Engagement along the investment chain
Pension scheme trustees, at the start of the investment chain, are in a powerful and influential position to ensure their investment beliefs are felt all the way down to the companies they invest in. However, maintaining alignment to these beliefs as the investment decisions move through the investment chain can sometimes be a challenge.
A4S’s ESG Toolkit for Pension Trustees contains a maturity map, guidance, case studies, and third-party resources to help equip trustees with peer-tested practical steps to engage with members, sponsors, advisers, fund managers and investee companies on sustainability-related issues.
MATURITY MAP
The ESG Maturity Map can help you as a pension trustee benchmark your current level of engagement with key stakeholders against best practice. It also provides practical steps that you can take to improve relationships with these actors. Many trustees have also used this maturity map to:
- Achieve consensus across the board of trustees on where their priority actions should be on stewardship, manager recruitment and mandates etc.
- Understand where they are, in relation to other schemes.
- Challenge and probe further into responses from advisers and fund managers on how they are aligning their activities with your investment beliefs.
Guides
These guides have been written for trustees and include insights from peers with suggested practical steps and ‘top tips’. They are designed to support trustees on in-depth discussions related to sustainability considerations with their service providers and internal colleagues. The resources complement more granular work done on the same topic by other organizations, which can be found in the external resources section below.
Case Studies
Our case studies capture the 'what', 'why' and 'how' a pension scheme should effectively engage with key stakeholders across the investment chain. The practical steps taken and top tips suggested are often transferable to large and small pension schemes from different jurisdictions.
External resources
This is not an exhaustive list, but we find that the resources below complement this section of the toolkit.
Achieving effective stewardship through asset managers
This framework can be used to assess the critical components required to deliver effective stewardship and to evaluate the quality of the approach taken by their managers and the outcomes achieved.
Investment manager monitoring
Provides a framework for asset owners to monitor an investment manager’s ESG investment approach, strategy, and performance.
Assessing the climate competency of investment consultants
This guide lays out five themes against which trustees should expect their investment consultants to demonstrate their climate competency. Gives examples of positive and best practice indicators against each theme to help judge competency.
Engaging sponsors
A guide for employers on how to align pensions with their organization’s sustainability commitments.
Engaging beneficiaries
A study on how insight into how decision-making behavior is influenced by the availability of information on the environmental and social impact of funds, alongside standard financial data.
Stewardship document library
To support learning on stewardship, the OPSC document library contains key stewardship documents from the Council members.
Effective Stewardship Reporting
This review identifies good examples of reporting on governance, resourcing, integrating stewardship with investment, and outlines areas where FRC wish to see improvements.
Stewardship guide and voting guidelines
A framework for pension scheme trustees, and investors generally, to ensure that companies are held to account on key issues in the forthcoming AGM season.
Active ownership in listed equity
Outlines concrete steps to make active ownership an effective tool to support long term value creation in liquid equity investing.
Voting expectations of asset managers
This publication focuses on shareholder voting and proposes a standard of voting for 2022. It lays out clear expectations on asset managers on how they can use their voting power effectively.
