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Colonial First State Global Asset Management (including First State Investments)

PRI reporting framework 2017

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Process

Process for engagements run internally

LEA 03. Process for identifying and prioritising engagement activities

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

03.1. Indicate whether your organisation has a formal process for identifying and prioritising engagement activities carried out by internal staff.

03.2. Describe the criteria used to identify and prioritise engagement activities carried out by internal staff.

03.3. Additional information. [Optional]


LEA 04. Objectives for engagement activities

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

04.1. Indicate if you define specific objectives for your engagement activities.

04.2. Indicate if you monitor the actions that companies take following your engagements.

04.3. Indicate whether your organisation defines milestones and goals for engagement activities carried out by internal staff.

04.4. Indicate if you do any of the following to monitor and evaluate the progress of your engagement activities carried out by internal staff.

other description

          Engagement progress is incorporated into stock notes / quality assessments
        

04.5. Additional information. [Optional]

Engagement is governed by our engagement and proxy voting guidelines and global stewardship principles. Each team has its own process for setting objectives and monitoring engagements with all teams either doing one or more of the following:

  • Maintaining a company meeting database
  • Incorporating engagement outcomes in stock notes
  • Discussing engagements in regular team meetings (teams meet between two and five times a week)

When surveyed:

4.1 - One team set objectives for all engagements, three teams set objectives for the majority of engagements, three teams set the objectives for the minority of cases and one team does not set objectives.

4.2 - Three teams monitor company action in all cases and four do so in the majority of cases.

4.4 - One team defines and sets timelines milestones and goals, two track progress, one revises and revisits goals on a continuous basis, and four incorporates engagement outcomes into stock notes / quality assessments.


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

05.3. Additional information [Optional]

We are currently developing a framework for identifying and prioritising collaborative engagements in Australia. 


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.

06.4. Indicate if you do any of the following to monitor and evaluate the progress of your collaborative engagement activities.

06.5. Additional information. [Optional]

When evaluating engagements we consider whether the company has changed the behaviour in question or whether it provided sufficient information to reassure us that the issue is being adequately managed. We also consider whether the process has added to our understanding of the industry, companies or issues in question.

When agreeing to participate in a collaborative engagement the relevant investment team undertakes to follow up with the company in individual meetings and to monitor progress. We have been concerned that letter writing campaigns without individual investor follow-up may ultimately undermine the effectiveness of collaborative engagements.

We are currently developing a framework for identifying and prioritising collaborative engagements in Australia. 


General processes for all three groups of engagers

LEA 09. Share insights from engagements with internal/external managers

09.1. Indicate if insights gained from your engagements are shared with your internal or external investment managers.

Type of engagement

Insights shared

Individual/Internal staff engagements

Collaborative engagements

09.2. Additional information. [Optional]

ESG engagement and proxy voting is performed by the relevant analysts and portfolio managers not by a separate team. As a result analysis of ESG issues which can influence an investment decision can also influence engagement and proxy voting activities or visa-versa. We strongly believe this integrated approach to company analysis and stewardship is critical to the full and consistent application of responsible investment principles. 

For collaborative engagements, progress is incorporated by the team(s) involved, however we only share the information with other teams where we believe the engagement is relevant to them. 


LEA 10. Tracking number of engagements

10.1. Indicate if you track the number of engagements your organisation participates in.

Type of engagement
Tracking engagements

Individual / Internal staff engagements

Collaborative engagements

10.2. Additional information. [OPTIONAL]

In terms of tracking individual engagements, five teams track the number of engagements in full, one team partly tracks the number of engagement, one indicated that they don’t track engagements but could provide a reasonable estimate and one did not track engagements.

In many cases engagement occurs as part of the ongoing relationship with companies that can take years to develop. For the most part ESG meetings are not held separately to meetings discussing the financial performance of the company and so for some teams narrowing engagements to ESG related interactions is not possible.

Each team has its own process for monitoring engagements with all teams either doing one or more of the following:

  • Maintaining a company meeting database
  • Incorporating engagement outcomes in stock notes
  • Discussing engagements in regular team meetings (teams meet between two and five times a week)

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