We’ve published our fourth Responsible Investment (RI) report, which highlights how our key stewardship and governance activities contribute towards positive financial, societal and environmental outcomes.
Our approach to RI
We believe that acting as a responsible asset owner protects and enhances the value of our investments. The management of ESG risks and exploitation of Environmental, Social and Governance (ESG) opportunities can add value to our portfolio.
Barry Kenneth, Our Chief Investment Officer, said, “Despite a challenging financial backdrop over the last 18 months, we continue to recognise the value of strong stewardship and ESG integration as part of the wider investment process. The focus on understanding long-term material risks and opportunities has continued, with improved data accessibility, reporting and analysis across the portfolio.
“Our team has always firmly believed in understanding our risks and doing so using evidence-based data. The development of our Climate Watchlist is a huge step forward for us to focus our efforts on our most emitting investments. Having seen the progress this has made in our utilisation of external data, I am excited about what could be possible in future years.”
Progress within our priority areas
Our report highlights the progress we’ve made within our RI priority areas of stewardship, climate change and reporting:
- Stewardship: This year we were accepted by the Financial Reporting Council (FRC) as a 2022 signatory to the UK Stewardship Code. This is our second consecutive year as a signatory. The UK Stewardship Code sets high stewardship standards for those investing money on behalf of pensioners.
- Climate change: This year we created our first-ever Climate Watchlist as part of our work to encourage our investments to contribute to a fairer, more sustainable future. The watchlist focuses on the companies contributing to over 70 per cent of the greenhouse gas emissions and carbon footprint of our investments.
- Reporting: We work with our managers to improve their ESG and stewardship disclosures, and engage with issuers and public policymakers to explore ways to improve the quality of ESG data disclosure. This year we engaged extensively with managers with a focus on reporting, engagement and using their voice for positive sustainability/ESG outcomes and focussed on extending this to our private markets’ managers too.
Claire Curtin, our Head of ESG and Sustainability, said, “We’ve built our responsible investment strategy and stewardship processes in line with the long-term nature of our liabilities and our investment horizon. We embed material ESG considerations right across our investments as well as expecting the same from our external managers.”
Find out more in the full report.