As it pertains to the objectives for responsible investing, our most recent review identified a number of initiatives that we intend to begin implementing over the short, mid and long term in order to further our implication and adoption of responsible investing standards.
Principles 1 - We will incorporate ESG issues into investment analysis and decision-making
In 2019, we want to get the portfolio managers to consider the impact of certain ESG factors on the fundamental value of companies. In this context we will perform some initiatives that are as follows:
- Completing the integration of our additional data provider for ESG data/rankings: In 2018, we conducted dozens of meetings and trials with ESG data vendors. By Q2 2019, we expect to have built a database of raw ESG data that is easily consumed by all our investments teams.
- Training: We will continue to conduct education/training sessions to the investment team members as well as newly onboarded investment teams. In 2018 we will further complete the integration and have ESG scores and data directly fed into the platforms our portfolio managers use (Factset and Bloomberg)
- We will continue to spend more time with fixed income managers to explore ways to further integrate responsible investment in their research process.
- Further ESG integration by managers: Depending on the teams focus, formalizing and documenting the ESG integration process in the investment decision making.
Principle 2 - We will be active owners and incorporate ESG issues into our ownership policies and practices
- Proactive monitoring of ESG risks in the portfolio: In 2019, we will continue to implement portfolio monitoring tools. Portfolio managers will be provided with a complete ESG report for their flagship portfolios on a quarterly basis and encouraged to take action to improve their ESG scores.
- Add engagement examples to quarterly performance reviews: In Q2 2019, we will ask our investment teams to record any engagement activities in a centralised platform on a quarterly basis.
Principle 3 - We will seek appropriate disclosure on ESG issues by entities in which we invest
- We are members of the Canadian Coalition for Good Governance (CCGG). The CCGG is the pre-eminent corporate governance organization in Canada and is uniquely positioned to bring change as the voice of Canadian institutional shareholders. Representing the interest of institutional investors, CCGG promotes good governance practices in Canadian public companies and the improvement of the regulatory environment to best align the interests of board and management with those of their shareholders, and to promote the efficiency and effectiveness of the Canadian capital markets. This relationship is beneficial to us as it allows us to identify priorities related to ESG issues and work alongside other key industry players to promote both active ownership and identify potential improvement on governance and level of disclosure of ESG issues.
- In 2019, we implemented a Global Proxy Voting Policy formalize our disclosure requirements on ESG issues, and portfolio managers vote in favor of proxies addressing those issues. Considerations on those votes should include the impact of any proposal on the company's value and operating capacity, as well as the need to avoid unduly restricting the flexibility of the board of directors or burdening the board with the obligations that are foreign to the company's mission. Considerations is also given to the reasonableness of the costs/benefits of proposals.
Principle 4 - We will promote acceptance and implementation of the Principles within the investment industry
- Two members of the CIO office and designated members of Fiera's distribution team will continue to attend events and promote the principles to peers in the investment industry
- Two members from the CIO office, along with a representative from institutional distribution, currently attend the Réseau PRI Québec meetings in Montreal
- One member from institutional distribution currently attends the RIA meeting in Toronto (Responsible Investment Association)
Principle 5 - We will work together to enhance our effectiveness in implementing the Principles
- Fiera Capital is involved with a local group of PRI signatories striving to promote acceptance of the Principles within the investment industry, and encouraging initiatives to further integrate ESG issues into the investment management process.
Principles 6 - We will each report on our activities and progress towards implementing the Principles
- On an annual basis, we provide a summary of our ESG and PRI related progress to all interested clients, some of which are themselves PRI signatories. This takes the form of a letter describing our initiatives and progress during the year as well as expected activities for the year to come. This letter is available to clients/beneficiaries interested in knowing our objectives for responsible investing.