Note that in addition to screening, the active equity team aims to work with management teams and encourage and support change. We believe this is a much more effective way to build an ESG mind-set. Our aim is that ESG and mainstream investing merge and in the mid-term, all investing is executed with this mind-set.
Dialogue with companies is a fundamental aspect of our stewardship commitment. We focus on material issues that are pertinent to the specific company and engagement strategies are regularly reviewed to ensure we are effective in achieving the desired outcomes.
These engagement may lead to further action and disclosures by companies which can be in a variety of forms to improve ESG performance. For example, engagement might have led to the prevention of a poor remuneration policy being put to a shareholder vote or better reporting on climate strategy.
These outcomes are then recorded on a bespoke data management system (Salesforce) to ensure that there is a clear audit trail of the successful engagement process. Therefore, the determinants of the outcomes are specific to the company and dependent on the ESG issues facing the company.