In 2015, fifteen Dutch CIOs of asset owners and asset managers wrote an article with the title: ‘Short-term profit or long-term value creation?’ A growing group of pension funds, asset managers, consultants and companies worldwide try to answer this question.

Whilst supranational institutions and NGOs have for too long been alone on the front lines of the battle against poverty, corruption, and resource depletion, both companies and the finance sector are now fully aware of the role they have to play in the transition to a more sustainable economy. So-called “megatrends” – demographics, globalisation, the environment, societal evolution – act as disruptive forces and offer growth potential for investors. The motivations of asset owners have evolved; they have become more elaborate, more complex and more meaningful, and now include topics that go beyond the unique consideration of achieving financial performance. Even if performance remains the primary objective, investors now want their portfolios to have an impact on both the environment and society, and want to measure the efficiency of this choice.

Economics has developed as a science, conveniently forgetting its roots in political philosophy. Unfortunately that ‘science’ is severely dated, and the functioning of the global capital markets has become separated from the real world. A simple thought experiment throws light on the theoretically correct strategies for a rational saver, but leaves us with unsatisfactory answers. Neglecting the societal context of our saving activity only serves to further isolate the capital markets. Instead, a self-perpetuating system requires investors to evolve from simple allocators of capital to its steward, with far broader responsibilities. Maximising holistic returns represents practical action of the responsibility by investors, and stretches far beyond creating wealth simply for its own sake.