A closer look at engagement
You'll hear a lot about engagement from ethical investment product providers. Engagement is an important part of responsible investing as it involves not just evaluating companies' responsible business practices, but also actively facilitating their improvement.
We encourage investment professionals to closely examine the way in which engagement is undertaken, as it can take many forms. Some product providers call research or gathering information 'engagement'. But this has no direct bearing on a company's direction or practices.
At The Co-operative Asset Management, when we say 'engagement' we mean tackling companies over issues of concern and championing best practice. For all our funds engagement is rigorous, ongoing and designed to add value to decision-making in the investment process. The impact of our engagement is independently audited to ensure that it continues to set the industry standard.
Engagement in action
In 2006-7, we engaged with Weir Group which had supplied equipment to Sudan, an oppressive regime, for oil exploration and production. In light of the risks this presented, we asked the company to justify its continued involvement and to halt operations in Sudan until a robust peacekeeping force was in place. Soon after, it embarked on a programme of "controlled withdrawal" from the region.
Performance and (UN) Principles
In the 2007 survey of signatories to the UNPRI (see page 4), we scored in the top 10% of all signatories on integrating ESG issues into investment analysis and decision-making processes and being active owners who incorporate ESG issues into ownership policies and practicesxii.
- Responsible investing – the opportunity for investment professionals
- Know your client's values
- Approaches to responsible investing
- Ethical issues at a glance
- Common concerns
- How to evaluate funds
- A closer look at engagement
- A closer look at integration
- How The Co-operative Asset Management can help you
