Proxy voting is a key part of our engagement program and one of the primary tools we use to influence the behavior of portfolio companies. When organizations are unwilling to improve their ESG practices through dialogue, we aren’t afraid to hold them accountable by exercising our right to vote against management.
/'sher-hōl-dər 'rīts/ noun
Our portfolio managers have engaged with a popular, online entertainment streaming service for several years, meeting privately with the firm to improve its corporate governance and compensation practices. While the firm and its management have demonstrated strong performance over time, we believed that it could strengthen its governance and compensation practices in order to protect shareholders over the long run by promoting accountability for both board and senior management.
Our concerns were the absence of majority voting for directors, a staggered board, no proxy access, and the inability of shareholders to call a special meeting. Additionally, we had concerns whether the CEO’s compensation package was aligned with shareholder interests. Meeting directly reflects our belief that informed dialogue with companies, rather than public confrontation, leads to mutually productive outcomes.
All holders of common shares of company stock have specific privileges and rights governed by the prevailing laws in the state where the company is headquartered. The most important rights possessed by all common shareholders include the rights to: share in the company's profitability, influence management, buy newly issued shares, vote at meetings, and sue for wrongful acts.
A responsible investing factor dealing with employee engagement and development, labor relations, human rights practice, product safety and consumer protection. See environmental, social and governance (ESG) .
Social and environmental impact
An approach that actively seeks to deliver a competitive return alongside a positive, measurable social or environmental outcome. See responsible investing – other RI approaches .
Socially responsible investing (SRI)
Originally, a term used interchangeably with environmental, social and governance (ESG) investing. Typically, legacy SRI approaches have emphasized exclusionary screening.
Sustainable Development Goal (SDG) alignment
Aligning investments to the Sustainable Development Goals – e.g., poverty, health, education, climate change and environmental degradation – to help connect business strategies, objectives and outcomes with global priorities. See responsible investing – other RI approaches .
An umbrella term often used interchangeably with responsible investing. See responsible investing .
Sustainable Development Goals (SDGs)
A set of United Nations goals with a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity. Today, the UN SDGs are an internationally accepted, outcome-oriented roadmap to sustainability for organizations in all sectors.
Aiming to design a company-selection process that emphasizes specific issues or outcomes, e.g., climate change, gender. See responsible investing – other RI approaches .
United Nations Principles for Responsible Investment (UNPRI)
An organization that works to understand the investment implications of environmental, social and governance factors and to support its international network of investor signatories in incorporating these factors into their investment and ownership decisions.
An umbrella term used by some investors, which applies values alignment as the primary driver of investment activity. See responsible investing – other RI approaches .