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Regnan Governance Research and Engagement Pty Ltd

Service Provider Reporting Framework 2017

You are in Strategy and Governance » Responsible investment policy

Responsible investment policy

SG 01. Responsible investment policy

01.1. Describe how your organisation’s philosophy incorporates environmental, social and governance factors, and the link to your business offerings.

          Regnan was established by and for institutional investors to investigate and address environmental, social and corporate governance (ESG) related sources of risk and value for long term shareholders.  

Focusing solely on ESG for more than 15 years has ensured the depth of expertise and breadth of experience necessary to support our Australian and international clients to develop, operationalise and implement effective responsible investment strategies.  

Regnan provides an ESG research and ratings service, an engagement and advocacy program to pursue improved corporate ESG performance, and an advisory service to assist organisations embed ESG into core policies, processes and positioning. 

Responsible investment/ESG constitute the entire Regnan suite of business offerings. Core offerings seek to improve risk/return via ESG. Additional offerings exist for clients with additional objectives (e.g. ethical screening, normative scoring). 

Responses here (e.g. about the organisation’s philosophy) refer to the core offerings.

01.2. Indicate whether you have policies that formalise the incorporation of your beliefs in your business offerings.

01.3. Indicate the components/types  of your policy

Policy components/types

01.4. Indicate how these are put into practice internally across the organisation.

          Recruit for specific experience in ESG

01.5. Additional information [OPTIONAL]

Regnan's business solely focuses on RI / ESG.  Therefore all staff roles, business activities and product and service offerings represent the encoding of our ESG philosophy, policies, and guidelines developed by the team.

ESG is a core competency across the organisation, a pre-requisite in all recruitment, professional development and performance processes. Therefore we consider that all remuneration is linked to achieving ESG objectives.


SG 02. Publically available policies

02.1. Indicate which of your policy documents or statements (if any) are publicly available. Provide the URL and an attachment of the document.

Policy or document name

Attachment (optional)

02.2. Additional information. [OPTIONAL]

Our core ESG policy is summarised in our publicly available website and annual reports on progress. Available via:

Formalised guidelines on environmental, social and governance factors constitute the main intellectual property of the organisation, and are therefore not publicly disclosed, except where these form part of our stewardship program.

SG 03. Norms used to develop policies

03.1. Indicate what standards you have used to develop your organisation’s policies. Tick all that apply.

          ASX Corporate Governance Principles and Recommendations
          International Corporate Governance Network standards
          Sustainability Accounting Standards Board (SASB) standards

SG 04. Policy offerings to clients

04.1. Indicate whether you offer any of the following policies to clients.

Off the shelf
Asset class-specific RI guidelines
Sector-specific RI guidelines
Screening/exclusions policy
Engagement policy
(Proxy) voting policy
RI guidelines set out within the Investment Policy Statement (IPS)
RI guidelines set out in a freestanding RI policy
Multi-year RI implementation project plan
Conflict of interest management policy
Stockbroker allocation policy
Securities lending policy
Other, please specify (1)

please specify (1)

          We provide support to clients in developing policies tailored to their needs and circumstances. E.g. ethical screen, impact product policy etc.
Other, please specify (2)
Other, please specify (3)
None of the above

04.2. Provide a brief description of the key elements, any variations, or exceptions applying to these policies.

Regnan tailors all policies offered to individual client needs.

SG 05. ESG/RI in business offerings

05.1. Describe how you include ESG/RI factors as an integral part of your business offerings.

Business area

Stewardship Services

How you include ESG/RI factors

Regnan’s stewardship service is solely focused on ESG factors. This service for asset owners / asset managers is a core offering, developed from a proprietary research program, prioritised in consultation with clients, to address ESG related matters that we have identified as material to long term value.

Engagement is conducted to address company specific concerns as well as ESG issues that affect multiple stocks, sectors or the portfolio more broadly.

Advisory and Consultancy

How you include ESG/RI factors

Regnan's advisory service is solely focused on RI / ESG.  This service meets clients’ needs for assistance with developing responsible investment / ESG priorities and portfolio resilience via their own business strategies, policies, processes and positioning.

Examples include the development of responsible investment strategy / policy, stewardship programs, active ownership activities, manager ESG review, and integration of ESG into product strategy. 

Research and Data Provision

How you include ESG/RI factors

Regnan's research and ratings are entirely focused on ESG factors.

Regnan uses an in house proprietary methodology to assess S&P/ASX200 listed companies across a range of specific environmental, social and corporate governance factors.

We use a 'bottom up' approach to stock assessment, akin to fundamental research, that focuses on financial value. ESG issues assessed are those considered relevant to how the company maintains and creates value. 

SG 06. Outsourcing of services

06.1. Indicate whether you outsource some of your services.

Business area

SG 06.2. Outsourcing of services (Not Applicable)

SG 07. Providing training/education

07.1. Indicate whether you provide training/educational services on ESG/RI. Tick all that apply.

07.2. Describe the main components of your training/educational services on ESG/RI and any variations depending on the group you provide training/education to.

Regnan offers training to trustee boards. This includes expert commentary on emerging ESG trends and the fiduciary landscape, as well as, on occasion, in depth explorations of a single issue.

As part of its role in shaping the public debate, Regnan also participates as a speaker in numerous activities with a training / knowledge building focus, including in collaboration with other organisations.

07.2. Describe the main components of your training/educational services on ESG/RI and any variations depending on the group you provide training/education to.

Regnan offers tailored training to investment manager clients who wish to embed ESG into investment decision-making. Activities can range from presentations and workshops to one-on-one training with individuals.

This service for asset managers is by request of either the asset manager or by asset owner clients wishing to extend their managers' ESG capabilities.

SG 08. Level of involvement in collaborative organizations and/or initiatives

08.1. Select the collaborative organisation and/or initiatives of which your organisation is a member, or in which it participated during the reporting year and the role you played.

Collaborative Organisation/Initiative

Provide a brief commentary on the level of your organisation’s involvement in the initiative [OPTIONAL]

          Regnan is a founding signatory of the PRI and has been deeply involved with the initiative on a regular basis. In addition to supporting current and intending signatories to meet their PRI commitments, Regnan has contributed to collaborative efforts in a range of areas during the reporting period, including the current carbon lobbying collaboration. Regnan has shared case studies from our own engagement activities, supported the development of PRI materials, and provided speakers at PRI events. In the reporting period, Regnan contributed to the development of the terms of reference for PRI’s consultation on developing a sustainable financial system and the PRI and EDF’s publication “An Investor’s Guide to Methane” with insights from our own direct engagement on unconventional oil and gas in Australia.
          Investor Group on Climate Change (Australia)

Provide a brief commentary on the level of your organisation’s involvement in the initiative [OPTIONAL]

          Regnan staff actively participate in a number of regular working groups led by the IGCC. Further, Regnan input is sought on IGCC publications and public policy submissions.
          Responsible Investment Association Australasia

Provide a brief commentary on the level of your organisation’s involvement in the initiative [OPTIONAL]

          Regnan provides in kind support to RIAA by providing office facilities, and Regnan’s acting managing director is currently the deputy chair of the RIAA board. Regnan actively participates in RIAA run working groups on responsible investment. RIAA and Regnan have co-hosted industry events to promote long-termism, and Regnan regularly provides speakers for RIAA conferences.
          International Corporate Governance Network

Provide a brief commentary on the level of your organisation’s involvement in the initiative [OPTIONAL]

          We are the country correspondent for Australia for ICGN. We feed in to member consultations and are participating in the annual conference working group for 2017 and have provided a speaker to each of the recent annual conferences.

08.2. Additional information. [OPTIONAL]

SG 09. Applying, advancing and promoting the PRI principles

09.1. Describe how your organisation applies, advances and promotes the PRI Principles.

Regnan's suite of offerings is entirely directed towards advancing responsible investment; our philosophy is closely aligned to the PRI principles, which are applied across all business activities.

More specifically, Regnan's engagement and research offerings support clients in adhering to the six principles. Regnan also assists clients in meeting their specific obligations under the PRI, including reporting.

When developing tailored advice to advisory clients that are seeking to embed ESG across their business activities, we may recommend that the client becomes a signatory to the PRI and assist them in meeting their commitments.

Regnan also actively seeks collaborative engagement opportunities with likeminded organisations which advance the principles. Where aligned with client-approved mandates for engagement and advocacy, Regnan will participate in collaborative engagement initiatives coordinated by the PRI.

09.2. Highlight whether there are any ways that your organisation would like to engage further with the PRI. [OPTIONAL]

SG 10. Actions taken to promote responsible investment

10.1. Indicate which of the following actions your organisation has taken to promote responsible investments, independently of collaborative initiatives.

          Facilitated Chatham House discussions between investors and corporate directors to encourage greater focus on long-termism. Developed and promulgated frameworks for different approaches to responsible investment.

10.2. Additional information. [OPTIONAL]

SG 11. Long term trends

11.1. Indicate which of the following long-term trends are addressed in your product outputs.

11.2. Explain how this long term trend affects your product outputs.

Changing demographics are factored into Regnan engagement and research offerings. For example, diversity and human capital management considerations such as aging workforces or changing customer or stakeholder demographics are analysed by Regnan when assessing a stock’s ESG characteristics. Companies in which concerns are held regarding management of these issues may be recommended for engagement. Detailed behavioural change objectives will be developed to be pursued in engagements with the company. 

Further, changing demographics influence recommendations to advisory clients. For example, considerations regarding the rise of millennial influence and the increased wealth of women have shaped advisory recommendations to clients about the value of RI product offerings.

In addition, shifts in the demographics of participants in public company scrutiny (with developing country observers and activists increasingly connected and visible to developed country audiences) has introduced additional nuance to preferred outcomes from engagement.

11.2. Explain how this long term trend affects your product outputs.

Climate change has been a major theme across Regnan’s research and engagement services for more than ten years. In our current product outputs, we look to see evidence of companies building resilience to climate change, mitigating risks of the physical impacts of climate change, careful consideration of the regulatory environment and market changes as we transition to a low carbon economy, and the ongoing need for enhanced climate related disclosure. Stocks assessed through the research offering as of elevated concern, may be included as a targeted company for corporate engagement.

Regnan’s advisory offering is also shaped by climate change considerations. It can support clients in managing a variety of climate related risks, but also in capitalising on opportunities for value creation.

11.2. Explain how this long term trend affects your product outputs.

Considerations around resource scarcity are factored into Regnan’s research and engagement. Regnan research analysts assess each company’s exposure and management of resource scarcity risk and incorporate the assessment into the stock’s ratings. These research and ratings feed into Regnan’s engagement program recommendations. If a company’s exposure and/or resource management warrants elevated concern, Regnan will pursue targeted outcomes via direct corporate engagement.

11.2. Explain how this long term trend affects your product outputs.

Technology developments are factored into Regnan’s research and engagement. In stock level assessments, Regnan analysts look to see evidence of sound management of risks and opportunities related to technology developments in exposed companies. Ranging from developments in automation and artificial intelligence, through to developments in clean energy and advanced materials, Regnan assesses the potential impact in areas such as human capital management, board capacity, stakeholder management, environmental management and ethical conduct. If a company’s exposure to and/or management of advances in technology warrants elevated concern, Regnan will pursue targeted outcomes via direct corporate engagement.

SG 12. Business certifications/accreditations

12.1. Indicate whether you have obtained any certifications or accreditations related to ESG/RI and your business activities.

12.2. Additional information. [OPTIONAL]

SG 13. Interaction with asset owners

13.1. Indicate whether you interact with asset owner clients.

13.2. Indicate the typical frequency and type of interactions with your asset owner clients.

Type of interaction






          Formal reporting on engagement activities.


13.3. Tick boxes across level of employment of investor contact (C-level, PM etc.) and subject areas typically addressed with the contact(s).

Level of employment

Subject area(s)

          Regnan provides overviews of activities and progress to client board members at least annually.

Subject area(s)

          Regnan staff are available to client executives (such as CIOs) to discuss stock specific ESG issues or responsible investment trends upon request.

Subject area(s)

          Regnan staff are available to client analysts to discuss stock specific ESG issues or responsible investment trends upon request and provide regular alerts on ESG issues.

Subject area(s)

          Regnan staff are available to client analysts to discuss stock specific ESG issues or responsible investment trends upon request and provide regular alerts on ESG issues.

SG 14. Aligning approach with investor goals

14.1. Describe how you align your organisation’s philosophy on and approach to ESG/RI with investor goals.

          Regnan was established by and for institutional investors, and its philosophy and approach is entirely driven by investor goals to improve the alignment of their investments with long term risk-adjusted returns outcomes and where appropriate, other responsible investment objectives.

14.2. Additional information. [OPTIONAL]

SG 15. ESG recommendations not aligned with investor goals

15.1. Describe what steps you take, if any, when your ESG recommendations are not in line with investor goals.

          Regnan’s core activities involve identifying sources and instances of such misalignment for its clients.

15.2. Additional information. [OPTIONAL]

SG 16. Seeking feedback from clients

16.1. Indicate whether you seek feedback from clients on your RI/ESG services and product offerings

16.2. Describe how you use this feedback on your RI/ESG services and product offerings.

Regnan entire business involves providing RI / ESG product and service offerings on a commercial basis.  In this context, incorporating market feedback is a core business activity.

SG 17. Managing conflicts of interest

17.1. Indicate whether your organisation has a policy for managing potential conflicts of interest.

17.2. Describe how you manage potential conflicts of interest.

Regnan discloses all potential conflicts to affected parties. 

17.3. Describe how you ensure that company employees do not derive any personal gain from the use of information collected during your work process.

Regnan has a securities trading policy applicable to all employees.