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Ninety One

PRI reporting framework 2020

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Outputs and outcomes

LEA 09. Number of companies engaged with, intensity of engagement and effort

Indicate the proportion of companies in your listed equities portfolio with which your organisation engaged during the reporting year.
We did not complete any engagements in the reporting year.

Number of companies engaged

(avoid double counting, see explanatory notes)

Proportion of companies engaged with, out of total listed equities portfolio

Individual / Internal staff engagements

240
19

Collaborative engagements

8
1

09.2. Indicate the breakdown of engagements conducted within the reporting year by the number of interactions (including interactions made on your behalf).

No. of interactions with a company
% of engagements
One interaction
2 to 3 interactions
More than 3 interactions
Total
100%

09.3. Indicate the percentage of your collaborative engagements in which you were the leading organisation during the reporting year.

Type of engagement

% leading role
  Collaborative engagements

09.5. Additional information. [Optional]


LEA 10. Engagement methods

10.1. Indicate which of the following your engagement involved.

10.2. Additional information. [Optional]

Ninety One will endeavour to communicate with companies in a constructive and clear manner that enhances mutual understanding. Communication should be founded on a mutual understanding of motive and should seek to objectively establish a rationale for change to occur. It is therefore important that our communication clearly sets out our views and we dialogue in a manner that builds trust.

In communicating ownership concerns, Ninety One will address issues to the chairperson of the company. In instances where the chairperson is not independent, Ninety One will seek to engage directly with the lead independent director. When appropriate, matters will be addressed through the company secretary to ensure that the board is collectively informed about material issues that are being raised. Our communication will always focus on the business case for the change.


LEA 11. Examples of ESG engagements

11.1. Provide examples of the engagements that your organisation or your service provider carried out during the reporting year.

ESG Topic
Company leadership issues
Conducted by
Objectives

To see a refreshed board with a new Chairperson that could oversee the successful restructuring of the business

Scope and Process

We engaged with the company in March 2019 to communicate our expectation for the board to make sure that executives and bankers act in the long-term interest of the company and that we were kept informed through this process.

We engaged again in June 2019 to discuss proposed changes to the remuneration policy. We were supportive of the changes but requested further details around the use of targets and measures.

We further engaged in September 2019 to prevent further destruction of value and to encourage future share price recuperation.

Our engagement included discussion with executive management, directors, Chairman, assessment if change could be achieved without an Extraordinary General Meeting (EGM), letter to the Chairman setting out our board skill and diversity requirements and our preference regarding the Chairman role. The new Board is now in place with a Chairman that has extensive banking experience.

Outcomes
ESG Topic
Executive Remuneration|Climate Change|Company leadership issues|Sustainability reporting
Conducted by
Objectives

To see a change to executive management and an appropriate adjustment to variable remuneration.

To encourage climate reporting in line with the TCFD recommendations. 

Scope and Process

Over 2019 we engaged with this company on a variety of governance related matters, including remuneration, TCFD disclosure and the joint executive structure. In addition, we wrote to the Chairman requesting executive management change and appropriate adjustment to variable remuneration. On 28 October the company reported on the findings of the Board Review and the action taken. The joint CEOs were awarded zero as the value of their short-term incentive and agreed to a mutual separation from 31 October. In addition, a Climate Change Report has been published in alignment with the TCFD requirements.

In November 2019, we further engaged to ensure their Climate Change Reporting aligned with the Paris Agreement, including the TCFD framework reporting requirements. Further engagement is required to ensure these objectives are fully realised.

Outcomes
ESG Topic
Climate Change
Conducted by
Objectives

To ensure that the board was committed to aligning company climate strategy with the Paris Agreement

Scope and Process

We took part in a collaborative engagement alongside Climate Action 100+ with the aim for the company to commit to align its business with the Paris Agreement. The engagement included work to ensure:

  • The board was committed to aligning the company strategy with the Paris agreement.
  • Clear board climate responsibility.
  • Aligning executive incentives.
  • The company was making use of the TCFD to disclose its commitment to the Paris agreement and its strategy was aligned with this commitment, specifically with respect to its coal assets

A statement was released by the company pledging to curb its coal production and to align its business and investments with the goals of the Paris Agreement.

Outcomes
ESG Topic
Health and Safety
Conducted by
Objectives

To improve the health and safety record of the company

Scope and Process

We had various correspondence with the company, including sending a letter outlining our concerns and numerous meetings with Chair, CEO and Chair of the Remuneration Committee.

Our meetings with the company have indicated concrete commitment to strategically addressing safety and linking improved outcomes to the variable incentive schemes.

Outcomes
ESG Topic
Sustainability reporting
Conducted by
Objectives

To encourage reporting to the CDP and annual reporting in line with a global reporting standard.

Scope and Process

We had numerous interactions with the company over 2019 including sending a letter to communicate the commitments we would like to see, a follow-up phone call and a face-to-face meeting with the Head of Investor Relations.

The company have committed to report into the CDP in 2020 and to align their 2020 sustainability report with the Global Reporting Initiative (GRI). We will continue to monitor these commitments to ensure they are followed through in the 2020 reporting cycle. 

Outcomes
ESG Topic
Other governance
Conducted by
Objectives

To encourage a listing on the main market, to improve the independent oversight of executives and to appoint a new independent Chairman

Scope and Process

Our engagement included meetings with the current Chairman and a letter to reinforce our engagement goal.

The company has agreed to list on the main market in the US. Two new independent directors will be appointed. One NED to step down as well as the Chairman in 2020.

Outcomes

11.2. Additional information. [Optional]


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