Enhancing Stewardship Engagement Through Your Asset Managers
Examples of tactics and questions for pension fund chairs and trustees
Through our work with the A4S Asset Owners Network, we were asked by members to provide a list of both approaches and specific questions that peers have used effectively in stewardship activity.
Split between the different stages of an asset owner – asset manager relationship, we have set out tried-and-tested examples to strengthen stewardship impact through asset manager engagement. It includes practical questions and examples to support trustees across recruitment, monitoring and voting, helping to move beyond high-level commitments and towards more detailed, outcome-focused conversations.
This short guide includes examples such as:
During recruitment: Changing a question on whether they have sustainability-related targets at the recruitment stage to ‘How are sustainability-related factors at both an entity and portfolio level evaluated, and what scenario analysis approaches do you follow?’
During monitoring:
- Setting an annual expectation from the Chair on sustainability intent, positions on high-priority sectors and expectations of the manager – using this to inform monitoring meetings.
- Asking specific questions like ‘How are your holdings in X and Y consistent with your approach to stewardship and long-term investment, considering the clear risks associated with these businesses?’
- Balancing quantitative data demands with a report on outcome-based progress, eg the percentage companies in the portfolio that are actively transitioning and how this compares to market average.
During voting: Asking one or two focused questions, eg ‘What votes have you made against the re-election of directors [in X sector] on climate or nature-related grounds?’
While written for engagement with asset managers, many of the examples can also be applied to discussions with other service providers, including investment consultants.
Download the guide to explore practical actions and example questions for chairs and trustees to enhance stewardship engagement.
