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Alliance Bernstein

PRI reporting framework 2018

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You are in Direct - Listed Equity Active Ownership » Engagement » Process

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]

Engagement is an important component of our approach to active ownership and a part of our standard investment research process. In addition, we conduct engagements focused on ESG and proxy issues. In late 2015, we began development of an engagement framework to determine priorities while at the same time providing flexibility to address ad hoc issues appropriately.   The framework has both quantitative and qualitative inputs.  We referenced it for engagements in 2016, and refined it in practice. We published a formal engagement policy in 2017. It includes a more structured engagement framework for identifying and prioritizing engagement. It is based on quantitative metrics, such as, but not limited to, position size, and qualitative ESG issues as well as our proxy voting history.

 

 


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 during and following your engagements activities carried out by internal staff.

04.3. 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

          As part of our engagement framework we review previous engagements as well as our proxy voting history.
        

04.4. Additional information. [Optional]

A number of investment teams monitor progress against defined objectives. We are in the process of rolling this out more broadly going forward.


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.

other description

          Consultation with RI related organisations.
        

05.3. Additional information [Optional]

We participated in our first collaborative engagement in 2015 under the PRI's collaborative engagement on human rights issues in the extractives industry. We are a co-lead for a company. We continued the dialogue with the company in 2016 and carried on in 2017. We plan to use this experience to determine how and when collaborative engagements could be useful. In additional to that, we  published a formal engagement policy in  2017. It includes a more structured engagement framework for identifying and prioritizing engagement which encompasses potential collaborative engagements. It is based on quantitative metrics, such as, but not limited to, position size, share register ranking, and qualitative ESG issues. This also informs our process for identifying and prioritising collaborative engagements.

 


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 during and following your collaborative engagements.

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

06.4. Additional information. [Optional]

As noted above, we started in our first collaborative engagement in 2015. This engagement is currently still on-going in 2017. We are selecting a new collaborative engagement aligned with our priorities. 


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]

As noted above, insights garnered from our engagements with issuers are a key component of, and sometimes even a material aspect of, our analysts’ research recommendations and investment theses on an issuer. Such insights are discussed with our portfolio management teams and directors of research in regular research review meetings, and, depending on the item, may certainly influence our ultimate investment decision on the issuer.


LEA 10. Tracking number of engagements

10.1. Indicate if you track the number of your engagement activities.

Type of engagement
Tracking engagements

Individual / Internal staff engagements

Collaborative engagements

10.2. Additional information. [OPTIONAL]

We track company meetings in our global company calendar. This includes the majority of our company engagements held at our offices. It does not track the specific meeting agenda or items discussed, such as ESG topics.

In 2013, we introduced an engagement database to capture specific ESG-related engagements and ESG integration examples. Given the volume of our analysts’ interactions with companies, and the wide variety and materiality of ESG issues they discuss, we do not capture every single discussion. Instead, we focus on the most significant engagements.  In 2017, we tracked 117 meetings. 

In addition, in fourth quarter in 2014, our RI team started tracking proxy related engagements. For 2016, this totalled 66 issuers during the year and 56 in 2017. Please note this does not include engagements from the investment teams which focussed solely on ESG issues.  


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