The irresistible rise of ESG investing
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Back at the time of the 1984 miners’ strike, Arthur Scargill, the president of the National Union of Mineworkers (NUM), was involved in another, much less famous dispute. Scargill had put the Coal Board’s pension fund under pressure to avoid investing in oil and gas companies and divest from South African mining companies – partly because the NUM wished to avoid funding competitors of British coal mines and partly out of a genuine desire not to support the South African apartheid regime.
The case went to the High Court and Scargill lost. The judge ruled that the purpose of the Coal Board’s pension and the duty of trustees was to optimise the expected financial return. They were to put aside personal views and moral qualms. The trustees’ duty to their coal miner beneficiaries was to serve the best financial interests, rather than divest assets for social reasons. “Trustees may even have to act dishonourably (though not illegally) if the interests of their beneficiaries require it,”
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