are part of our series of global educational and networking events – albeit at a larger scale – that we regularly host in different countries to cater to the increase in demand and interest in the services we provide.”
Adrian Wilkes, Deputy Head of Investments Legal and Tanya Bagley, Head of Investments and Markets Legal, both of Brightwell Pensions (formerly known as BT Pension Management), UK, participated in the London Roundtable. Reflecting on it afterwards, they jointly expressed:
“We always find Pomerantz events to be highly informative and enjoyable, and the 2024 Corporate Governance Roundtable was no exception. The quality and range of the speakers and sessions was impressive, and we really value the insights afforded by hearing the experience and thoughts of both UK and international peers on highly relevant topics – as well as the opportunity to catch up with familiar faces and meet new ones. An excellent event altogether – many thanks!”
As far back as 2007, the TIAA-CREF Institute asserted that the primary actors promoting changes in corporate governance systems are often foreign. “What has become increasingly apparent and was noted at the Roundtable,” explains Summerfield, “is that with the globalization of investors’ portfolios, we need to learn from the experiences of domestic investors based in the markets in which we now invest. The utilization of alternative engagement tools may also be required as investors diversify their risks and increase their exposure to different markets which may not have the same level of corporate governance standards.”
With a potential regulatory race to the bottom as stock exchanges compete for IPOs – a topic which was also discussed at the roundtable – business as usual may no longer be appropriate in holding investee companies to account. Pomerantz stands ready to support our clients as they manage these additional risks in an increasingly volatile and uncertain world.