Mercer, Stikeman Elliott LLP and the Generation Foundation (the philanthropic arm of Generation Investment Management) will collaborate on a global research project to explore the impact of programs designed to reward corporate shareholders for holding on to their shares for a specific period of time.
The research will consider loyalty rewards such as dividends, warrants or additional voting rights, and their ability to address concerns that “short-termism” in economic and corporate decision-making may be damaging the way that companies are managed.
“With the launch of this project, we are looking to dig deeper into the various proposed solutions to short-termism and determine the possible role that loyalty and related instruments could play,” said Jane Ambachtsheer, Mercer’s global head of responsible investment. “There are some interesting precedents, and a range of opinions. Toward the end of this project, we will have a much better sense of whether and how incentives could be utilized by a broader range of issuers, and if not, why not.“
Mercer will lead the project with insight and support from Stikeman Elliott LLP. “We are excited to be part of this project,” said Stikeman Elliot partner Ed Waitzer. “The research should shed light on the efficacy of loyalty instruments, or variants thereof, and provide issuers with a more robust tool kit for building a loyal shareholder base.”
The research will include interviews and focus groups in order to investigate short-termism from various perspectives, discuss possible solutions, and determine feasibility and practicality of loyalty instruments.
Those interested in participating can visit mercer.com/loyaltyrewards.