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Sparinvest S.A.

PRI reporting framework 2017

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Overview

LEA 17. Voting policy & approach

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

17.1. Indicate whether your organisation has a formal voting policy.

17.2. Indicate what your voting policy covers:

17.3. Attach or provide a URL to your voting policy. [Optional]

17.4. Provide a brief overview of your organization’s approach to (proxy) voting.

Sparinvest votes in accordance with its internal voting policy. We receive voting related research from proxy voting service provider ISS, and perform a triage of agenda items, considering the agenda, our voting policy, and the ISS analysis. Where a vote against an agenda item appears appropriate, or the matter is complex or controversial, the matter is referred to the relevant Portfolio Manager for a final decision. The voting instruction is then executed in line with our internal decision, via the ISS platform. An automated voting monitoring system from our proxy services provider enables us to ensure that votes have been cast according to our instructions. 

Votes are blunt tools, which we believe are more powerfully exercised in conjunction with dialogue. We seek to engage with companies where we vote against management recommendation. Where possible, this is done before our vote instruction, but the realities of a hectic proxy voting voting season mean that in some cases the communication follows the voting instruction. Outcomes can include the company amending the agenda to our satisfaction, a change in our voting decision based on new information from the company, or a vote against the item followed by further dialogue.

17.5. Provide an overview of how you ensure your voting policy is adhered to, giving details of your approach when exceptions to the policy are made (if applicable).

An automated voting monitoring system from our proxy services provider enables us to ensure that votes have been cast according to our instructions. We regularly monitor that we are voting our shares.

Our voting policy consists of various specific principles, but note that we consider all situations on a case-by-case basis, and voting decisions may deviate from certain principles where dictated by the best interests of our investors. In this respect, it is important to note that we do not view voting as a standalone issue, but rather as being inherently linked to dialogue. It some cases, it may be that when taken in the context of our engagement with a company, we may choose to vote in favour on an item that we may otherwise have opposed. An example would be where we are encouraging the company to increase board independence levels, and are aware of serious efforts by the company to find suitable independent candidates, but where a suitable candidate has not been found in time for the current AGM: in such a situation, where our thoughts on board structure have already been made clear to the company, and serious efforts are underway, we may prefer not to cause unnecessary disruption by voting against current board candidates, but instead choose to abstain, or even to support, the current candidates – but on the clear understanding that this may change if the expected progress is not delivered in the near future.

The head of responsible investment reviews a sample of voting decisions to ensure compliance with the voting policy.


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