THE Co-operative Insurance Society has joined an elite group of institutional investors, worth over £ 1.75 trillion, who are making a stand for corporate transparency.
The group's target is to boost transparency standards in the oil and mining sectors of developing countries. Known as the Investors' Statement on Transparency the initiative gathers fund managers and pension funds from Europe, USA, Canada and South Africa, and signals the growing interest taken by the institutional investment community in matters related to governance and corruption.
Howard Carter, Chief Executive of ISIS Asset Management, which has co-ordinated the investors' statement, commented: "As extractive companies become increasingly dependent on securing contracts in developing countries, they, and we as their shareowners, want to reduce the business risks and costs that are synonymous with poor governance and corruption.
"In summary, this initiative is good for business, and it is good for shareholders."
The statement calls on global extractive companies to play an active role in the UK Government's Extractive Industries Transparency Initiative (EITI), which seeks to bring companies and governments together to make such payments public knowledge.
At a recent meeting hosted by Tony Blair companies and governments were invited to sign up to a Statement of Principles. The Prime Minister said: "This unprecedented support from the investment community demonstrates that good governance and transparency serve the interests of the business community wherever it operates.
"It is thanks to the active involvement of all parties, including both the businesses operating on the ground and the capital markets that fund them, that we will succeed in making the EITI achieve its goals. Better openness and accountability are essential to securing the stability and prosperity that the developing world needs, and on which our mutual business success depends."
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