[Interview] Uniting shareholders to make companies listen

In the United Kingdom, a small organization with just nine staff members wields considerable influence over corporate boardrooms by uniting institutional investors. The Investor Forum, a nonprofit established in 2014, represents a collective of pension funds, insurers, and asset managers. Together, its members command approximately 25% of the FTSE's market capitalization, a significant portion that companies cannot easily ignore.

Victoria Sant, the managing director of the Investor Forum, explained in an interview with The Hankyoreh that the organization acts as a crucial intermediary. While member firms typically engage with companies individually, the forum steps in when a company dismisses a shareholder's concerns, often by claiming they are the only one complaining. The forum then verifies if other shareholders share the same issues and assesses the potential for a critical mass of ownership to be assembled.

Sant described the forum as "a kind of insurance policy" that members hope not to utilize. Collective engagement is viewed as a last resort, employed only after direct, one-on-one discussions between investors and companies have failed to yield results. This approach ensures that individual engagement is prioritized, with the forum serving as an escalation route when necessary.

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You’re the only one complaining. Every other shareholder is happy.

Over its 12 years of operation, the Investor Forum has focused on building "safeguards" for shareholder engagement rather than solely accumulating influence. This strategy involves establishing clear processes and a credible threat of collective action, which strengthens the effectiveness of initial one-on-one conversations. The UK Stewardship Code itself supports this principle by outlining a pathway for escalating concerns when direct engagement proves insufficient.

This model offers valuable lessons as South Korea revises its Stewardship Code, introducing a new provision for "collaborative engagement" among institutional investors. The UK's experience demonstrates how such a system can be practically implemented to ensure that shareholder voices are heard and addressed by corporate leadership.

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a kind of insurance policy