Our stewardship and engagement work can be divided into the following types:
1. Promoting improved practices and transparency on ESG issues
We focus on engagement with companies to strengthen governance structures, introduce sustainability policies, processes and disclosures, for companies to manage effectively their most material ESG-risks. Impax has developed a proprietary cost-effective framework to advise companies on how to develop robust, material and cost-effective sustainability reporting.
2. Bottom-up company specific monitoring and dialogue
As part of our on-going, proprietary company-level ESG analysis, we identify company-specific issues and risks and actively engage with companies regarding these issues, as part of monitoring and managing risks.
3. Top-down strategic engagement priorities
Every year we assess and state the engagement priorities for the next 12 months, based on market developments and emerging ESG and sustainability issues that we have identified and that are relevant and material for our companies. We then identify the companies most exposed to the issues in question and focus our engagement on those companies. We engage with companies of all sizes, including larger companies with the intent of promoting best practices throughout an industry peer group.
We also initiate or support shareholder proposals at annual shareholders meetings to encourage greater corporate transparency around a company’s most significant environmental or social risks based on its sector and activities. In recent years, we have filed or co-filed shareholder proposals at companies on issues relating to climate change, gender diversity, sustainability reporting, pay equity and paid family leave.
While we assess our engagement priorities every year, they may not change annually; they are often of long-term nature.
4. Proxy voting
Our proxy voting is predominantly related to governance issues such as election of directors, board structures and management remuneration. When practicable, we seek to engage with the investee company before we vote against management’s recommendation on an AGM resolution. We also have a number of dialogues with companies during the year, to discuss and comment on proposed governance structures, by companies, well ahead of AGMs.
Engagements are conducted by the Impax investment team, together with other investors and clients and partners with or without a lead or coordination from responsible investment organisations. Collaborative engagements are conducted across a number of ESG issues and specific sectors and companies. Collaborative engagements can be prioritised where outreach may particularly benefit from a larger group of shareholder involvement or in cases where an issue is being escalated.