Making responsible corporate citizens is no easy task
The nagging controversy surrounding Link Reit’s business tactics that flared up again in the latest exchange of barbs with a seasoned politician has brought to the forefront the issue of corporate citizenship.
Normally, corporate citizenship is nothing more than a pet subject dear only to a few social activists. Tuned to the capitalistic notion that companies are there to make money and nothing else, the public admiration was largely focused on the most profitable few.
But, this is changing. Property barons who were once lionized like entertainment celebrities and sport stars have all been demonized for ruining the dream of many Hong Kong families who can no longer hope to buy a home. Property owners, like Link Reit, have fared even worse.
In this recriminating atmosphere, do those investors with the intention to do good have a choice other than to follow the profit driven market herd?
In some other markets, like the United States, fund managers have engineered investment trusts that appeal, at least partly, to conscience. They are called impact investments, and it has become a $250-billion market that is growing fast, according to a CNN report.
These investments are tailored made by some investment banks to meet the demands of a growing number of investors who desire measurable social or environment returns on their investments, plus, of course, capital gains. The market for impact investments is big because the majority of young investors are considering investment decisions “as a way to express their social, political and environmental values”, Jackie VanderBrug at Bank of America told CNN.
It’s not clear how much appeal such investments have to Hong Kong’s social and environmental concerned, young investors. But, there’s no shortage of listed companies, especially those in the utility sector, that have gone out of their way to showcase their achievements as responsible corporate citizens.
Though vilified by grassroots activists, Link Reit has made the point that its strategy of renovating the shopping malls it owns has helped enrich the lifestyles of many families living in the neighborhood.
Anchoring investment decisions on the good of society should be encouraged. But, it’s not as straight forward and simple a decision as it may seem.