SLGI Asset Management Inc. incorporates environmental, social and governance factors (ESG) into our process for evaluating, selecting and monitoring sub-advisors. Here is how MFS Investment Management (one of our sub-advisors) describes their approach to engagement:
“Consistent with our ESG integration practices, we believe open communication with companies and issuers is an important aspect of our ownership responsibilities. Our goal when engaging is to exchange views on ESG topics that in our view represent material financial risks or opportunities for companies or issuers and to effect positive change on such issues. We believe that large, long-term oriented asset managers who engage companies and issuers on ESG topics can positively influence governance and business practices by encouraging executive teams to view these issues as relevant to an increasingly broad investor base and worthy of further consideration."
We typically engage with companies and issuers on ESG issues in four ways:
Informal investment team–led engagement
Our investment team engages with companies on a consistent basis, often sharing ideas and asking ESG-related questions of management teams during meetings in our offices. We view these meetings as informal engagement opportunities, as the discussion is not always focused on driving corporate change; often it is about better understanding the risk/return profile of a company’s securities.
Formal investment team–led engagement
Each year, our investment team requests ESG-focused meetings or writes formal letters with the aim of engaging with various companies’ boards on ESG topics.
Collective and other forms of engagement
We often engage with sponsors of shareholder initiatives or proposals, which helps inform our views on important proxy voting issues, and we participate in industry working groups and organizations that seek to develop thought leadership on emerging proxy voting issues. MFS may send letters to regulatory agencies to encourage corporate governance reform when we feel it is warranted.
Formal proxy voting–led engagement
Members of our proxy voting team will engage in a dialogue with a company or other stakeholders when we believe that the discussion will enhance our understanding of certain matters on the company’s proxy statement or to discuss long-term engagement priorities and thematic topics of interest to the team.”
Information contained in this article is provided for information purposes only and is not intended to provide specific financial, tax, insurance, investment, legal or accounting advice and should not be relied upon in that regard and does not constitute a specific offer to buy and/or sell securities. Views expressed regarding a particular company, security, industry or market sector should not be considered an indication of trading intent of any mutual funds managed by SLGI Asset Management Inc. These views are not to be considered as investment advice nor should they be considered a recommendation to buy or sell.
Please note, any future or forward looking statements contained in this article are speculative in nature and cannot be relied upon. There is no guarantee that these events will occur or in the manner speculated. Please speak with your professional advisors before acting on any information contained in this article.