The FCLT-Global Organization Needs A Guiding Beacon: How The Pragmatic Theory Of The Firm Could Fill The Bill

“Until large asset owners radically change their approach, other key players (such as asset managers, corporate boards, and company executives) will probably remain trapped in value-destroying               short-termism. But by accepting the opportunity and responsibility to be leaders who act in the best interests of individual savers, large asset owners can be a powerful force for instituting the kind of balanced, long-term capitalism that benefits everyone.”

Dominic Barton, former Global Managing Director, McKinsey&CoMark Wiseman, former CEO, CPP Investments

Our January Letter 

Careful Letter readers will recognize the quote above. It also opened the January 2026 Letter which was titled “Focusing Capital on the Long-term: Are We There Yet?”. The context for that question was the  widely-read 2014 Harvard Business Review article by Barton and Wiseman titled “Focusing Capital on the Long Term”. To that end, they recommended that asset owners take four “proven, practical steps”:

1. Clearly define the organization’s long term investment objectives and risk appetite.
2. Unlock value through engagement and active ownership.
3. Demand long-term metrics to inform decisions.
4. Structure institutional governance to support a long-term approach.

Next, the January Letter asked what has actually happened post-2014. Did the HBR article have any positive impact? Yes it did. The most visible example was the formation of the Focusing Capital on the  Long-Term - Global organization in 2016. Its stated mission is to “mobilize companies and investors to focus capital on the long term to create lasting value”. This is to happen “by developing research-backed strategies that enhance value-creation for savers and communities”. Out of these aspirations has come a FCLT-Global behavioral “Gold Standard” covering governance, incentives, engagement/dialogue, and measurement/metrics. These factors line up nicely with the four ‘proven, practical steps’ set out by Barton and Wiseman in their 2014 HBR article.

However, the January Letter also observed that to date, the FCLT-Global “Gold Standard” has remained largely aspirational, with one exception. Under the leadership of CEO Mark Wiseman, CPP Investments had already launched its Portfolio Value Creation (PVC) Group prior to the publication of the 2014 HBR article. Its mandate looks very much like the FCLT-Global’s “Gold Standard” However, to our knowledge, the PVC Group with its 40 professionals spread across six strategic locations around the world continues to be the only dedicated implementor of the FCLT-Global’s four-step “Gold Standard” to this day.