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Article

18 May 2012

Author:
Bonita Meyersfeld, Director of Centre for Applied Legal Studies and associate professor at Wits School of Law, in BusinessDay [So. Africa]

Bonita Meyersfeld: New pension fund rules deserve to be applauded [South Africa]

Do institutional investors have a legal obligation to take steps to help prevent the violation of human rights by the companies in which they invest? Is it lawful for institutional investors to make a profit from the operations of multinational corporations that are complicit in, or commit, human rights violations? The South African government unequivocally said pension fund investment is no longer business as usual. This is in line with the United Nations Principles on Responsible Investment and SA’s Code for Responsible Investing...But what does this mean in practice?...[E]nsure that...money is not invested in companies that are complicit in crimes against humanity, environmental fallout, or lax governance...[W]ill this really affect the bottom line or will regulation 28 simply make life a little more difficult for pension fund trustees?...Some argue responsible investment is not only consistent with, but is actually a precursor to, a long-term, stable and valuable fund. [refers to Ford]