This report shows public data only. Is this your organisation? If so, login here to view your full report.

BT Financial Group

PRI reporting framework 2020

You are in Direct - Listed Equity Active Ownership » Engagement

Engagement

LEA 02. Reasoning for interaction on ESG issues

Indicate the method of engagement, giving reasons for the interaction.

Type of engagement

Reason for interaction

Individual / Internal staff engagements
Collaborative engagements
Service provider engagements

02.2. Indicate whether your organisation plays a role in the engagement process that your service provider conducts.

02.3. Indicate the role(s) you play in engagements that your service provider conducts on your behalf.

02.4. Additional information. [Optional]

BT has three approaches to engagement:

1. Engagement service providers being Regnan (Australia) and EOS at Federated Hermes (Global).

2. Engagement undertaken by underlying investment managers.

3. Collaborative engagement efforts, such as the Climate Action 100+.

At times, we may individually engage with companies. This scenario did not arise in the reporting period (2019).

Regnan's engagement program involves a client approval process which provides the opportunity to discuss and provide feedback on each of the items above. Engagement plans are developed with client input on the companies selected, relative priorities within the program and change objectives. In addition to monthly reporting, quarterly meetings are offered to discuss recent and upcoming engagements, including frequency/intensity and next steps for engagement.

EOS at Federated Hermes offers quarterly service review meetings and opportunities to feed into the engagement selection process as well as ad-hoc engagement progress discussions and direct participation in engagements where appropriate at client request.


LEA 03. Process for identifying and prioritising engagement activities

New selection options have been added to this indicator. Please review your prefilled responses carefully.

03.1. Indicate whether your organisation has a formal process for identifying and prioritising engagements.

Indicate the criteria used to identify and prioritise engagements for each type of engagement.
Type of engagement
Criteria used to identify/prioritise engagements
Individual / Internal staff engagements

Individual / Internal staff engagements

Collaborative engagements

Collaborative engagements

Service-provider engagements

Service-provider engagements

specify

          Our service provider EOS at Federated Hermes further considers the additionality of its engagement, the feasibility of engagement and its potential impact (voting rights).
        

03.3. Additional information. [Optional]

Regnan prioritises engagement via a formal process that involves internal prioritisation, and approval of this by clients. Its prioritisation process is based on three primary factors:
1. The value at risk for the company from E S and G issues (and conversely the upside potential from change) based on in-house research focused on the gap between a company's ESG exposure and its response to it.
2. The extent to which clients are exposed to the company, using a combination of client data where available and market capitalisation used as a proxy for portfolio weight.
3. The additionality of impact when engaging on an issue that already receives widespread attention (i.e. consideration as to whether engagement is likely to be additive).

Where sensitivities arise, for instance due to contentious proxy voting matters or divestment pressures, elements of the existing plan may be elevated in relative priority, or additional companies may be added, however is does not typically considered in the initial plan development unless the other criteria are present. In these instances, additional information may also be provided to assist clients in preparing for meeting, and/or responses to, interested parties.


LEA 04. Objectives for engagement activities

New selection options have been added to this indicator. Please review your prefilled responses carefully.
Indicate whether you define specific objectives for your organisation’s engagement activities.
Individual / Internal staff engagements
Collaborative engagements
Service-provider engagements

04.2. Additional information. [Optional]

Objectives are set for all Regnan engagements – both at a high level (within the engagement plan) and at an engagement level, with objectives tailored for specific meetings/letters. 

Our service provider EOS at Federated Hermes conducts engagements using specific milestone-driven objectives for most companies in its engagement programme.


LEA 05. Process for identifying and prioritising collaborative engagement

Indicate whether you monitor and/or review engagement outcomes.
Individual / Internal staff engagements
Collaborative engagements
Service-provider engagements
Indicate whether you do any of the following to monitor and/or review the progress of engagement activities.
Collaborative engagements
Service-provider engagements

05.3. Additional information. [Optional]

For Regnan's engagement activities, next steps are planned at the end of each engagement based on an assessment of progress against change objectives. Disclosures are also formally reviewed twice a year for public (verifiable) evidence of progress against objectives. Revisions are made throughout the program, consistent with current progress (or lack thereof). The overall program is formally reviewed and mandates re-issued for client review/approval approximately every two years. Internal checks are in place to ensure data accuracy and supporting documents are provided to clients upon request to support external validation requirements.


LEA 06. Role in engagement process

06.1. Indicate whether your organisation has an escalation strategy when engagements are unsuccessful.

06.2. Indicate the escalation strategies used at your organisation following unsuccessful engagements.

06.3. Additional information. [Optional]

Where engagement fails to result in the necessary changes, options for escalation as detailed in Regnan's engagement guide explicitly include:                                                                                                                                            
- Discussing the concerns with non-client investors, Regnan peers, substantial fund managers and relevant other stakeholders
- Providing guidance to clients on voting matters relevant to engagement priorities
- Recommending that clients ensure that the unaddressed risks are adequately priced into investment decisions
- Proposing a resolution at the company's AGM or EGM
- Suggesting clients consider excising the stock from their portfolios

Furthmore, our service provide EOS at Federated Hermes continually reviews the progress of its engagements and considers whether to intensify efforts and escalate the engagement or discontinue the objectives as the situation demands. Our service provider keeps us informed of the progrress through quarterly reporting as well as a client portal.


LEA 07. Share insights from engagements with internal/external managers

07.1. Indicate whether insights gained from your organisation`s engagements are shared with investment decision-makers.

Type of engagement

Insights shared

Individual / Internal staff engagements

Collaborative engagements

Service-provider engagements

07.2. Indicate the practices used to ensure that information and insights gained through engagements are shared with investment decision-makers.

          Discussing areas of our service-providers' engagement programme or company-specific insights with our internal investment team and external investment managers.
        

07.3. Indicate whether insights gained from your organisation’s engagements are shared with your clients/beneficiaries.

Type of engagement

Insights shared

Individual/Internal staff engagements

Collaborative engagements

Service-provider engagements

07.4. Additional information. [Optional]

We actively monitor and review the activities of our service providers Regnan and EOS at Federated Hermes through quarterly calls and regular reports. EOS at Federated Hermes provides a client facing portal which allows us to refer to the full history of engagement with each company and track progress.

We provide customers with quarterly and annual service provider engagement reporting through our websites: www.bt.com.au/sustainability and www.advance.com.au


LEA 08. Tracking number of engagements

08.1. Indicate whether you track the number of your engagement activities.

Type of engagement
Tracking engagements
Individual/Internal staff engagements​

Collaborative engagements

Service-provider engagements

08.2. Additional information. [Optional]

Regnan and EOS' regular reporting provides full disclosure on the number of engagements conducted on our behalf.

Regnan provides monthly and annual reports on the volume of activity and progress observed.

We also monitor the engagements undertaken by our investment managers through an annual questionnaire, noting that tracking the aggregate number of manager engagements is more difficult due to possible overlap in companies engaged.


Top