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We're Engaged! Tools for effective ESG engagement with companies

  • ,  Chief Executive |
  • 02 Jul 2019
  • Updated 04 Jul 2019

The Why and How of ESG Engagement: selected white papers

There is an ever-increasing expectation amongst stakeholders that asset owners and asset managers will engage meaningfully with company management on ESG issues. Below we highlight some of the best, recent white papers and research, providing tips, tools and examples of how investors can actively engage company management for the benefit of all.

corporate engagement

Proxy voting: A key tool in structured engagement (Eaton Vance, 2019)

For compliance reasons, this paper is only accessible in the United States and Canada

This four-page report from Eaton Vance and Calvert illustrates how the shareholder proxy vote can be a catalyst for change. Calvert explain their guidelines on proxy voting and how companies that combine strong governance and social responsibility can avoid unnecessary financial risk while serving the interests of both shareholders and stakeholders.

How bondholders can engage companies for the benefit of all (Hermes, 2019)

In this second part of a two-part paper, Hermes' Head of Research & Sustainable Fixed Income and Head of EOS both explain how bondholders - not just equity holders, can play their part in promoting the interests of all stakeholders.

Tackling the plastic age (NNIP, 2019)

The majority of plastics end up in landfills, the ocean or elsewhere in the environment. Committed to engaging for change on plastics, NN Investment Partners has identified three key areas in order to focus on sustainable solutions in: waste management, recycling and future innovation.

Active engagement for passive investors: A new model in Japan (Fidelity Intl)

For compliance reasons, this paper is only accessible in the UK & Europe

In this short, 2-minute blog post, Fidelity explains how in Japan, firms are now discretely improving their corporate governance in order to address the perceived "value gap" that has persisted in the country's stocks in recent years.

ESG Proposals and Shareholder Activism (Amundi AM, 2019)

For compliance reasons, this paper is NOT accessible in the United States

This 72-page working paper from Amundi and ESSEC Business School studies the efficiency and results of shareholder activism by SRI funds for the period 1996-2015.

Using engagement to unpick the Korean Discount (Robeco blog, Jun 2019)

Ronnie Lim, Senior Investment Specialist at Robeco, highlights how foreign investors can unlock value at Korean companies and tackle the "chaebol" through following the Stewardship Code.

How ESG Engagement Creates Value for Investors and Companies (PRI, 2018)

This 30-page report, commissioned by the UN's PRI (Principles for Responsible Investment), highlights three areas where ESG engagement creates value for stakeholders. It includes recommendations for companies and for investors, including advice on how they can improve the value of their communication with one another.

Board effectiveness: Lessons from companies to trustees (LGIM, 2019)

For compliance reasons, this paper is NOT accessible in the United States and Canada

Good boardroom governance is crucial. Regardless of organisational size and scope, there is no universal approach as to how boards should be run but in this 5 page piece, LGIM discuss ways to evolve and enhance efficiency.

ESG: Do you or Don't you? (UBS AM, 2019)

Dennis Fritsch of Responsible Investor Research partners with UBS to give readers a fascinating insight into how asset owners are viewing the integration of ESG into investment processes and whether ESG, as a whole, is seen as a risk mitigator, performance enhancer or an unnecessary distraction.

The impact of ESG momentum on valuations (Lyxor ETF, 2019)

For compliance reasons, this paper is only accessible in the UK & Europe

This Lyxor report relays MSCI's investigation into whether improving corporate management of ESG risks, measured by changes in ESG scores – or as MSCI calls it, ‘ESG momentum’ – is predictive of share price performance.

Podcast: Amplified - ESG Investing and Stewardship (Hermes IM, Jun 2019)

In this 15-minute podcast, Hermes CEO, Head of Investment & Head of EOS all discuss how ESG, responsible investment and stewardship are now very much mainstream investment themes and how these themes are challenging established investment philosophies for investors, asset owners and companies.

A study of asset-owner priorities for ESG investing in Asia (The Economist, 2019)

Sponsored by Amundi, the EIU conducted interviews with 15 top thought leaders from the world of asset management, development banking, sustainable investing and ESG advocacy to discover the role that asset owners have to play in sustainable/ESG investment in Asia.

ESG Integration in Asia Pacific: Markets, Practices and Data (CFA Institute, 2019)

The CFA Institute and Principles for Responsible Investment (PRI) examine the factors, trends, drivers and impact of ESG investment in the Asia Pacific region focusing on Australia, China, Hong Kong, India, Japan and Signapore.

Podcast: How ESG investing has evolved in the past six years (Hermes IM, May 2019)

Portfolio managers Lewis Grant and Louise Dudley from the Hermes global equities team examine how the ESG investing landscape has evolved over the past six years.

Green Investments: Pick Your Poison (Fidelity Intl blog, Jun 2019)

For compliance reasons, this paper is only accessible in the UK & Europe

Fidelity takes a brief look at green investing and how the perception of what is "green" can change over time due to scientific, market and societal consensus (3 min. read)

Opioid exposure presents risks to pharmaceutical industry (Eaton Vance, Jun 2019)

For compliance reasons, this paper is only accessible in the United States and Canada

Eaton Vance and Calvert assess the risks for companies linked directly or indirectly to to the opioid value chain and present three key corporate governance observations that the ESG investor may wish to be aware of.