Mirova is a front-line player in the RI industry, that offers cutting-edge thematic and multi-thematic approaches to sustainability. ESG issues are therefore at the heart of its investment processes, but also key components of is voting and engagement policy.
Organization of voting rights
The organization of our voting activity is articulated around two distinct poles.
Voting principles are defined by Mirova’s Responsible Investment Research Team, which is composed of analysts who are experts in environmental, social and governance issues. Our voting policy is updated annually. It is validated by Mirova’s Executive Committee, and by the Compliance and Internal Control Department. It is presented to the Board of Directors each year.
Resolutions are analyzed by Mirova’s Responsible Investment Research team. Voting decisions are the responsibility of the voting committee, which is composed of Mirova’s Global Head of Research and CIO of Equities and Fixed Income and its two Co-Heads of Responsible Investment Research. Portfolio managers and extra-financial analysts may be invited to participate in the committee’s deliberations depending on the subject under discussion.
Mirova’s voting rights are exercised by Ostrum AM’s Middle Office Department, according to instructions provided by Mirova as part of a service provider agreement. A report on the exercise of Mirova’s voting rights is presented to the Board of Directors annually.
Current procedure for the exercise of voting rights
Mirova uses an external voting services provider in charge of:
-informing Mirova of upcoming general meetings related to securities in its voting universe,
-analysing resolutions according to the principles defined in the present voting policy (i.e., custom service). In some cases, Mirova's in-house Research team reviews resolutions (further details are provided in LEA.15)
-providing access to a voting platform for the exercise of voting rights,
-transmitting voting instructions to the issuer.
This service provider is in direct contact with custodian banks, from which it receives, on a daily basis, a list of every position held for each portfolio within our voting universe. The votes for each account are registered on the voting platform.
The scope of Mirova's voting activities
Except in certain cases, Mirova exercises voting rights for all the UCITS (Undertakings for Collective Investment in Transferable Securities) and AIF (Alternative Investment Funds) under its management and for which it holds voting rights, as well as for employee investment funds the supervisory boards of which have delegated voting rights to Mirova. Mirova will exercise its voting rights for all eligible assets, as identified at the end of the year preceding the vote and which are located in portfolios for which Mirova holds voting rights,, on the condition that the regulatory and technical constraints imposed by markets and depositories permit that the exercise of voting rights be in the best interests of unitholders. In 2019, Mirova's voting universe was made up of 432 companies.
Within this voting perimeter, 469 general meetings (GM) were held in 2019. Mirova has exercised its voting rights for 425 companies at 4623 general meetings, making its participation rate 98.5%.
Mirova did not exercise its voting rights at 7 general assemblies due to technical problems (fund migration into proxy systems and administrative systems, validity of power of attorney, etc.). Mirova is committed to transparency and discloses an annual report on votes cast available on its website, and all Mirova votes on resolutions presented at the general meetings of companies held in its voting funds (not including dedicated funds) are disclosed through an online platform, accessible through Mirova's website: https://vds.issgovernance.com/vds/#/OTAyNg==/
Exceptions to the policy
Mirova has defined guidelines for the application of these voting principles by markets (France, Italy, Japan, UK, etc.) in accordance to local regulation, recommendations and maturity on corporate governance topics, but also for small capitalisations (notably executives paid under 1M€) and for some industries (in accordance to the banking industry regulation for example). [SL1] Detailed voting criteria are described in our “Application Framework”, a large Excel spreadsheet that is continuously updated and provided to our proxy in order to ensure that our voting policy is implemented as expected. This application framework is not confidential and can be communicated. However, due to its complexity, technicality and limited understandability to the larger audience, Mirova chose not to publish it on its website.
It should also be noted that the principles defined in our voting policy may not apply, depending on companies' nationality, as shareholders' meetings may exhibit varying prerogatives depending on national legislation.