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British Columbia Investment Management Corporation

PRI reporting framework 2019

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You are in Indirect – Manager Selection, Appointment and Monitoring » Appointment

Appointment

SAM 04. Appointment processes (listed equity/fixed income)

04.1. Indicate if in the majority of cases and where the structure of the product allows, your organisation does any of the following as part of the manager appointment and/or commitment process

04.2. Provide an example per asset class of your benchmarks, objectives, incentives/controls and reporting requirements that would typically be included in your managers’ appointment.

Asset class

Benchmark

ESG Objectives

          Our external equity managers are not permitted to invest in companies involved in the production of cluster bombs or landmines. BCI specifies which companies are to be excluded.
        
          All of our external equity partners understand our expectation that  material ESG factors are to be considered in the investment process.  For the reporting period, BCI only entered into one new contract with an equity manager.  In this case, a commitment to integrate all material ESG issues in accordance with BCI's principles was included in the agreement between our two organizations.
        
          We request that all of our equity managers provide quarterly reporting on their engagement activities.
        
          BCI retains the right to vote all of its shares, except for one long short mandate where we are in a pooled fund.  In this case, we worked with the manager to ensure that we were comfortable with the vote decisions the manager was likely to make.  Our discussions resulted in the manager making changes to their voting guidelines to ensure alignment.
        
          Our external managers are aware of BCI's responsible investment principles and approach and are expected to act accordingly. These principles are guidelines and do not constitute a prescribed approach to responsible investment or ESG integration.
        

Incentives and controls

Reporting requirements

Benchmark

          Standard benchmark
        

ESG Objectives

          Our external fixed income managers are not permitted to purchase bonds in companies involved in the production of cluster bombs or landmines.  BCI specifies which companies are to be excluded, public or private.
        
          All of our external fixed income and private credit partners understand our expectation that material ESG factors are to be considered in the investment process.
        
          During the reporting year, BCI appointed external managers for a new private debt portfolio and assessed potential managers on a number of criteria including the strength of their RI policy. These assessments and subsequent conversations resulted in BCI's requests that one of the managers formalize an RI policy before the mandate was finalized.
        
          Our external managers are aware of BCI's responsible investment principles and approach and are expected to act accordingly. These principles are guidelines and do not constitute a prescribed approach to responsible investment or ESG integration.
        

Incentives and controls

Reporting requirements

Benchmark

          Public market equivalent benchmarks
        

ESG Objectives

          Our external managers are not permitted to purchase investments in companies involved in the production of cluster bombs or landmines.  BCI specifies which companies are to be excluded, public or private.
        
          BCI is a signatory of the voluntary framework of the United Nations-backed Principles of Responsible Investment and of the United Nations Environment Programme Declaration on Climate Change. BCI is also a member of the Asian Corporate Governance Association, International Corporate Governance Network, the Long Term Infrastructure Investors Association, and the 30% Club, and has endorsed the Institutional Limited Partners Association (“ILPA”) Private Equity Principles.
        

Incentives and controls

Reporting requirements

Benchmark

          Internal KPI Performance review of impact makes up 10% of overall KPI score.
        

ESG Objectives

          QuadReal Sustainability Policy includes addendum outlining 2018 - 2020 annual ESG reporting expectations.
        
          6 ESG webinars held during the year and partner attendance was recorded.
        
          QuadReal Sustainability Policy and reporting expectations shared with all partners.
        
          Partners must submit ESG data following internal QuadReal reporting guidelines.
        

Incentives and controls

Reporting requirements

Benchmark

          7% nominal program benchmark
        

ESG Objectives

          BCI's infrastructure group has a responsible investment policy which is shared with our external managers.
        
          Our external managers are not permitted to purchase companies involved in the production of cluster bombs or landmines.
        
          BCI's infrastructure group has a responsible investment policy which is shared with our external managers.
        
          BCI's infrastructure group has a responsible investment policy which is shared with our external managers.
        
          BCI is a signatory of the voluntary framework of the United Nations-backed Principles of Responsible Investment and of the United Nations Environment Programme Declaration on Climate Change. BCI is also a member of the Asian Corporate Governance Association, International Corporate Governance Network, the Long Term Infrastructure Investors Association, and the 30% Club, and has endorsed the Institutional Limited Partners Association (“ILPA”) Private Equity Principles.
        

Incentives and controls

Reporting requirements

04.3. Indicate which of these actions your organisation might take if any of the requirements are not met

04.4. Provide additional information relevant to your organisation's appointment processes of external managers. [OPTIONAL]

          Our external equity managers are required to provide ESG reporting on a quarterly basis, in addition, they are required to indicate compliance with our exclusion of cluster munitions and anti-personnel landmines. If our managers do not meet these requirements or any of our other requirements or expectations, there is a range of options that we may consider, such as those mentioned in 04.3.
        

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