Responsible Investor
We strive to be responsible stewards of our clients'
assets within a framework of good governance and
transparency
Responsible investment is an integral part of our investment
philosophy and approach, as well as our approach to business more
broadly. We believe the rationale for long-term responsible
investment is clear; stronger economies and well-run or improving
businesses that look to the future will deliver stronger, more
sustainable investment returns. Being a responsible investor helps
us to generate better informed investment decisions and outcomes
for our clients.
At Columbia Threadneedle our investment approach is underpinned
by a belief that sharing insights across asset classes and
geographies generates a richer perspective on global, regional and
local investment landscapes. Consistent with this core belief, our
dedicated Governance and Responsible Investment team has worked
alongside our investment professionals since 1998, facilitating
integration of material Environmental, Social and Governance (ESG)
analysis into the investment process. In addition to exercising our
stewardship and monitoring responsibilities, this approach enables
us to consider the risks and opportunities of existing and
prospective investments. The work we do for clients was recognised
when we were named ESG Asset Manager of the Year at the Pensioni e
Welfare Italia awards 2017.
Columbia Threadneedle subscribes to and is a signatory to the
United Nations-backed Principles of Responsible Investment (PRI)
and in 2017 we again received an A+ rating in EMEA from the PRI for
our overall approach. In the UK we are also a signatory to the
Stewardship Code.
Our Responsible Investment Policies set out the underlying
principles we draw upon, explaining how our approach is structured,
how it works in practice and how it fits into, and contributes to,
our overall investment approach, processes and related stewardship
engagement activities.
These policies can be found on our website.
Our approach to engagement and voting is based on collaboration between our portfolio managers, analysts and responsible investment team. This approach saw our engagement work ‘Highly Commended’ in an open vote of UK Company Secretaries at the ICSA Awards 2017. During 2017, we voted at 1,231 company meetings, registering our dissent against one or more resolutions at 63% of those meetings.
Columbia Threadneedle Proxy voting 2017
Source: Columbia Threadneedle Investments, ISS ProxyExchange, 31 December 2017.
Over the course of 2017, we took voting action at 144 companies across many countries (generally on the re-election of Board Nomination Committee chairs). We adopted a specific voting approach to gender imbalance, to help emphasise the ongoing importance of this issue. Our approach was designed to identify and escalate the matter with those companies that had failed to make progress in addressing a gender talent imbalance, despite the impact of the UK’s Davies Review (2011) and similar initiatives in many developed countries. The Davies review recommended all Chairmen of FTSE 350 companies set out a target percentage of women on their boards, with a recommended target of 25% by 2015. Considerable progress has been achieved, prompting our focus on notable laggards.
In 2017 we increased the timeliness of our public vote disclosure, publishing our voting decisions seven days after the relevant general meeting (previously 14 days). Our proxy voting activities can be found on our website.
Our Governance and Responsible Investment team takes a leading role in representing the investor voice. We are selective in choosing the areas where we participate, focusing on those we believe have the most impact and benefit for our clients.
Our support for the development of social impact investing continued during 2017, most notably through two initiatives.
- We dedicated a cross-disciplinary team of experts to work with the UK Advisory Group on Social Impact Investing, including our Deputy Global CIO, Mark Burgess. This UK Government-convened review was established to determine how a culture of social impact investing could be fostered, reporting in November 2017.
- Our ongoing work with ICMA continued as part of the working group that produced the Social Bond Guidance in 2006. The group published a full set of Social Bond Principles in June 2017. Following this work, in November an unprecedented number of ‘specific use of proceeds’ bonds was issued, three arriving on 14 November (those of the African Development Bank (ADB), BayernLabo and Cassa Depositi e Prestiti).
Further examples of our work can be found in our quarterly ESG reports, available on the website.
We have continued to develop our responsible investment product range this year in response to investor demand. In May of 2017 we launched our third Social Bond strategy, focused on Europe, in partnership with leading European social enterprise INCO.
Alongside our UK Ethical Equity strategy and our Low Carbon Workplace strategy, the Social Bond strategies reflect the growing focus we have had in developing social and sustainable outcome solutions for our clients.