As a responsible, proactive asset manager, we maintain a constructive dialogue with the companies in which we invest. Our goal is to actively influence these companies with regard to their environmental, social and corporate governance (ESG) practices, thereby helping to improve the sustainability of their actions and increasing their enterprise value in the long term. To achieve this, we work closely with other companies in the Union Investment Group, who is hired as our service provider. First of all, this brings the advantage of participating with a unique “voice” within the Union Investment group. Besides, we have access to a dedicated team and communicate in an uncomplicated environmental.
Engagement is implemented through dialogue with companies via their engagement platform, UniVoice, and by voting in line with the guidelines at general meetings.
The engagement approach essentially consists of three stages: pre-engagement, actual engagement and post-engagement .
The pre-engagement stage and associated research lay the groundwork and detect any problem areas for our service provider engagement activities. In this stage, a group of professionals analyze and discussed the sustainability and weakness associated with the companies based on several research sources and the expertise of 42 sector analysts within the Union Investment.
In the engagement stage, a combination of constructive dialogue with companies (UnionVoice) and the exercising of our voting rights at annual general meetings (UnionVote) takes place.
These activities are accompanied by intensive global sustain ability research and studies on sustainability/engagement issues aimed at institutional investors.
Issues that are regularly addressed by our service provider at annual general meetings include:
• Corporate governance
• Corporate Actions
• investment performance
• controversial shareholdings
• CO2 emissions and the switch to renewable energy sources
• environmental issues
• social standards
The post-engagement process has a long time horizon, with results sometimes only becoming apparent after months or years. The engagement activities and their results are therefore evaluated at regular intervals. In terms of taking consequences for a company, It is not out of the question for engagement activities that have already been undertaken to be re-evaluated. If we are not satisfied with the responses and actions of certain companies in spite of our repeated engagement, the ESG committee can systematically exclude those companies from the investment universe.