The Board recognizes that strong corporate governance and responsible corporate behavior pertaining to environmental and social factors will generally contribute to better long-term financial performance of a company. This belief and the MPP approach to responsible investment are set out in sections 4.8 and 12 of our Statement of Investment Policies and Procedures ("SIPP"). These sections are set out below:
Section 4.8 - Investment Beliefs: The Board believes that companies that take environmental, social and governance (ESG) matters into account have less risk and generate long-term value for investors compared to companies with less robust practices.By applying these principles, the Board recognizes that effective research, analysis and evaluation of ESG issues are fundamental to assessing the value and performance of an investment over the long-term.
Section 12: Resposible Investing & Voting Rights
12.1 At all times, the Board’s responsible investing approach is to be conducted within the framework of fiduciary responsibility. It shall therefore be implemented in a manner which does not interfere with the efficient investment of the Fund’s assets to achieve investment return objectives, which are in the best financial interests of the Plan’s current and future beneficiaries.
12.2 Pursuant to Section 4.8 and subject to Section 12.1, favourable consideration is to be given by bcIMC and its investment managers to investment opportunities in corporations that meet or exceed all environmental regulations and aspire to reduce the impact of their operations on the environment, apply best practices for corporate governance, adopt good standards of safety and employee welfare, and be responsible in their operations by effectively managing relationships with suppliers, customers and communities.
12.3 In keeping with the Board’s fiduciary responsibilities and framework, the Board believes that environmental, social, and corporate governance (“ESG”) issues can affect investment performance to varying degrees across companies, sectors, regions, asset classes and through time. In this regard, the Board supports the UN-supported Principles for Responsible Investment, introduced in April 2006 (http://www.unpri.org/principles/). By applying these principles, the Board recognizes that effective research, analysis and evaluation of ESG issues is a fundamental part of assessing the value and performance of an investment over the long-term.
12.4 The Board delegates its voting rights to bcIMC and instructs bcIMC to act in the best financial interests of the Fund. In addition to proxy voting, the Board expects bcIMC to use shareholder engagement to encourage companies to focus on long-term value creation by effectively managing ESG risks that may emerge over time and materially affect the valuation of the company and/or asset. The Board believes that engagement is a more effective tool for seeking to initiate change to and influence corporate practices than divesting. The Board expects bcIMC, as an active and engaged investor, to encourage the companies within its portfolio to apply good corporate governance practices, effectively manage their business relationships, and be responsible in their operations. The Board further expects that bcIMC’s engagement activities are based on strategic ESG priorities and, as a result, ESG matters are addressed to the extent that they influence risk and return of the Fund.
12.5 bcIMC shall provide the Board with copies of its corporate governance guidelines and at least once a year the Board shall review bcIMC’s voting record.
bcIMC is our sole investment manager and they are also a signatory to the PRI as an investment manager.