We integrate the analysis of governance issues into our security selection and portfolio construction. Internal credit analysts develop independent notional ratings and evaluate governance issues for the corporate bond issuers in our investing universe. Examples of typical governance issues include:
1) Board independence and oversight of CEO;
2) Level and nature of executive compensation (alignment of incentives); and
3) Independence of audits and quality of internal controls.
AIMCo also considers the advice of rating agencies on governance issues (e.g. S&P). Environmental and Social issues are evaluated on a case by case basis if relevant to an individual issuer (e.g. potential environmental remediation or labour issues and their related impact).