We believe that environmental, social, and corporate governance (ESG) issues can affect the performance of investment portfolios (to varying degrees across companies, sectors, regions, asset classes and through time).
We also recognise that this may better align investors with broader objectives of society.
Since 2008 we have based our responsible investment policy on the six UN Principles for Responsible Investment of which we are a signatory.
In order to implement the principles and our voting policy we work in partnership with our investment managers and Global Engagement Services (GES), our specialist responsible investment engagement overlay provider.
In 2015 we joined the Local Authority Pension Fund Forum (LAPFF). LAPFF brings together 65 local authority pension funds with combined assets of over £175 billion and provides a unique opportunity to maximise the influence of local authority pension funds as shareholders whilst promoting corporate social responsibility and high standards of corporate governance amongst the companies in which we invest.
We do not seek to influence our managers' investment portfolios but rather act as an active owner and engage in depth with portfolio companies in regard to international norms.
We believe this approach is better aligned with the fiduciary duty and protection of value and ultimately more responsible than an ethical or values based exclusion policy.