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BlackRock

PRI reporting framework 2017

You are in Direct - Listed Equity Active Ownership » Engagement » Process » Process for engagements conducted via collaborations

Process for engagements conducted via collaborations

LEA 05. Process for identifying and prioritising collaborative engagement

New selection options have been added to this indicator. Please review your prefilled responses carefully.

05.1. Indicate whether your organisation has a formal process for identifying and prioritising collaborative engagements

05.2. Describe the criteria used to identify and prioritise collaborative engagements

05.3. Additional information [Optional]

In our experience, collective engagement by shareholders can be very effective on policy related issues such as transparency and disclosure (i.e. board disclosure on diversity policies) or enhancements of shareholder rights. However, collective engagement focused on value-related matters, such as strategic direction or company leadership, can be much more difficult to achieve collectively. In practice, collective action is difficult to manage given that shareholders tend to have a range of perspectives. In BlackRock's experience, even where there is agreement that a problem exists, it can be very difficult to agree a single course of action or timeframe in which it ought to be taken. This diversity of opinion is not a flaw in the system, but a strength as it brings a range of alternative solutions to the situation. Nonetheless, it is not always possible to reach a consensus and in many collective engagements shareholders ultimately take their own stance directly to the company. This is further exacerbated in markets with dispersed ownership. For these reasons and given our prioritization of engagements that are closely tied to long-term value, we only occasionally engage companies in collaboration with other investors.


LEA 06. Objectives for engagement activities

New selection options have been added to this indicator. Please review your prefilled responses carefully.

06.1. Indicate if you define specific objectives for your engagement activities carried out collaboratively.

06.2. Indicate if you monitor the actions companies take following your collaborative engagements.

06.3. Indicate whether your organisation defines milestones and goals related to engagement activities carried out via collaborations.

06.5. Additional information. [Optional]

While our firm may not define the milestones and goals related to engagement activities carried out via collective engagement, we do track and monitor progress against defined milestones and goals in order to evaluate the progress of collaborative engagement activities when we are a participant.


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