This report shows public data only. Is this your organisation? If so, login here to view your full report.

Sparinvest S.A.

PRI reporting framework 2017

Export Public Responses
Pdf-img

You are in Direct - Listed Equity Active Ownership » Engagement

Engagement

Overview

LEA 01. Description of approach to engagement

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

01.1. Indicate whether your organisation has a formal engagement policy.

01.2. Indicate what your engagement policy covers:

01.3. Attach or provide a URL to your engagement policy. [Optional]

01.4. Provide a brief overview of your organization’s approach to engagement

Engagement at Sparinvest seeks to be a respectful and constructive dialogue with investee companies, focussed on cases where we see potential for meaningful impact on corporate value and sustainability. Engagements are typically direct, collaborative, by service providers or a combination of these. 

Direct Engagement is by members of our investment teams who can best contextualise issues within the overall investment case and corporate value. 

Triggers include: 

  • Specific ESG Risks or Opportunities:
    Based on materiality and the potential for meaningful change. 
  • Voting-related:
    Where agenda items are contentious or in breach of voting policy. 
  • Breach of International Norms:
    In conjunction with our Service Provider (see below) 

Collaborative Engagement is typically via industry bodies such as the PRI Clearinghouse. Our level of involvement is a function of our specific relationship with the target company and our available resources. 

Service Provider Engagement is selected where companies are alleged or confirmed to have breached normative principles, such as the UN Global Compact. We directly engage with affected holdings to indicate concern and encourage response. The aim is to seek deeper understanding and suggest any appropriate remedial actions and policy improvements. 

01.5. Additional information [optional]


LEA 02. Reasoning for interaction on ESG issues

02.1. Indicate the method of engagement, giving reasons for the interaction.

Type of engagement

Reason for interaction

Individual/Internal staff engagements

          To discuss voting related issues.
        

Collaborative engagements

Service provider engagements

02.2. Additional information. [Optional]

As part of our investment analysis and monitoring, our investment teams frequently communicate with companies to bolster their understanding. The ideal is constructive, two-way dialogue with our holdings, with freedom to exchange views on key issues, whether short or long-term, ‘ESG’ or otherwise.

However, we classify as ‘engagements’ those dialogues with a specific goal. We take a practical and materiality-based approach, focussed on cases where we see potential for meaningful impact on corporate value and sustainability. Triggers for engagement, and the methods used, can differ on a case-by-case basis and often they overlap.

Engagements are monitored by the Responsible Investment Committee. The equity investment team holds a quarterly Stewardship Meeting on voting and engagement, which is chaired by the equity portfolio manager also serving on the RI committee, and attended by the Head of RI

We aim to provide insight into our engagement programme through regular disclosure of the number and type of engagements carried out, as well as specific examples. These are typically provided in our regular RI Review, found on our website”.


Methods of Engagement:
Engagements with companies are typically either direct, collaborative, or by service providers. We often find a combination of these to be powerful. Generally, we aim to act as constructive partners to our investee companies, and this means we may also bring third parties into the dialogue – for example, liaising between the company and an NGO regarding best practice on a specific issue. 


Direct Engagement
Members of our investment teams implement direct engagements. Our portfolio managers and analysts run the dialogue on ESG (and other) issues, as they well placed to contextualise the specific issue within the overall investment case and corporate value. It also sends a clear message to the investee company that ESG issues run to the heart of investment decisions. Triggers for direct engagement include:

 

Specific ESG Risks or Opportunities
Various ESG risks and opportunities are identified in analysis and monitoring of potential and existing holdings. Issues are selected for engagement based on materiality and the potential for meaningful change. 


Voting-related: 
Votes are blunt tools, which we believe are more powerfully exercised in conjunction with dialogue. We seek to engage with companies where agenda items breach our voting policy or are contentious for other reasons. Where time permits, this happens before the ballot. 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.


Breach of International Norms: 
This links with our service provider engagement policy, described below


Collaborative Engagement
Collaboration with other institutional investors provides and efficient and powerful avenue for engagement. Our involvement ranges from acting as lead investors (running the dialogue on behalf of a wider group of investors) to acting as supporting investors. The appropriate level of involvement is determined by assessing our specific relationship with the target company and our available resources. We typically become involved in via industry bodies such as the PRI Clearinghouse.


Service Provider Engagement
We make use of service providers for engagement where their specialist insight may inform a more constructive dialogue.  We use ISS-Ethix to screen for companies that are alleged or confirmed to have breached international conventions such as the UN Global Compact or the UN Guiding Principles on Human Rights. Where this screen identifies confirmed or alleged breaches, we participate in collaborative engagement along with other institutional investors, led by the service provider ISS-Ethix. The aim is to seek deeper understanding and, if appropriate, to suggest possible remedial actions and policy improvements.  Alongside this, we directly engage with our affected holdings to highlight the issue, encourage them to respond comprehensively to the collaborative engagement, and address any issues of specific concern to us.


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.

other description

          For efficacy, we may focus some engagements on specific themes/countries, where we see positive context for change (tailwinds of governance reform, etc)
        

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.

04.5. Additional information. [Optional]


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]


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]


Process for engagements conducted with/on your behalf by service providers

LEA 07. Role in engagement process

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

07.1. Indicate if you play a role in the engagement process that your service provider conducts on your behalf.

07.2. Indicate the role(s) you play in engagements that your service provider conducts on your behalf.

07.3. Additional information. [Optional]

Our main route of service provider engagement is via ISS-Ethix, engaging with companies involved in normative breaches. At a general level we have input into the criteria which determine the companies to be engaged with. We also aim for internal staff engagement directly with holdings which are covered by this service provider engagement, often to encourage the company into a more constructive dialogue with the service provider. Sparinvest’s investment professionals review the service provider’s engagement activities on an ongoing basis and regularly have detailed exchanges with the service provider regarding specific engagements.


LEA 08. Monitor / discuss service provider information

08.1. Indicate whether you monitor and/or discuss the following information provided to you by your service provider

Please select all that apply

08.2. Additional information. [Optional]


General processes for all three groups of engagers

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


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

Service provider engagements

10.2. Additional information. [OPTIONAL]

As mentioned before we have an engagement database where all engagement activities are tracked.


Outputs and outcomes

LEA 11. Number of companies engaged with, intensity of engagement and effort (Private)


LEA 12. Engagement methods (Private)


LEA 13. Engagements on E, S and/or G issues (Private)


LEA 14. Companies changing practices / behaviour following engagement (Private)


LEA 15. Examples of ESG engagements (Private)


Communication

LEA 16. Disclosure of approach to ESG engagements

16.1. Indicate whether your organisation proactively discloses information on its engagements.

16.2. Indicate if the information disclosed to the public is the same as that disclosed to clients/beneficiaries.

16.3. Indicate what engagement information your organisation proactively discloses to clients/beneficiaries and/or the public.

Engagement information disclosed

          Our engagement policy explains the overarching principles and processes.
        

16.4. Indicate how frequently you report engagements information.

16.8. Additional information. [Optional]


Top