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Martin Currie Investment Management

PRI reporting framework 2018

You are in Direct - Listed Equity Active Ownership » Engagement

エンゲージメント

概要

LEA 01. Description of approach to engagement

この指標には新しい設問が追加されています。事前に入力されている回答を精査してください。

01.1. 貴社に正式なエンゲージメントポリシーがあるかどうか示してください

01.2. エンゲージメントポリシーのファイルの添付、もしくはURLを記載してください。

01.3. エンゲージメントポリシーがカバーしている内容を示してください。

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

We believe monitoring and engagement are an essential part of being a shareholder in a company. It allows us to improve our understanding of investee companies and their governance structures, so that our voting decisions may be better informed and allows us to understand to what extent companies have identified material ESG risks and how they are managing these. The materiality and immediacy of a given issue will generally determine the level of our engagement.

To identify areas in which there are concerns we use a range of resources - our own fundamental research, ESG-specific research, research by investment banks and external governance specialists.

The main objectives of our engagement activities are:

to enhance our conviction in investee companies
to understand management incentives
to identify and share best practice
to improve corporate practice
ultimately to seek improved outcomes for all stakeholders

Our practice is to engage not only with the management of companies but also with a raft of other stakeholders for each particular business. These include government agencies focusing on areas that are material to a particular region or company.

Our engagements are recorded on our research portal and shared across the investment team.

01.6. Additional information [optional]


LEA 02. Reasoning for interaction on ESG issues

02.1. エンゲージメントの方法および対話を行う理由を明示して下さい。

エンゲージメントの種類
対話を行う理由​
Individual/Internal staff engagements
Collaborative engagements
          As an opportunity deepen our knowledge and learn more about the particular topics
        
Service provider engagements

サービスプロバイダーを通じて関与しない理由を明記してください。(最大200語)

As stewards of our clients capital effective engagement is a key part of our role as responsible investors for these clients.  As such we believe that engagement led by the portfolio managers and analysts, either via private or collaborative engagements, is the most effective way to persue this rather than outsourcing this to an external provider.   

02.2. Additional information. [Optional]

We believe monitoring and engagement are an essential part of being a shareholder in a company. It allows us to improve our understanding of investee companies and their governance structures, and allows us to understand to what extent companies have identified material ESG risks and how they are managing these risks.  It also ensures that our voting decisions may be better informed. The materiality and immediacy of a given issue will generally determine the level of our engagement.

The main objectives of our engagement activities are:
 • to enhance our conviction in investee companies
 • to understand management incentives
 • to identify and share best practice
 • ultimately to improve corporate practice

Our practice is to engage not only with the management of companies but also with other stakeholders for a particular business. These include government agencies focusing on areas that are material to a particular region or company.

Members of our investment team hold regular meetings with the management of the companies in which we invest to discuss strategy, sustainability and performance, and to review management processes against the principles and best practice.
At a minimum we would expect companies to comply with the accepted corporate governance standard in their domestic market or to explain why doing so is not in the interest of shareholders. We believe that well-managed companies will report on material social and environmental risks and opportunities and explain how these are managed. As these are often not voting issues, we may engage directly with the company management or board where we believe there is the potential for a material impact on shareholder returns.
We adopt a case-by-case approach to engaging on material governance, environmental or social issues. We will engage with management in an appropriate manner and make a record of this engagement - this may be by conference call, letter or by seeking access to the board chair or directors.
We also aim to participate in collaborative engagement where appropriate.
In most cases a robust private dialogue with executive management, non-executive directors and company advisors is our preferred way to protect our clients' interests. We will also engage with the chairman of the board or the Senior Independent Director where appropriate.

 


プロセス

貴社内で実行するエンゲージメントのプロセス

LEA 03. Process for identifying and prioritising engagement activities

この指標には新しい設問が追加されています。事前に入力されている回答を精査してください。

03.1. 貴社内のスタッフが実行するエンゲージメント活動を特定し、優先順位を決定する正式なプロセスが貴社にあるかどうか示してください。

03.2. 貴社内のスタッフが実行するエンゲージメントを特定し、優先順位を決定する際に使用する基準を説明してください。

03.3. Additional information. [Optional]

When looking at ESG factors our focus is always on relevance and materiality. Our frame of reference for identifying issues is our Global Corporate Governance Principles which outlines our approach to corporate governance and what we see as best practice, our Stewardship Code statement and our Responsible Investment Policy. In general, the analyst responsible for the stock will set the priorities for engagement, however our external service providers, for example ISS, Ownership Matters or MSCI will also highlight particular issues that they believe should be focused on. They will again identify issues based on their policy framework and will prioritise based on materiality and immediacy.

Where companies deviate from these principles, fall short of what see as strong practice, there is an opportunity to nudge a company in the right direction or where an issue requires clarification we will look to engage with the board or the management of the company. The materiality and immediacy of a given issue will generally determine the level of our engagement and the priority we will attach to it. There are some common systemic factors that also frame our engagement.  An issue where the impact on the potential value of an investment is large or where the timescale is short will be given high priority.

We will engage with management in an appropriate manner and make a record of this engagement - this may be by conference call, letter or by seeking access to the board chair or directors.
 


LEA 04. Objectives for engagement activities

この指標には新しい設問が追加されています。事前に入力されている回答を精査してください。

04.1. 貴社内のスタッフが実行する貴社のエンゲージメント活動に具体的な目的を定義しているかどうかを記載してください。

04.2. 貴社内のスタッフが実行する貴社のエンゲージメントを受けた企業の行動をエンゲージメント中および後で監視しているかどうかを記載してください。

04.3. 貴社内のスタッフが行うエンゲージメント活動の進捗を監視のうえ評価するために以下のいずれかを実施しているかどうか示してください。

04.4. Additional information. [Optional]

When considering engagement with an investee company we are clear about what we are looking to achieve.

The main objectives of our engagement activities are:
 • to enhance our conviction in investee companies
 • to understand management incentives
 • to identify and share best practice
 • ultimately to improve corporate practice

As such the approach we take will vary depending on the desired outcome.  Where there is an objective of enhancing our understanding of the structures, motivations or strategy of a company we will not establish defined milestones or goals.

Where we are looking to encourage better corporate practice e.g. improved disclosure or changes to corporate behaviour we will outline our reasoning, set out our expectations and consider what should be an appropriate timeline for resolution.

Our process on tracking engagement is overseen by David Sheasby our Head of Stewardship and ESG.

The investment team meets on a daily basis with a focus on read-across from one company to another - this ensures that lessons learned from any engagement on a particular issue are disseminated quickly and effectively to the broader team. Our internal research portal provides access to all company research and company contact by one analyst for the broader team.


協働によって実施されたエンゲージメントのプロセス

LEA 05. Process for identifying and prioritising collaborative engagement

この指標には新しい設問が追加されています。事前に入力されている回答を精査してください。

05.1. 協働的なエンゲージメントを特定し、優先順位を決定する正式なプロセスが貴社にあるかどうか示してください。

05.2. 協働的エンゲージメントを特定し、優先順位を決定する際に使用する基準を説明してください。

05.3. Additional information [Optional]

While the majority of engagement is private we also aim to participate in collaborative engagement where appropriate.

We monitor collaborative engagement programs - for example those run by the PRI or the Investment Association / Investor Forum and will look to prioritise those where we believe an issue is relevant and material. An issue where the impact on the potential value of an investment is large or where the timescale is short will be given high priority. We will also prioritise those collaborative engagements where we believe we can make a material contribution to the overall engagement - for example leveraging our extensive expertise and company relationships in Emerging Markets. In some cases, collaborative engagements provide an opportunity to learn and deepen our expertise on issues that we consider to be pertinent both regionally and globally.

Examples of the collaborative engagements we have selected to participate in:

Martin Currie was on the steering committee for the PRI collaborative engagement on fracking disclosure. The objective of this collaborative engagement was to improve disclosure and adoption of best practice in those companies involved in the fracking industry - notably community support, water quality and use, air emissions and the governance of procedures as the key areas of concern. We believe there is an investment opportunity from being a responsible company and adopting the best available technology and procedures. We believe the benefits may include a better reputation, sustainable earnings, greater productivity and efficiency and lower costs. We found an overall lack of disclosure in the industry around the related risks from fracking. In this case we have been able to leverage our Emerging Market and Energy sector expertise. This collaborative engagement has successfully concluded.

Martin Currie was also involved in the collaborative engagement on labour relations and led the engagement with one of the targeted companies. This engagement was aiming to improve company practices and enhance company disclosure regarding employee relations within the retail industry. This was an ideal opportunity to achieve some of the improvements desired and our excellent relationship with the company helped the process.

Martin Currie also participated in first the collaborative engagement on water risks in agricultural supply chains. We were interested in this as we believe it is likely to become an increasingly important area of focus for investors. This engagement targeted food, beverage, apparel, retail and agricultural companies based on their exposure to water risks. The aim was to gain an understanding of the degree to which companies are aware of the risks, understand to what extent the companies measure or assess water risks in their key agricultural supply chains, assess the material value of these risks, how the companies are responding and examine what information the companies disclose. Our significant experience in Emerging Markets and our broader engagement experience put us in a strong position to contribute to this engagement and we therefore led it with a number of targeted companies.

Martin Currie was also on the steering forum for the collaborative engagement on cybersecurity. Cybersecurity is an area where we see significant potential risks as well as opportunities and has come under increased scrutiny in the aftermath of recent high profile cases. This engagement will focus on the governance and disclosures around cybersecurity and the steering forum established the terms and target companies for the engagement. We are now leading the engagement with a number of the target companies.

Most recently Martin Currie has joined the collaborative engagement on corporate tax responsibility. Aggressive tax practices can present earnings, reputational and legal risks for investors’ portfolio companies.  This engagement aims to make companies aware that investors are concerned about aggressive corporate tax practices, encourage the development of responsible corporate tax strategies and relevant implementation practices, improve company disclosure across policy, governance and financial reporting and identify existing best practices.  We will be leading the engagement on a number of companies where we already have strong relationships.

Through FAIRR and ShareAction we are also supporting the collaborative engagement on Anti-microbial resistance as it pertains to factory farming and anti-biotic use in the food supply chain. According to estimates, approximately 50% of antibiotics used in the UK and 80% of antibiotics in the US are given to farm animals. This has been recognised by the World Health Organisation (WHO) as contributing to an emerging global threat of a post-antibiotic era, in which common infections and minor injuries can once again kill humans. Non-therapeutic use of antibiotics is particularly widespread in factory farms, where crowded conditions and build-ups of waste can make animals more prone to infection. A recent report commissioned by the UK Prime Minister found that drug resilient infections could kill an extra 10 million people every year by 2050, costing the world around US $100 trillion in lost output.

The key objective of the engagement is to build awareness of the issue and encourage the development of a comprehensive policy, with timelines identified, to phase out the prophylactic use of medically-important antibiotics across the global supply chains for a number of companies identified as having the most exposure to this issue.


LEA 06. Objectives for engagement activities

この指標には新しい設問が追加されています。事前に入力されている回答を精査してください。

 

06.1. 貴社が関与する協働的なエンゲージメントに目的が定義されているかどうか示してください。

06.2. 貴社の協働的なエンゲージメントを受けた企業の行動をエンゲージメント中および後で監視しているかどうかを記載してください。

06.3. 貴社の協働エンゲージメント活動の進捗を監視し、評価するために以下のいずれかを実施しているかどうか示してください。

06.4. Additional information. [Optional]

Martin Currie participates in a number of the PRI lead collaborative engagements.  The structure of these is very clear in terms of:

  • agreeing the objective of the engagements
  • educating participants in the most important aspects of the topic
  • identifying leaders for each of the specific company engagements
  • setting out an appropriate timeline to achieve the objectives
  • providing the forum for regular feedback, learning and sharing of best practice

Martin Currie was on the steering committee for the PRI collaborative engagement on fracking disclosure. The objective of this collaborative engagement was to improve disclosure and adoption of best practice in those companies involved in the fracking industry - notably community support, water quality and use, air emissions and the governance of procedures as the key areas of concern.

We believe there is an investment opportunity from being a responsible company and adopting the best available technology and procedures. We believe the benefits may include a better reputation, sustainable earnings, greater productivity and efficiency and lower costs. We found an overall lack of disclosure in the industry around the related risks from fracking.

The engagement aimed to improve companies' disclosure and encourage the adoption of best practices in several areas:
 • Governance - Board oversight/policies/procedures/R&D
 • Water management - Use and contamination
 • Air emissions
 • Community - Impact and consent

The engagement has now successfully concluded and an investor guide has been produced.

Martin Currie was also involved in the collaborative engagement on labour relations and led the engagement with one of the targeted companies. This engagement aimed to improve company practices and enhance company disclosure regarding employee relations within the retail industry.  Once again we believe this is an area where we are able to make a clear contribution to the engagement.

This engagement was focused on three objectives:

  • Encourage improved company practice
  • Encourage enhanced company assessment and reporting
  • Heighten board and senior management attention of the issue

Martin Currie also joined the collaborative engagement on water risks in agricultural supply chains. This engagement targeted food, beverage, apparel, retail and agricultural companies based on their exposure to water risks. The aim was to gain an understanding of the degree to which companies are aware of the risks; understand to what extent the companies measure or assess water risks in their key agricultural supply chains; assess the material value of these risks, how the companies are responding and examine what information the companies disclose. Our significant experience in Emerging Markets and our broader engagement experience put us in a strong position to contribute to this engagement and we therefore led it with a number of targeted companies.  The first round of this engagement has now concluded and an investor guide is due to be published.

Martin Currie was also on the steering forum for the collaborative engagement on cybersecurity.  Cybersecurity is an area where we see significant potential risks as well as opportunities and has come under increased scrutiny in the aftermath of recent high profile cases. This engagement will focus on the governance and disclosures around cybersecurity and the steering forum will establish the terms and target companies for the engagement.  Given our global equity experience and knowledge of a number of the companies concerned we are leading the engagement with a number of the target companies.

Most recently Martin Currie has joined the collaborative engagement on corporate tax responsibility. Aggressive tax practices can present earnings, reputational and legal risks for investors’ portfolio companies.  This engagement aims to make companies aware that investors are concerned about aggressive corporate tax practices, encourage the development of responsible corporate tax strategies and relevant implementation practices, improve company disclosure across policy, governance and financial reporting and identify existing best practices.  We will be leading the engagement on a number of companies where we already have strong relationships.


サービスプロバイダーと共同で、または、サービスプロバイダーが貴社のために

エンゲージメントを行っている3つのグループすべてに対する一般的なプロセス

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

09.1. エンゲージメントから得た考察を、貴社内の運用担当者や貴社外の運用会社と共有しているかどうかを記載してください。

エンゲージメントの種類

共有する考察
単独/貴社内のスタッフのエンゲージメント

協働的なエンゲージメント

09.2. Additional information. [Optional]

Our focus is always on relevance and materiality when looking at ESG factors. Our ESG engagement forms part of our broader engagement with companies described in previous sections. Where we have identified a particular issue the objective of the engagement is set by the analyst responsible for the stock. We record these engagements on our internal research portal. Responsibility for tracking these engagements lies with the analyst responsible for the company analysis. The review process is looked at on a case-by-case basis and will depend on the immediacy and materiality of the issue. There is a mandatory annual review of all research relating to companies held in portfolios which will include any engagements on material issues but typically they are reviewed more frequently.

The investment team meets on a daily basis with a focus on read-across from one company to another - this ensures that lessons learned from any engagement on a particular issue are disseminated quickly and effectively to the broader team. Our internal research portal also provides access to all company research and company contact by one analyst for the broader team.

Our process on tracking engagement is overseen by David Sheasby, our Head of Stewardship and ESG.


LEA 10. Tracking number of engagements

10.1. 貴社がエンゲージメントの数を追跡しているかどうかを記載してください。

エンゲージメントの種類
エンゲージメントの追跡
単独/貴社内のスタッフのエンゲージメント

協働的なエンゲージメント

10.2. Additional information. [OPTIONAL]

Our process on tracking engagement is overseen by David Sheasby, our Head of Stewardship and ESG.

Our focus is always on relevance and materiality when looking at ESG factors. Our ESG engagement forms part of our broader engagement with companies described in previous sections. Where we have identified a particular issue the objective of the engagement is set by the analyst responsible for the stock. We record these engagements on our internal research portal. Responsibility for tracking these engagements lies with the analyst responsible for the company analysis. The review process is looked at on a case-by-case basis and will depend on the immediacy and materiality of the issue. There is a mandatory annual review of all research relating to companies held in portfolios which will include any engagements on material issues but typically they are reviewed more frequently.

Our internal research portal also provides access to all company research and company contact by one analyst for the broader team.

Where we are involved in collaborative engagement, for example with the PRI on the water in the agricultural supply chain, we will play an active role and therefore monitor the engagement in full. In this particular case for example we are leading the engagement with a number of the companies identified in the program.

We provide a summary of our overall engagements in our Stewardship Annual Report (available on our web-site) and also provide examples of some of the engagements that we have been involved with.  When tracking engagements, we look at the topic, the objective and the result.


成果および結果

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


LEA 12. Engagement methods (Private)


LEA 13. Companies changing practices / behaviour following engagement (Private)


LEA 14. Examples of ESG engagements (Private)


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