Pension pool Border to Coast regularly exercised its voting rights during 2023’s AGM season to take a stand against how some firms are managing the risks of climate change.
One of the largest local government pension scheme (LGPS) pools has outlined how it voted on behalf of its partner funds.
Breaking down its voting policies, Border to Coast revealed four approaches stood out.
One, it voted against 71% of ‘say on climate’ management resolutions – the initiative to push the world’s largest companies to take action on climate change in line with the 1.5°c trajectory recommended in the Paris Agreement.
Two, it voted against the chair at 50 companies. Three, it voted against their re-election at 95% of oil and gas companies.
And four, voted for 81% of environmental shareholder resolutions.
Border to Coast’s head of responsible investment, Jane Firth, said: “Given we consider climate change a critical risk to the long-term success of some portfolio companies, we are using perhaps the most influential means at our disposal – voting – to support credible proposals that are aligned with achieving net zero.”
Colin Baines, stewardship manager at Border to Coast, added that institutional investors need to think more strategically about how they approach climate change.
“Investors need to be authentic in how they put commitments to net zero and company engagement into practice, resisting attempts to politicise ESG and climate risk management,” Baines said. “Voting across all our funds in alignment with our responsible investment policies and voting guidelines ensures a clarity of approach for our partner funds.”
However, Baines noted: “Many asset owners do not have this assurance and misalignment between asset owners and some asset managers is becoming evident.
“Not only are some investors exposing themselves to accusations of greenwashing by voting counter to their climate commitments, they are also hindering the potential of ESG stewardship to secure quality company transition plans, reduce climate risk, and add long-term value.”
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