Fund managers want to be 'active not activist'

30 March 2004

Almost 40 per cent of fund managers just polled by Morningstar, the fund research group, do not believe they should take a more active role in companies in which they invest.

The poll, of 63 leading fund management groups - managing an average of € 54 billion in assets - showed that a substantial majority believe corporate governance issues became much more important, and 61 per cent said they would speak out more at company meetings.

But this did not mean they would become corporate governance crusaders. According to Niklaus Tell, who directed the survey, fund managers would become active, not activists.

In Europe, Britain, Sweden and Germany were the countries where fund management groups said they were most active in corporate governance, while Spain, Italy and Greece were where they said they have been inactive.

In the United States, Morningstar has been active in supporting Securities and Exchange Commission (SEC) proposals to increase the role of independent directors on fund boards, and to have an independent chairman.