Over three quarters (77%) of investment managers support the adoption of an industry standard ‘statement of voting principles’ according to Hymans Robertson in its latest Responsible Investment Stewardship Survey. An industry-wide approach for disclosing the key tenets of investment managers’ voting principles would improve transparency, allow asset owners to make simple comparisons between different managers’ practices and better able to hold them to account, according to the pensions and financial services consultancy.

The triennial Hymans Robertson Stewardship Report also found that despite promising signs of change across the industry with over half (55%) saying they’d increased Responsible Investment (RI) resources, there is still much more that investment managers need to do to keep pace with the changing demands.

Commenting on the findings, Simon Jones, Head of Responsible Investment, Hymans Robertson, says:

“Asset owners have a duty to hold their managers to account on their stewardship practices.  Pension fund trustees should be fully prepared to challenge their managers if they feel the approach being taken is inadequate, but they need better and more consistent information to be able to do so.  Managers should be able to explain why they have taken the voting actions they have on issues such as climate change and if managers can’t answer questions adequately, trustees should continue to press for clarity.  Ultimately, pension fund trustees retain the ability to change managers where practices are deficient with stewardship likely to become an increasingly important differentiator in future.”

Discussing further steps that need to be taken as we emerge from the current pandemic, Simon continues:

“It was encouraging to see that over half (55 per cent) of those asset managers we surveyed had increased resources devoted to RI activity over the previous year although managers need to ensure that underlying practices continue to improve need.  Responsible investment has been in the spotlight through the current COVID-19 pandemic with a renewed focus on the relationship between companies and their stakeholders.  As we emerge from the crisis, investors will return to consider how and where their pensions are invested and we suspect that levels of scrutiny will be higher than ever.  This simply reinforces the need for pension fund trustees to have clear and effective disclosures from their managers.”