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Investors have been asked to support linking investment stewardship to the creation of 'long-term sustainable value' in the UK StewardshipCode, in an alternative definition to 'watered-down' proposals by the Financial Reporting Council (FRC).
Laith Cahill, Senior Net Zero Stewardship Specialist at the IIGCC, says the UK’s streamlined StewardshipCode must preserve its ambition. The StewardshipCode plays a key role in influencing global practice and rigour. These are both critical elements in investors’ stewardship toolkits.
The StewardshipCode says a measure of your engagement quality is case studies. It’s really important that we present one view.” She added that unlike other competitors it also didn’t split its vote at company AGMs. “We That is one way. We believe it dilutes the effectiveness of engagement,” she said.
Clearing’s present danger – Financial market infrastructures are waking up to climate risks, even as some central banks are scaling back their work in this area. Another long-awaited announcement came from the UK’s Financial Reporting Council (FRC), which confirmed the start of its StewardshipCode 2020 review.
A 2019 study of the stewardship activities of the big three index fund managers – BlackRock, Vanguard and State Street – found that there was no engagement with 90% of investee companies over three years, with a further 5% of firms experiencing a single engagement.
The concept of assessing what effective stewardship should look like was first introduced by the FCA in 2019 in a joint effort with the Financial Reporting Council (FRC), setting the groundwork which helped define what the minimum expectations should be for financial services firms investing on behalf of clients and beneficiaries.
For sustainable investment professionals, reporting against the Sustainable Finance Disclosure Regulation (SFDR) or the Task Force on Climate-related Financia Disclosures, stewardshipcode disclosures, and standardised, comparable corporate reporting are now part of the day job. Policy takers and policy shapers.
Although present data coverage may not be perfect, it is improving rapidly, and our requirements will help to accelerate this process significantly,” said a statement by DWP Secretary of State Therese Coffey and Pensions Minister Guy Opperman.
The surge in ESG-labelled investment has been accompanied by a comparable flood of ratings, but the patchwork nature of regional data presents challenges. .
Institutional investors in the UK and beyond have been near-universal in their praise for the role of the 2020 StewardshipCode in improving the quality of stewardship and engagement by asset owner and manager signatories, supporting short- and long-term investment objectives.
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