We distinguish between proactive and reactive company engagements (dialogues):
Meeting company representatives, preferably on-site at their business, is an important aspect of our company analysis. Following initial investment, we maintain regular dialogue with the holdings.
As long-term investors, we want to express our opinions and expectations and encourage our holdings towards an approach that is as long-term as our own, with regard to, for example, investments in more sustainable production.
A consistent theme in our proactive dialogues is that we encourage our holdings to be more structured in their sustainability work and to integrate sustainability into all aspects of their business. Company-specific topics and issues are also identified through our proprietary tool, CF THOR.
Accordingly, we prefer our holdings to sign the ten principles of the UN Global Compact and to measure, report and reduce their climate impact.
If we receive information that a holding is not meeting our sustainability standards, we rarely sell the holding immediately, preferring instead to initiate a constructive dialogue to ascertain that the company clearly understands the problem and wants to improve.
The process is as follows::
- The fund manager seeks further information and discusses the holding with our Responsible Investment Board.
- The fund manager contacts the company to discuss our concerns.
- The CEO of Carnegie Fonder makes more formal contact with the CEO or chairman of the holding.
- We contact other shareholders to initiate joint shareholder engagement.
- If the response is unsatisfactory and the company does not demonstrate a willingness to change, we may decide to divest the holding.
The time it takes complete these processes varies, depending upon the nature of the issue, the size of our holding and where the company is based geographically. Each case is unique and is evaluated individually.