January 1, 2017

Our Journey Towards 'Long-Termism': Getting To A 'Tipping Point'

“In the end, ‘Tipping Points’ are a reaffirmation of the potential for change and the power of intelligent action.”


 “Under what circumstances is collective action among asset owners and managers realistic and potentially effective?”


Tipping Points

A review said Gladwell’s now 16 year-old book was “an elegant exploration of how social epidemics work……it reaffirms that human beings are profoundly social, influenced by, and influencing other human beings, no matter how much technology we introduce into our lives.” SCIENCE Magazine article “Social Norms as Solutions” examines the Tipping Point idea from a different perspective.i It asserts: “Many global challenges pose major collective action problems. A group benefits from a certain action, but no individual [or organization] has sufficient incentive to act alone.” Defining a social norm as “predominant behavior within a group”, the article suggests collective action in the form of legislation and regulation may be needed to create Tipping Points for beneficial changes in collective behavior. The cited “Tipping Point 2016” article makes the same point from systems thinking perspective.ii

This Letter examines the global challenge of shifting the investment of retirement savings from processes driven by short-term thinking to processes driven by long-term thinking. In short, how can we create virtuous dynamics that would accelerate such shifts? Is it more assertive voluntary forms of individual and collective action? More muscular forms of legislation and regulation? A more activist approach to using the courts? Or some combination of all three approaches? 

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