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Schroders

PRI reporting framework 2019

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Governance and human resources

SG 07. RI roles and responsibilities

07.1. Indicate the internal and/or external roles used by your organisation, and indicate for each whether they have oversight and/or implementation responsibilities for responsible investment.

Roles

Select from the below internal roles

          Global Head of Product
        

07.2. For the roles for which you have RI oversight/accountability or implementation responsibilities, indicate how you execute these responsibilities.

Senior investors have specific KPIs relating to ESG integration, ensuring ESG implementation remains a key priority for our analysts and fund managers, as well as our Sustainable Investment team.

In 2017, Sustainability was identified as a Strategic Capability for the firm. As a result of this there is additional oversight of our activities by our Global Head of Product and Solutions, who is a Group Management Committee (GMC) member, on a monthly basis. There are specific objectives around the development of our activities in this area.

Throughout the year we have provided updates to the GMC on progress and the three-year plan for Sustainability. This group is Schroder's senior leadership team and membership includes the two executive board members.

Our research analysts are required to address material and relevant ESG risks within their fundamental research. The ESG specialists periodically review a sample of research notes to assess the quality of ESG analysis, highlight best practice and provide feedback on how ESG analysis can be enhanced. This in turn influences the annual appraisal process.

We also have a UK and International Corporate Governance Committee comprising members of the Sustainable Investment team and senior investors to discuss and oversee engagement, voting and stewardship issues.

07.3. Indicate the number of dedicated responsible investment staff your organisation has.

16 Number

07.4. Additional information. [Optional]

Our dedicated Sustainable Investment team comprises 16 members and we also work very closely with the Head of Sustainability at Schroders Real Estate and the RI specialist at Cazenove Capital.

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SG 07 CC. Climate-issues roles and responsibilities

07.5 CC. Indicate the roles in the organisation that have oversight, accountability and/or management responsibilities for climate-related issues.

Board members or trustees

Chief Executive Officer (CEO), Chief Investment Officer (CIO), Chief Risk Officer (CRO), Investment Committee

Other Chief-level staff or head of department

Portfolio managers

Investment analysts

Dedicated responsible investment staff

External managers or service providers

07.6 CC. For board level roles for which have climate-related issues oversight/accountability or implementation responsibilities, indicate how these responsibilities are executed.

As a plc and an asset manager, our board has oversight for climate related issues on a number of fronts.

  • Our own environmental footprint. The strategy is approved by the board, and implemented by our infrastructure division. Most recently our Chair approved a commitment to joining the RE 100, a commitment to using 100% renewable energy by 2025. Almost 70% of our electricity is currently from renewable sources.
  • The board plays a critical role in ensuring investment desks and other areas of the firm are supported to examine issues like climate change and to ensure mechanisms are in place to do so, which they execute through their commitment of resources to the sustainable investment team and regular review of the firm's capabilities
  • The board has approved Schroders' Strategic Capability strategy, and Sustainability's inclusion in this. The specific plan includes ensuring that more of our investment processes across asset classes are integrating ESG in the best possible way, and that we are developing innovative products to meet sustainability challenges. There is a three-year plan around this, the implementation of which is monitored by the GMC.
  • Our Chief Executive (who is a board member) has supported system wide interventions such as early support for the TCFD recommendations. We are committed to aligning the business to those goals, which we recognise will be an ongoing process of improvement. Our policy activity is focused of building the right ecosystem for sustainable investment to become mainstream.
  • Our Chief Executive has also joined the FCA initiative on climate risk.

07.7 CC. For the management-level roles that assess and manage climate-related issues, provide further information on the structure and process involved.

The day-to-day implementation is delegated by the board to the Group Management Committee (GMC) and implementation takes place in a number of ways:

  • Our group impact.  Ongoing monitoring is delegated to the  Corporate Responsibility Committee, chaired by a Group Management Committee (GMC) member. 
  • Our Global Head of Equities, also a GMC member, is focused on ensuring effective ESG integration and the development of innovative new products, especially in the area of long term investing.  The Sustainable Investment team is tasked with building tools that enable our investors to incorporate sustainability issues into all of their investment decisions.  Climate change is a major part of our activity in this area.  Our publications indicate the quality of what we have done in this area (see http://www.schroders.com/en/lu/professional-investor/featured/climate-change-dashboard/).  The quality and usefulness of these are evaluated as part of our annual review process.
  • The performance of Schroder ISF Global Climate Change Equity and Schroder ISF QEP ESG ex Fossil Fuels is subject to the same controls as all of our investment processes.  A number of individuals are also assessed on their ability to grow assets into those funds.
  • We have specific targets around Thought Leadership and client education, which includes the expectation that Climate Change is a major pillar of this.  Outputs are monitored for quality and usefulness and feed into incentives for the team.  

07.8 CC. Explain how the organisation engages external investment managers on the TCFD recommendations and its implementation.


SG 08. RI in performance management, reward and/or personal development (Private)


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