We express clear expectations of the companies and markets we invest in. Companies must be run properly, and our rights as a shareholder must be protected. Companies must also understand their impact on the environment and society, and address negative effects.
Our expectations cover ten key sustainability topics and provide a starting point for all of our engagement with the companies. They are based on our dialogue with companies, academics and civil society and international standards such as the UN Global Compact and OECD guidelines. The expectations also largely coincide with the UN Sustainable Development Goals.
We expect companies to address challenges relating to climate change, water management, ocean sustainability and biodiversity.
We expect companies to respect human and children’s rights, and to be aware of how they manage human capital. We also expect companies to understand and address relevant consumer-related risks.
We expect companies to have clear guidelines and take effective action to combat corruption. They should also adopt appropriate and prudent tax policies and be transparent about where they generate economic value.
We publish position papers setting out our views on specific aspects of corporate governance. Together with our expectation documents, they serve as a starting point for our dialogue with companies and standard setters. These positions are also reflected in our global voting guidelines, which form a basis for our voting at shareholder meetings.
We express clear expectations of companies and share our views on how they should be managed.
We assess companies against these expectations and positions.
We follow up with dialogue, voting and potentially divestment.
We are in regular contact with the companies we invest in. We want to understand how they are run and how they address sustainability-related risks and opportunities. We focus on selected topics that are important for the fund’s long-term return and monitor companies over a number of years.
Our voting at companies’ annual shareholder meetings plays an important role in safeguarding the fund’s assets. Shareholders elect the board and approve key decisions at a company. We aim to vote at all shareholder meetings at portfolio companies.
We may divest from companies if we believe that their business activities expose the fund to unacceptable ESG risks, and engaging with the company has failed or is unlikely to succeed. Risk-based divestments are financial decisions and may be an appropriate response following a broad evaluation of the impact on the fund. This mechanism is generally used for a limited number of small investments where we have identified systematic mismanagement of ESG risks.
Our expectations cover ten sustainability topics and are based on our dialogue with companies, academics, civil society and international standards such as the UN Global Compact and OECD guidelines. They also largely coincide with the UN Sustainable Development Goals.
We have drawn up ESG guidelines for our investments in unlisted real estate and renewable energy infrastructure. The guidelines provide a basis for our dialogue with investment partners and asset managers.