Colin Melvin is the former Standard Lifer now charged by 33 pension funds managing $165 billion (£106bn) worldwide with monitoring how firms behave, from executive pay to social and environmental responsibility.

He is successor at Hermes, the BT pension fund manager, to Alastair Ross-Goobey, who put corporate responsibility on to UK investors' agenda 25 years ago.

Eight years ago, after two years as head of corporate governance at Hermes, Mr Melvin widened his influence by creating Hermes Equity Ownership Services, to represent other like-minded pension funds that are the most significant real owners of companies.

Mr Melvin's team has grown from five to 26, made up of 13 nationalities speaking 17 languages. It offers real fire power to funds that include four Danish, five Dutch, two Canadian and two Australian, alongside the likes of Shell, BBC, BAE Systems, RBS and Lothian pension funds.

On the flurry of shareholder activism a year ago in the UK, Mr Melvin says: "Much was made of the so-called shareholder spring, which was a rather ridiculous phrase, but there wasn't any increase in voting (at AGMs), there was a concentration of interest in certain situations, which tended to be linked to underperforming chief executives."

That had, however, led to increased sensitivity in companies to designing more shareholder-friendly bonus and incentive schemes.

One of Mr Melvin's big achievements was to convene 44 chairmen of big company remuneration committees in a private forum, and agree "four principles" that ought to underpin future schemes. "The position of interested owner is very different from the position of trader of the shares, whose primary aim in talking to executives is to make a better trading decision."

He says that is why the recent report by Professor John Kay on encouraging long-term investment in the UK, like the stewardship code before it, "missed an opportunity and missed the point", despite brilliant analysis.

"The mistake was to view fund managers as the owners of companies – it is understandable, as the fund managers are taking the decisions, but who are the real owners? If you really want to change the industry, to get better alignment of interests and drive down the costs of fund management, what you need to do is make it a duty of pension funds, and empower them to do this work."

The Hermes team holds about 450 "engagements" a year with firms at senior level. Mr Melvin says: "Our largest companies here and globally are effectively ownerless, because the interests of the real underlying owners are not being properly represented to the boards of those companies."

Edinburgh born and educated, Mr Melvin has history degrees from Aberdeen and Cambridge. He qualified as an investment analyst and trained as a fund manager, and has two qualifications in company directorship.

He worked at Standard Life for corporate governance head Guy Jubb, then moved to Baillie Gifford to set up responsible investment governance structures.

But what do pension fund savers think, and is there any value to surveys that show people "would like their money to be invested ethically" but do nothing about it?

Mr Melvin says what is needed is specific questions about "bribery and corruption, armaments, mining companies, risk management in extractive industries, executive remuneration".

He adds: "Companies that improve their governance become more transparent, more accountable, more open and better run, will tend to provide better returns."

A forthcoming study by St Andrews University using Hermes data is likely to show that environmental social and governance (ESG) interventions on behalf of long-term owners improve company performance.

More than 1000 of the world's top firms and fund managers are signed up to the UN Principles of Responsible Investment, but Mr Melvin says they are "at different stages", with the integration of ESG principles into decision-making still the holy grail.

He says consumer product giant Unilever is a sign of the times. "They are a company that sees sustainability as part of the way they make money in the longer run, and they are starting to take what they do on the corporate side and think about their pension funds. Companies that have brought in good sustainability policies or are facing sustainability challenges are considering their pension fund investment in the context of those challenges, and starting to act as good corporate owners."

While fund managers using ESG strategies are looking at individual companies, pension fund trustees are choosing managers, Mr Melvin says. "They decide which managers to go with and where to put the assets.

"There are longer-term themes which are highly relevant to pension investment and not normally incorporated by fund managers. The industry is interested in short-term transactions and benefiting from them, it has a lot of information to support that behaviour, and the suspicion is that pension funds themselves often don't benefit from that transactional behaviour."

However, defined-benefit pension fund trustees are better resourced than the stewards of defined contribution schemes, so the continuing and unstoppable move from DB to DC in the market is hardly helpful to the ESG agenda. "It is more problematic," Mr Melvin admits, pointing to Australia and the Netherlands, where trustees operate in groups that have more clout. "In the UK, the DC model pushes all the risk and responsibility onto the saver, and the trustee is somewhat less involved in looking after their interests."

He looks back to BP in 2010. "If you were a big holder of BP shares you'd have lost a lot of money, but should you have been doing something about that in terms of risk management? For a single trustee or pension fund that is pretty difficult, but by pooling resources and working together they can achieve more than individually. It is a huge opportunity."