The Anatomy of Investor Stewardship

This CLP lecture was delivered by Associate Professor Dionysia Katelouzou, on Thursday 7 March, as part of the Current Legal Problems Lecture Series 2023-24.
Speaker: Associate Professor Dionysia Katelouzou (King's College London)
Chair: Professor Paul L Davies KC (hon) (University of Oxford)
About the lecture
Institutional investors, functioning as stewards, exercise power and influence on behalf of their clients and/or beneficiaries. Yet, an often overlooked but fundamental distinction exists: the ‘others’ on whose behalf investor stewards act are not necessarily the same as the others for whom they are expected to act. By employing a heuristic encompassing multiple stewardship relationships within the investment chain, we can delve deeper into the ‘others’ at play. Distinguishing between client stewardship, end-investor stewardship, asset stewardship, and enlightened stewardship provides a comprehensive view of how investor stewards navigate their responsibilities: investor stewards act on behalf of their clients and/or beneficiaries while serving a broader spectrum of stakeholders, including the end investors, the investable assets, and the broader economy, environment, and society. However, a notable challenge emerges as stewardship relationships beyond client stewardship operate outside the domain of hard law. Here, stewardship codes can bridge this regulatory gap, working alongside numerous national and international instruments that impact investor behaviour. To elucidate the intricacies of such a gap-filling role, a typology of investor stewardship is presented, considering the complex levels, actors, assets, means and themes of investor stewardship. The anatomy of investor stewardship underscores the imperative to broaden considerations beyond immediate clients and/or beneficiaries, ultimately advancing the scholarly debate and informing policymaking.
About the speaker
Dionysia Katelouzou (PhD) is a Reader (Associate Professor) of Corporate Law at The Dickson Poon School of Law, King’s College London. She has a substantial publication record in peer-reviewed journals and edited books and presented her work internationally to diverse audiences. Her current research focuses on how institutional investors express and practice stewardship at domestic, regional, international, and transnational levels, combining socio-legal analysis with empirical methods. One of her notable contributions is the co-editing of the Cambridge University Press Handbook (CUP) Global Shareholder Stewardship: Complexities, Challenges & Possibilities, with Prof Dan Puchniak, which is widely considered the most authoritative work in shareholder stewardship. Dr Katelouzou’s forthcoming sole-authored monograph, Institutional Shareholders and Corporate Governance: The Path to Enlightened Stewardship (CUP 2024) offers a theory of investor stewardship and a comprehensive analysis of stewardship statements, questioning whether institutional shareholders are adequately equipped and structured to serve wider public interests. Dr Katelouzou leads the ECGI-supported Global Investor Stewardship project (see here), consisting of more than 140 academic and non-academic members across 27 jurisdictions around the world. She has received the British Academy Mid-Career Fellowship Award 2022, along with numerous smaller grants and conducted commissioned research for the Financial Reporting Council. In 2020, she was awarded the Cleary Gottlieb Steen & Hamilton LLP prize for the best ECGI Law Working Paper for her co-authored paper, “The Global Diffusion of Stewardship Codes”.