NILGOSC acknowledges that good environmental, social and corporate governance (ESG) practices can have a favourable impact both on financial performance and society in general. Accordingly, NILGOSC requires its active investment managers to monitor best practice in this area and ensure that ESG considerations, where relevant, are taken into account in the investment management process. All active fund managers are instructed to engage, on NILGOSC's behalf, with those companies where ESG policies fall short of acceptable standards and where this is likely to have a detrimental effect on the long-term value of the company.
In 2010 NILGOSC also commenced direct engagement with the UK companies in which it holds shares. NILGOSC writes to all UK listed companies when it has voted against resolutions at the Annual General Meeting (AGM) to outline the rationale for the decision. NILGOSC aims to write to these companies in advance of the meetings to make the engagement as effective as possible. In January 2015, NILGOSC began issuing engagement letters to other European listed companies, as well.
NILGOSC aims to promote effective stewardship and engagement with companies by participating in collaborative engagements and initiatives, with UNPRI signatories through the UNPRI collaboration platform or with other investor groups