The theory of engagement - that shareholders can influence corporate
policy for the better - is an attractive one, but often the actions of one or two SRI-conscious investors can do little to change things. That is why working together can be an effective policy.
Last month a group of eight financial institutions, including Friends, Ivory & Sime, Henderson Global Investors and Morley Fund Management, joined forces to launch Business Involvement in Myanmar (formerly Burma).
In the case of Burma, there is the possibility of a democratically elected government returning to power and penalising companies supportive of the military regime. So the group wants make sure companies are aware of the risks and establish effective policies and procedures for managing them.
Among other things, the group is calling on companies to carry out and publish independently verified social impact assessments to ensure accurate understanding of the risks they face - including those relating to human rights abuses and corruption - and provide detailed and independently verified reports on their performance against these policies.
Given the funds held by Business Involvement in Myanmar amount to more than£400bn, such collective action has a good chance of having some impact on corporate thinking.
There are some people who hold the view that investing in companies with operations in Myanmar is not compatible with SRI.
But for those who think they can achieve more by interacting with firms, this sort of move seems to be a pragmatic way of trying to ensure those firms which continue to operate there do not contribute to human rights abuses.
It should hopefully help ensure neither the people of Myanmar nor the performance of UK pension funds have to suffer either.