Six of South Africa's largest state-owned enterprises are being held to a higher standard of accountability from an unusual source: an asset management firm led by a CFA charterholder.
CFA Institute / Let's Measure Up / Article 6 of 6
Andrew Canter, CFA, Measures Up — South Africa
Six of South Africa's largest state-owned enterprises are being held to a higher standard of accountability from an unusual source: an asset management firm led by a CFA charterholder.
In August 2016, Andrew Canter, CIO of Futuregrowth and CFA charterholder, made an unprecedented statement. On the brink of plans to lend more than 1.8 billion rand to three state-owned entities, Canter announced that his firm had ceased lending to state firms.
South Africa's political climate at the time was host to a conflict between different governing branches, a lack of clarity on the role of patronage networks, and a challenge to the National Treasury's independence. In order to protect its clients from growing uncertainty, it became unjustifiable for Canter's firm to continue lending to state-owned entities.
Futuregrowth was founded in 1995 with the belief that investors can make a positive difference in society while generating high investment performance for their pension fund clients.
To Canter, ethics is rooted in strong actions, not empty promises. Canter believes merely stating "do the right thing" isn't enough when teaching asset managers how to make ethical decisions. By teaching asset managers how to think broadly about their fiduciary duties not only to clients but to society as a whole, he believes that the finance industry has the power to transform more than just client portfolios.
"Responsible investors can choose to 'vote with their feet' or, preferably, actively engage with companies on matters of governance and sustainability."
Andrew Canter, CFA
As a responsible investor and fiduciary manager, Canter refuses to accept this lack of transparency, even if it comes with business, reputational, or even personal risk. Financial responsibility is reciprocal. Because Canter commits to providing transparency to his clients, the institutions and government bodies he invests in have a responsibility to provide it as well.
Futuregrowth's decision ended up being a declaration, a declaration that Canter hopes will be embraced by investment managers facing other ethical issues around the world.
"Investors are decision makers in the allocation of capital toward sustainable enterprises and should play a key role in holding companies to account for their practices."
Andrew Canter, CFA
By holding the institutions who serve the people of South Africa to a higher standard, CFA charterholder Andrew Canter measures up.