Our RI Strategy

For five years our strategic approach to responsible investment (RI) has focused on enhancing the quality and relevance of our investment capabilities, embedding a culture of stewardship across the organisation and engaging all our employees in our RI work.  Our Annual RI and Stewardship Report page details how we are progressing against these strategic pillars. 

Governance of RI and Stewardship

In a diverse global organisation good governance is extremely important. Governance of responsible investment and stewardship engages over 50 people across our global organisation, formal governance bodies are supplemented by less formal working groups which ensures people from across the entire organisation can participate in and be kept up to date on our responsible investment work. 

The key features of our governance framework includes:

Responsible Investment Steering Group – Chaired by the CEO and including our Chief Investment Officers, the steering group is responsible for setting the direction and strategy for RI and approval of the policy framework.

Specialist RI Team - The RI team engages with and coordinates the entire business to deliver the strategy which is overseen by the Responsible Investment Steering Group.

Global Investment Committee – Chaired by the CEO and including our Chief Investment Officers, the committee is responsible for monitoring investment risks and receives reporting on ESG risks and issues for investment teams and portfolios.

Policy Framework – The policy framework includes our global stewardship principles, guidelines for engagement and proxy voting, cluster munitions policy, guidelines on human rights and stranded asset risk.

ESG Committee – Comprising representatives from each investment team, the ESG committee is a practitioners group that collaborates on ESG issues and are the conduit between the steering group, RI team and investment teams.

HR Working Group – Chaired by human resources, the group is focused on the employee engagement strategic pillar of our RI strategy including diversity and training.

Marketing and Communications Working Group – Chaired by the Global Head of Responsible Investment the working group is concerned with how we communicate our responsible investment work both inside and outside the organisation. 

Distribution and Sales Group - The group shares the latest market and industry developments related to responsible investment and stewardship. The purpose of the group is to ensure our client facing people are well informed on the ways in which we can help our clients in with their responsible investment and stewardship needs. 

Benchmarking our Progress

Third party ratings and recognition

Our approach to RI and stewardship has always been client-focused. We benchmark our approach against various global standards and look to those standards to identify areas where we can improve our practices. These standards also provide a basis for developing our disclosures and therefore allow us to be more transparent about our progress.

While we are very pleased to have improved in our PRI Assessment results in 2018 (see table below), and to have continued our record of steady improvement since 2014, we recognise that this comes against a backdrop of broad industry improvement.

Other sources also demonstrate this improvement with the number of managers who achieved above 80% in the Responsible Investment Association of Australasia’s benchmarking report go to 24 from 17 last year. 

As long time advocates for responsible investment we are encouraged by the general industry progress.  

"We benchmark our approach against various global standards and look to those standards to identify areas where we can improve our practices. These standards also provide a basis for developing our disclosures and therefore allow us to be more transparent about our progress"

"In the 2018 PRI annual assessment results we achieved an A+ rating in seven of eight areas, an improvement in three"

Principle for Responsible Investment - assessment ratings

Each year every PRI signatory reports to the PRI on their responsible investment practices and how they apply the Principles. Our results since 2014 are below and our full Transparency Report and full assessment report can be downloaded from our website.

Because we have changed the reporting period we are reporting both our 2017 and 2018 results this year. In 2018 we achieved an A+ rating in seven of eight areas, an improvement in three.

Download our full assessment report here or view our transparency report on the PRI's website.

RIAA Benchmark Report Assessment

Each year the Responsible Investment Association of Australasia assesses the RI practises of asset managers in its annual benchmark report. The assessment includes the quality of a manager’s approach to responsible investment policy, ESG integration, active ownership, transparency and industry involvement.

In 2018 we were pleased to remain one of only 24 managers (from 112 assessed) who scored above 80% in the RIAA assessment. Most of those assessed are PRI signatories and so we find the RIAA results an important differentiator given most managers do not disclose their PRI assessment results.  

UK Stewardship Code - FRC Tiering

In 2016, the UK regulator the Financial Reporting Council (FRC), which has responsibility for the UK’s Stewardship Code, announced that it would be ranking asset managers into three tiers depending on the quality of their stewardship related disclosures and activities. Since that time we have maintained the highest tiering – Tier 1 – awarded by the FRC.

Module

2014 (Pilot)

2015

2016

2017

2018

Median manager 2018

 

 

Strategy & Governance

A

A

A+

A+

A+

A

 

Listed Equity Incorporation

A

A+

A+

A+

A+

B

 

Listed Equity Active Ownership

A

A

A

A

A+

B

 

Fixed Income SSA

B

B

A+

A+

A+

B

 

Fixed Income Corporate

A

A+

A+

A

A

B

 

Fixed Income Corporate Financial

N/A

N/A

A+

A

A+

B

 

Fixed Income Securitised

N/A

N/A

B

A

A+

C

 

Infrastructure

A

A

A+

A+

A+

A

 

 

"Since 2016 we have maintained the highest tiering – Tier 1 – awarded by the FRC for stewardship disclosures"

Independent Research in Responsible Investment Survey 2017

Each year SRI Connect and Extel conduct a global survey of responsible investment professionals asking them to vote in various categories. Recognition from peers is particularly valued by us and we thank all those that voted for us.

We were pleased to be voted 26th globally for having made the most positive contribution to responsible investment amongst asset management firms. Stewart Investors, who offer dedicated sustainable investment strategies were voted 14th in the category. Our responsible investment team were also highly regarded in the individual categories. 

CFA Institute's Code of Ethics and Standards of Professional Conduct

Since 2014 we have been fully compliant the CFA Institute's Code of Ethics and Standards of Professional Conduct for asset managers. In 2017 we reviewed our adherence to the code through our compliance process. The code is available to view on the CFA Institute website.

PLSA Stewardship Disclosure Framework

We also benchmark our practices against the UK's Pensions and Lifetime Savings Association (PLSA)) Stewardship Disclosure Framework. The framework provides an 'at a glance' comparison between the approaches of different asset managers. Our results are available on the PLSA website.

External Assurance of our Global Stewardship Principles

For the third year we received independent assurance against our Global Stewardship Principles and the UK Stewardship Code by PwC. The statement of assurance is available to clients on request.

"Since 2014 we have been fully compliant the CFA Institute's Code of Ethics and Standards of Professional Conduct for asset managers"

"For the third year we received independent assurance against our Global Stewardship Principles and the UK Stewardship Code by PwC. The statement of assurance is available to clients on request"

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