On 13 February, NILGOSC was one of a group of asset owners (totalling over £1.2 trillion in assets), led by the People’s Pension, Brunel Pension Partnership and Scottish Widows, who launched the Asset Owner Statement on Climate Stewardship.
The Statement, which was co-signed by 25 other schemes from across the UK, Europe, Australia and the US, defines clear expectations from asset owners around how asset managers should mitigate climate-related risks, structured around five overarching principles. It was drafted in response to complaints from asset managers of inconsistent demands from asset owners, and therefore seeks to set out key and consistent climate stewardship expectations.
The five principles of the Statement are:
- Industry/market and public policy engagement should be core to the climate stewardship proposition across all asset classes.
- Where permissible, asset managers should prioritise collaborative initiatives to achieve greater impact and embed efficiencies in engagement activities.
- Asset managers’ prioritisation frameworks for company engagement should be rooted in a robust theory of change that delivers maximum impact.
- A systematic approach to voting is imperative.
- The stewardship function needs to be appropriately resourced.
The Statement aims to facilitate constructive dialogue on climate stewardship and embed greater efficiencies into the stewardship chain, empowering asset manager stewardship teams to deliver on their asset owner climate objectives as part of their mandates. Ultimately, the group seeks to raise the bar on climate-stewardship across the investment sector.
The Statement, which includes a full list of initial signatories, can be found on The People Pensions’s website.
