Who should savers really trust? The answer could be simply: themselves and each other!
Ordinary savers should be aware they are part-owners of businesses and should care how businesses behave. However, with vested interests resistant to change, we need independent volunteers to help tackle the problems involved.
Understanding conflicts of interest
Lord Myners discusses1 the problems of the ‘ownerless corporation’; which is how he describes the consequences of the underlying owners of companies not being able to vote or attend meetings. Is it surprising, therefore, that executive pay causes scandals and accusations of short-termism?
However, the larger conflict that has to be faced initially, lies between the financial sector and the ordinary saver. Helping savers ‘take control’ of their own finances is the primary objective of the Savers Take Control (STC) initiative – a huge but worthwhile challenge.
Helping and learning from each other
The UK Shareholders’ Association (UKSA) was founded in 1992 by a group of volunteers and aims to assist money management across the UK. We are at an early stage in developing our education programmes and our ‘Honest money now’ education site2 is freely available to anyone.
Our aim is to help people who are equipped to learn for themselves; as well as addressing the challenges facing those who cannot access financial advisors.
The secret weapon: knowledgeable volunteers
But ‘knowledgeable’ is not enough – the STC activities require that volunteers are strictly independent of the financial sector (although people who have worked in finance, but are no longer conflicted, are among our volunteers). Most of our active volunteers are retired; this is one of many examples of the older generation contributing to society.
Read more in the separate article “Responsible investing – what does it mean in 2020?“.
1In this lecture Lord Myners explains how, when leading a successful fund manager, he came to understand the problem of the ownerless corporation. | 2honestmoneynow.co.ukis a basic financial education site developed by members of UKSA. It is aimed at all those who should be investors but believe it is “too difficult”.