Our RI strategy is based upon three strategic pillars of Quality, Stewardship and Engagement. This strategy is underpinned by a strong governance framework and is supported by our specialist RI team. Each year we publish a responsible investment and stewardship report which outlines our progress in these areas and profiles each of our investment team’s approaches to responsible investment.

ESG integration

Our commitment to RI and stewardship is a common thread which runs through all our 16 investment teams. However, each investment team are specialists in their respective fields, and set their own investment philosophies and processes. That includes their own approaches to incorporating ESG factors into their investment decisions. We think this diversity is a key strength of our collective business as it allows us to share ideas, develop our knowledge and learn from each other’s experience.

Listed Equities

Each active listed equity team has a process for identifying and assessing the relevance and materiality of ESG issues for their respective asset class. For each active equity team, engaging with investee companies is a key source of insights on such risks and opportunities. These insights, coupled with the best available third party ESG research, are assessed by the relevant company analyst and incorporated into stock notes or reviews, and influence company valuations.

Some teams assign specific ESG scores, while others incorporate the assessment into broader views of company management and business quality. All active equity teams hold regular team meetings to discuss company assessments, including ESG factors.

Fixed Income

Like our equity teams, our fixed income teams have developed their own approaches to ESG integration that complement their investment processes. All teams within our global fixed income business share significant elements of their investment processes, including analyst resources.

The teams believe that ESG issues have a direct impact upon an issuer's risk and therefore its probability of default. As risks turn into liabilities, they can impact cash flow and, therefore, on debt costs and credit ratings. ESG issues can also impact on a sovereign's ability to generate sustainable revenues or potentially increase its future costs, affecting its ability to repay bond holders.

Our fixed income teams have an assessment process for ESG issues which flows into their view of a particular security, whether through the six-factor model used by the Emerging Markets Debt team or the ESG score and internal credit rating used by the other Fixed Income and Credit teams.

Unlisted Infrastructure

For our Unlisted Infrastructure team, the ownership interest we currently hold in our portfolio companies ranges from circa 15% to 100%. Our investment professionals are therefore a key part of the corporate governance structure and often also sit on governance and management committees, such as Boards of Directors or Shareholder Representative Groups. Consequently a more bespoke approach to ESG integration is desirable and necessary. The team has developed separate and detailed RI policies and assessment frameworks, while still adhering to the organisation-wide approach.

The team like to take a lead role in any acquisition and lead the agenda in the consideration of all investment issues, including ESG. Furthermore, in instances where we do not acquire a controlling interest, we make sure we carefully select likeminded co-investors so that we have a similar approach to all investment issues, including ESG considerations, which extends to defining strategy and approving policies.

Once appointed, our directors oversee executive management, influence business strategy and embed operational and investment policies (specifically including consideration of ESG issues).

Company Engagement

Given the varying nature of the asset classes we manage, the geographies in which they operate and the size of our holdings, each of our investment teams’ engagement approaches are tailored to individual companies and the specific issues in question. In all cases there is a focus on material ESG issues that could impact on investment value over all periods, but particularly over the long term.


Engagement with company management is a fundamental part of our equity teams’ investment processes. Through company engagement, we seek to highlight areas for potential improvement and risk reduction, encourage improved disclosure on ESG issues, and commend companies that are making progress in these areas. We have guidelines and principles for corporate engagement, which are available on our website.

On occasions where our engagement activities are unsuccessful and we believe that this will remain so; we may escalate the issue - for example by writing to or meeting with the chairperson or lead independent director, vote against directors who we believe are not providing appropriate oversight, or collaborate on further engagement with other like-minded investors. In some instances we may make our views public. Ultimately, we may choose to sell down our holding where we lose confidence in management following unsuccessful attempts to engage.

Fixed Income

While different to the access and approach that is possible for listed equity teams, our fixed income teams engage with counterparties, corporates, governments and supranational issuers to raise ESG concerns. For counterparties, they conduct a formal ESG assessment, which is provided to the counterparties.

We also engage with credit rating agencies and collaborate with other fixed income investors to improve ESG integration practices across the industry. This is an area where we intend to focus more attention and resources.

Unlisted Infrastructure

For Unlisted Infrastructure, our seats on company boards allow greater direct oversight and influence.

Proxy voting

Proxy voting rights are an important asset for listed equity investors and exercising these rights is a core part of our stewardship responsibilities. We seek to vote on all possible resolutions at company meetings.

Prior to voting, the relevant investment manager and analyst carefully consider each resolution, with guidance provided by our guidelines and principles for corporate engagement on ESG issues. [Need a link to the guidelines and principles.] We also seek recommendations from a selection of independent corporate governance research providers.

Our investment teams retain full control over their proxy voting decisions, however, and do not necessarily follow the guidance provided by third party governance research providers. In the team profiles section of this report, we have disclosed statistics on the independence of our team’s voting and also provide a ‘live’ voting tool page which discloses all voting decisions post meeting.

All teams have an approval and escalation process for proxy votes and maintain records when they vote against management or against the recommendations of the proxy voting adviser. Investment teams are responsible for their own voting and, from time to time, different teams may vote in different ways on the same issue. To manage this, whilst maintaining team independence, we are developing forums where teams that are voting on the same company can discuss the key issues (while always complying with regulatory requirements related to collusion or takeover provisions).

We make our proxy voting record publicly available.

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