ENGAGEMENT & VOTING
Voting decisions and engagement activities are reviewed each week with the Chief Executive Officer, Head of Equities and Head of Corporate Governance.
Voting
We vote on every resolution for all UK equities that are listed in the FTSE All-Share Index. For controversial cases, overseas equities may also be voted. Regular audits are undertaken with companies, to ensure that our voting instructions to the custodian banks are being followed. In our quarterly reports we produce a report explaining the issues which have arisen during the reporting period and stating where we abstained, or voted against resolutions. For clients invested in pooled funds, they can choose to vote in accordance with LGIM’s voting decisions or request that we use voting services such as: RREV (Research Recommendations Electronic Voting) or PIRC (Pensions Investment Research Consultants), because we are able to vote their proportions of the pooled funds according to the recommendations of either voting services.
Our Approach to Engagement
When a report comes to our attention that causes significant concern, we initiate direct contact with the company or advisors to discuss the issue and what remedial action is to be taken. Such contact is with the Chairman or Senior Independent Director, the chairman of a board committee and/or the company’s corporate representatives. If a board does not respond positively to intervention we consider on a case-by-case basis whether to take further action. This may include holding additional meetings with management, registering an abstention or voting against a resolution. The length of time required for monitoring may, and indeed has, extended to over 12 months but depends heavily upon the nature of the issue and company.
Reporting
We report to clients on a quarterly basis on all SRI, Voting and Intervention activities. The Voting reports are available to the public from this web site on the Voting Reports Page.
