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Sycomore Asset Management

PRI reporting framework 2017

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Outputs and outcomes

LEA 11. Number of companies engaged with, intensity of engagement and effort

11.1. Indicate the amount of your listed equities portfolio with which your organisation engaged during the reporting year.

Number of companies engaged

(avoid double counting, see explanatory notes)

Proportion (to the nearest 5%)
Specify the basis on which this percentage is calculated

Individual / Internal staff engagements

56 Number of companies engaged
15 Proportion (to the nearest 5%)

Specify the basis on which this percentage is calculated

Collaborative engagements

0
0 Proportion (to the nearest 5%)

Specify the basis on which this percentage is calculated

11.2. Indicate the proportion of engagements that involved multiple, substantive and detailed discussions or interactions with a company during the reporting year relating to ESG issue.

Type of engagement

% Comprehensive engagements

 

 

Individual / Internal staff engagements

 

 

Collaborative engagements

11.3. Indicate the percentage of your collaborative engagements for which you were a leading organisation during the reporting year.

Type of engagement

% Leading role

 

 

Collaborative engagements

11.5. Additional information. [Optional]

Regarding collaborative engagements, Sycomore AM joined its first collaborative engagement in July 2016. The Human Capital Management (HCM) Coalition is a cooperative effort among a diverse group of institutional investors to further elevate human capital management as a critical component in company performance.

As the project was in its launching phase in 2016, we did not engage with companies in the framework of this collaborative engagement during the reporting year. 


LEA 12. Engagement methods

12.1. Indicate which of the following your engagement involved.

12.2. Additional information. [Optional]


LEA 13. Engagements on E, S and/or G issues

13.1. Indicate if your engagements in the reporting year covered E, S and/or G issues, providing an estimation of the breakdown.

Individual / Internal staff engagements

10 % Environmental only
35 % Social only
55 % Corporate Governance only
0 % Overlapping ESG issues
Total 100%

13.2. Additional information. [optional]

Our internal database dedicated to the monitoring of engagement activities allows us to link each engagement to the primarily concerned stakeholder (Supplier & Society, People, Investor, Customer, Environment).


LEA 14. Companies changing practices / behaviour following engagement

14.1. Indicate whether you track the number of cases during the reporting year where a company changed its practices, or made a formal commitment to do so, following your organisation’s and/or your service provider's engagement activities.

14.2. Indicate the number of companies that changed or committed to change in the reporting year following your organisation’s and/or your service provider's engagement activities.

Number of company changes or commitments to change

Individual / Internal staff engagements

2

Collaborative engagements

0

14.3. Additional information [Optional].

The part of our centralised database dedicated to the monitoring of engagement activities allows us to track achievements for each engagement. The engagement approach was formalized recently and we started a significant number of engagements this year. Although we began to see the very first results at the end of the year, it will take some years to reach a significant number of companies changing their practices.

Regarding collaborative engagements, Sycomore AM joined its first collaborative engagement in July 2016. The Human Capital Management (HCM) Coalition is a cooperative effort among a diverse group of institutional investors to further elevate human capital management as a critical component in company performance.

As the project was in its launching phase in 2016, we did not engage with companies in the framework of this collaborative engagement during the reporting year. 


LEA 15. Examples of ESG engagements

15.1. Provide examples of the engagements that your organisation or your service provider carried out during the reporting year.

Topic or ESG issue
          Employee satisfaction at a French logistics company
        
Conducted by
Objectives

Introduce an employee satisfaction survey to better understand and monitor employee satisfaction and social climate. 

Scope and Process

We met with the company's Investor Relation manager and asked whether the company had ever considered to conduct an employee satisfaction survey. We also explained our view on these surveys and how we think they can help to further develop and better monitor HR policy when used adequalty. As a first reaction, our interlocutor expressed his fear of a lack of interest and participation by employees. 

Outcomes

As we met again approximately one year later and followed-up on this topic, he explained that after discussing it internally the company had just conducted its first employee satisfaction survey. The next steps of this engagement for us will be to follow-up on the results of the survey and how they have been used, and see whether the company is able to extand the limited parameter used for the first survey over time. 

Topic or ESG issue
          Human Capital as a critical component of performance
        
Conducted by
Objectives

Further elevate human capital management as a critical component in company performance, in particular:

- Educate ourselves and other stakeholders about the role of Human Capital in company performance
- Engage companies about their Human Capital performance
- Encourage improved practices and disclosure
- Elevate board and senior management attention to Human Capital

Scope and Process

The scope is global but with a focus on the United States as most members of the coalition are based in the United States. Members of the HCM Coalition will lead the engagement on different target companies, draft letters signed by the members of the coalition, and report on the results. 

Outcomes

As the project was in its launching phase in 2016, we did not engage with companies in the framework of this collaborative engagement during the reporting year. 

Topic or ESG issue
          Governance practices at a French mass catering company
        
Conducted by
Objectives

The general objective of this engagement is to use the opportunity of the annual pre-AGM consultation to establish a long-term dialog on governance practices within the firm and encourage the adoption of best practices on various issues such as the alignement of interest through remuneration policy and board composition. 

Scope and Process

We participated in the pre-AGM consultation for the second time, following the same process. All suggestions were made during a call with Sycomore's governance team and the Director of IR and the Legal Counsel of the company, who directly pass the information on to the Board of Directors. We sent an email summarising the key points raised during our conversation to the company.

Outcomes

We noticed some improvements on issues raised during our last call, in particular: 
- executive remuneration: the company strenghtened the performance conditions on the CEO's severance payment. This change was made to address the concern raised by several investors including Sycomore during the last pre-AGM consultations concerning the stringency of the former performance conditions. 
- remuneration report: the company committed to further enhance the transparency of the report (in particular with regard to the rationale for levels of achievement of qualitative objectives)

Furthermore, we followed-up on our suggestions concerning the qualitative criteria for the CEO remuneration and board composition, on which there had been no evolution, and explained the rationale. 

 

 

Topic or ESG issue
          Environmental security at a French mining company
        
Conducted by
Objectives

Having detected the presence of certain operation sites of the company on a foreign governmental list of dangerous tailing dams, the objective of the engagement was to seek answers from the company on this situation and more generally on the management of past controversies on water pollution due to leaks in a tailing dam. 

Scope and Process

We met with the company's Head of Sustainability and Head of Investor Relations to address the issue. After gaining a better understanding of the situation, we pursued the engagement by exchanging emails with the company. 

Outcomes

The company confirmed it had contacted the concerned government to ask for the withdrawal of its sites from the list, which according to the company is not accurate, and explained how security had been reinforced since then. We encouraged the company to proactively pursue its efforts in terms of environmental security and its relationships with local communities and to further cooperate with the authorities to clear the situation regarding the classification of its sites as dangerous. 

15.2. Additional information. [Optional]


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