Recently, Australia's parliament passed legal amendments to reform financial services in the country. Among the amendments was a rule requiring institutions managing retirement trust funds to tell investors to what extent they take social responsibility into account when they make investments.
"Social responsibility" here means the extent to which they consider labor, environmental, social and ethical standards when investing trust funds in a certain company. In addition, when these trust funds say their investments are socially responsible, they must also present a set of guidelines and tell the investors how they are undertaking those socially responsible investments.
In fact, Australia is not the first country to enact such legislation. The UK passed a similar law in 1999. Since that law came into effect in July 2000, about 60 percent of the UK's retirement trust funds have made social responsibility an important element of their investment policies. To quantify the figures, more than US$500 billion in retirement funds is now being invested in socially responsible companies.
We all know that pension funds are an important force in long-term stock market investment. When their investment criteria are no longer limited to business profits, know-how and market potential -- when non-market "moral factors" also become important -- share prices can then reflect whether a company is being social responsible. The emergence of such legislation in the UK and Australia reflects a new form of social activism taking shape in the Western world. These new social movements include the environmental, Aboriginal, homosexual and labor rights movements.
To lower labor and environmental costs, major companies in the West outsource manufacturing work to developing countries. To attract foreign investment, developing countries do their best to lower wages and environmental standards so that they can meet the demands of the multinationals. This has resulted in violations of labor rights, such as the use of child labor, forced labor and corporal punishment.
To stop this development, many "anti-sweat" movements have emerged in Europe and in the US. They urge people not to buy clothes, shoes, cosmetics, toys and other products made by exploited "sweatshop" workers. Because of these movements, major brand names in the West are beginning to set up "codes of labor" and require their manufacturers to abide by them.
This trend breaks the pattern of thinking that we are used to: the idea that increased labor welfare will invariably lower competitiveness. According to the investment models of the British and Australian retirement funds, only when a company improves labor welfare can it realize its true value because only then are the retirement funds willing to invest.
By contrast, socially irresponsible companies will gradually be abandoned and lose orders as well. During her visit to Taiwan last year, futurist scholar Hazel Henderson, told me that a Swiss investment company under her direction had established a set of investment principles in 1973, whereby they avoided investing in any company with a history of violating environmental regulations.
Henderson said that people at the time thought they were crazy, but after 30 years, they are one of the very few high-return investment companies in Europe.
Can our businesses and states still say, "Welfare will undercut competitiveness" when social responsibility is becoming an increasingly important standard for investment?
Wang Hong-zen is an assistant professor of future studies at Tamkang University.
Translated by Francis Huang
Recently, China launched another diplomatic offensive against Taiwan, improperly linking its “one China principle” with UN General Assembly Resolution 2758 to constrain Taiwan’s diplomatic space. After Taiwan’s presidential election on Jan. 13, China persuaded Nauru to sever diplomatic ties with Taiwan. Nauru cited Resolution 2758 in its declaration of the diplomatic break. Subsequently, during the WHO Executive Board meeting that month, Beijing rallied countries including Venezuela, Zimbabwe, Belarus, Egypt, Nicaragua, Sri Lanka, Laos, Russia, Syria and Pakistan to reiterate the “one China principle” in their statements, and assert that “Resolution 2758 has settled the status of Taiwan” to hinder Taiwan’s
Can US dialogue and cooperation with the communist dictatorship in Beijing help avert a Taiwan Strait crisis? Or is US President Joe Biden playing into Chinese President Xi Jinping’s (習近平) hands? With America preoccupied with the wars in Europe and the Middle East, Biden is seeking better relations with Xi’s regime. The goal is to responsibly manage US-China competition and prevent unintended conflict, thereby hoping to create greater space for the two countries to work together in areas where their interests align. The existing wars have already stretched US military resources thin, and the last thing Biden wants is yet another war.
As Maldivian President Mohamed Muizzu’s party won by a landslide in Sunday’s parliamentary election, it is a good time to take another look at recent developments in the Maldivian foreign policy. While Muizzu has been promoting his “Maldives First” policy, the agenda seems to have lost sight of a number of factors. Contemporary Maldivian policy serves as a stark illustration of how a blend of missteps in public posturing, populist agendas and inattentive leadership can lead to diplomatic setbacks and damage a country’s long-term foreign policy priorities. Over the past few months, Maldivian foreign policy has entangled itself in playing
A group of Chinese Nationalist Party (KMT) lawmakers led by the party’s legislative caucus whip Fu Kun-chi (?) are to visit Beijing for four days this week, but some have questioned the timing and purpose of the visit, which demonstrates the KMT caucus’ increasing arrogance. Fu on Wednesday last week confirmed that following an invitation by Beijing, he would lead a group of lawmakers to China from Thursday to Sunday to discuss tourism and agricultural exports, but he refused to say whether they would meet with Chinese officials. That the visit is taking place during the legislative session and in the aftermath