In 2019, Boston Trust Walden engaged 178 companies in client portfolios across all investment strategies, excluding the Walden International Equity mutual fund (see below for more details). This represents approximately 60 percent of portfolio companies. Note that this metric obscures our frequent practice of engaging with a single company on multiple ESG issues at multiple times throughout the year.
Oftentimes there is not a clear boundary between collaborative engagements and individual/internal engagements. Under the collaborative category, we counted formal collaborations with established investor networks (e.g., CDP, Climate Action 100+, ICCR, WDI) or large institutional investors that address a specific ESG issue at a relatively large number of companies (e.g., lobbying transparency engagement co-led with AFSCME).
For the collaborative engagement count in LEA 09.1 above (n=40), we included only portfolio companies that were not otherwise included under the individual category (n=138) to avoid double-counting. In reality, we engaged numerous companies under both individual and collaborative engagements. In these circumstances, if the collaborative engagement was more substantial or effective, we counted it under that category. We do not include companies that were part of collaborative engagements, if they are not owned in managed portfolios. If we had, collaborative engagements would number in the hundreds (e.g. participation in the Climate Action 100+ Initiative that seeks to engage 100+ of the world's largest corporate greenhouse gas emitters, most of which are not held in our clients' portfolios). We also note that because of the broad reach of many of these collaborations, Boston Trust Walden's follow-up is limited. Nevertheless, we believe these initiatives help build company awareness of the importance of ESG factors to a broad range of investors and expand our influence and impact well beyond our investment portfolios.
Of the 40 engagements counted as collaborative engagements, we determined that we had a leadership role in 10 engagements, or 25%.
Our efforts leading such coalitions greatly broaden our reach beyond those companies in client portfolios. For example, in 2019, Boston Trust Walden participated in numerous formal collaborations, some of which we co-led, including:
- Co-chairing the Thirty Percent Coalition's Institutional Investor Committee, which wrote greater than 100 companies in 2019;
- Leading a subset of engagements on behalf of the Sustainable Accounting Standards Board's (SASB) Investor Advisory Group encouraging companies to support and report on SASB standards;
- A global investor letter asking 47 of the largest U.S. publicly traded companies to align their climate lobbying with the goals of the Paris Agreement. The letter was sent as part of the Climate Action 100+ engagement agenda from 200 institutional investors representing $6.5 trillion in assets under management; and
- Co-leading with AFSCME an engagement initiative advocating for lobbying transparency.
Overall, we believe our engagement can accurately be described as comprehensive, covering a broad range of environmental, social and corporate governance issues. In addition, in 2019 our engagement work touched on topics related to 12 out of the 17 Sustainable Development Goals (SDGs).
The figures above do not include active ownership involving companies in the Walden International Equity Fund. These holdings are currently not a focus of engagement based upon limited overall assets in this strategy (less than 1% of public equities). However, Boston Trust Walden engaged numerous companies in this strategy, nearly all of which would be classified as "collaborative engagements" where we did not take a leading role.