ESG Oversight Group (previously named as ESG Strategy Group): comprises of 10 senior leaders, including the Global Head of ESG, Chairman of the Investment Group, senior Portfolio Managers and Analysts, Legal, Quantitative Research, Government Relations, Product Development and Distribution teams. This group, which reports directly to the Capital Group Management Committee and meets on a monthly basis, sets strategic direction and oversight for Capital Group's ESG agenda and key ESG priorities. Three members of the ESG Oversight Group are also the board members of Capital and two are members of the Capital Group Management Committee.
Investment Group: Capital Group’s approach is to incorporate ESG risks and opportunities into investment decisions. Our team of more than 200 in-house equity and fixed income analysts and 100 portfolio managers are responsible for evaluating all relevant financial and non-financial factors – including ESG issues – as part of their fundamental research in order to generate long-term value, weighing risks in the context of the sector and geographical focus of their investments.
To develop a holistic long-term perspective, our analysts and portfolio managers make 12,000+ company visits each year. These regular meetings with management allow engagement and discussion on issues relevant to the long-term value of a company. ESG issues are an important and natural part of this ongoing dialogue; management's understanding of environmental, social and governance issues is a vital aspect of our analytical process. A firm's efforts to both minimize risks and also seize new business opportunities related to society's changing expectations help shape our investment decisions. We believe management's ESG policies can affect a firm's reputation and license to operate, its ability to attract and retain talent, its prospects for working effectively with stakeholders and regulators, and its long-term growth outlook.
We also take a thoughtful approach to proxy voting in this context. When evaluating proposals relating to ESG issues, we assess the specific circumstances at each firm, the company’s current policies, and the long-term impact.
Our research analysts provide the voting recommendations to the proxy committees. Their experience and in-depth knowledge of each company and their sectors enables them to factor in particular relevant circumstances and any idiosyncratic characteristics into the voting recommendations. This ensures that our voting decisions are in line with our overall long-term investment thesis and forms part of our ongoing engagement and interaction with the company. The intimate involvement of the investment group in the voting process enables them to explain and discuss our voting position with company management and the non-executive board, this access broadens our understanding of the business ensures our voting decisions are integrated closely with our wider company engagement.
The proxy voting committee is comprised primarily of investment professionals and Legal, bringing a wide range of experience and views to bear on each voting decision. Our proxy voting committees, delineated by geographical region, are responsible for overseeing proxy voting, globally.
RI staff: Our investment group is assisted and supported by:
- ESG team: is responsible for driving the implementation of ESG initiatives across Capital. The global ESG Team works with our investment professionals and supports the integration of ESG factors into our investment process. ESG Team members have expertise in research, sustainable investing and issuer engagement.
- Governance and Proxy team: assists our investment professionals in executing our stewardship activities. Its main duties include: voting at company meetings in every market on behalf of our clients, monitoring and assisting our investment professionals with engagement work on governance or proxy voting-related issues and developing – in conjunction with the proxy committees – our voting guidelines.