The materiality of ESG factors varies between sectors. USS aims to research all factors that could have a material impact on the performance of a company and share price. This analysis is recorded on our RI Perspectives Report and is provided to the fund manager for discussion. The RI team also analyses thematic issues in collaboration with colleagues in the equities team, and external organisations such as GIGN, ACGA and the Investor Forum.
We take our stewardship responsibilities seriously and not all of the issues we analyse and spend time on are demonstrably material in financial terms over the short-term. For example some of the issues we analyse and engage upon relate to reputational risk which is hard to quantify.
This does not mean that they are not important: we will engage on long term issues even if they are not regarded as quantifiable at the time of the investment decisions. See the LEA stewardship section for more details. We believe that this multi-strategy approach to the management of ESG issues is in the best interest of our members.