Sir Paul Marshall hits out at 'woke capitalism' as he warns of 'the end of the free market'

He hit out against "financial cronyism", warning that it would cause free market capitalism to "end in a form of corporatism similar to socialism".

Addressing what he sees to be hindrances to its functioning, Marshall told delegates: "The third mutant sibling is woke capitalism.

"Woke capitalism is the imposition of a top-down ideology onto the free market system by politically motivated bureaucrats either from the public or the private sector.

"Their ideology is framed through ESG. In some cases, there is also a garnish of diversity, equity and inclusion.

"To be fair, corporate governance in public equity markets has not worked well for a long time.

"This is because of a genuine market failure known as the agency problem. Fund managers, acting as agents, have mostly failed to ensure proper governance on behalf of the beneficial owners of the shares, mainly because it was too burdensome or too expensive."

He added: "The intent behind all three elements of ESG - environment, social, and governance - may actually be a good one. But the effect has been to create a set of standardised ideologically-based taxonomies which have very little to do with good governance."

Marshall said the "correct response" to "woke capitalism" should not be to "return to the status quo".

Instead, he said, "we should all install the kind of governance that Adam Smith would have been proud of."

He explained: "That means every fund manager and beneficial owner, taking it seriously and using technology to vote their shares in their unique case-specific way and engaging correctly with investee companies to drive sound governance.

"By this invisible hand, we would end up with responsible, sensible outcomes."

Arc was established as "an international community with a vision for a better world".

Its mission is to generate a new approach to society, which would allow everyone to "prosper, contribute and flourish".

Addressing the conference earlier today, Tory MP Miriam Cates issued a stark warning over "economic stagnation" and "destabilizing mass immigration", both of which she said could result from the fertility decline seen by the West.

Speaking at the Alliance for Responsible Citizenship (Arc) Conference in London, the Conservative MP warned that the "social fabric" is "fraying around us", calling for a reversal of the fertility decline.

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Meanwhile, Canadian psychologist Jordan Peterson hit out at identity politics, claiming it is "tearing us apart".

Peterson said that "concerns about identity" will lead to a "pathway that's marked out by nothing but...self-serving hedonism".

He also used his speech to ask delegates: "How do we tilt the world uphill rather than downhill?", rejecting a declinist vision of the world.