Collaborating to set climate stewardship expectations
Today sees the publication of the Asset Owner Statement on Climate Stewardship, a statement endorsed by a coalition of asset owners, from the UK, Europe, Australia and the US, representing around GBP£1.2 trillion of their members funds.
Brunel is proud to have been a leading voice in the creation of this new resource, requested by the industry, that sets out clear and consistent expectations regarding climate stewardship.
As risk of climate-related impacts escalate and we, as well the group believe that asset managers need to intensify their stewardship efforts to address the risk. The statement calls on asset managers to evolve and strengthen their climate stewardship strategies due to the imperative need for climate action.
The Asset Owner Statement on Climate Stewardship, has been developed in direct response to themain challenge identified in the UK Asset Owner Stewardship Review 2023 – an ongoing and material divergence between asset owner expectations and implementation of climate stewardship that limits progress towards a net zero world and better outcomes for beneficiaries.
Five principles, or priorities, have been agreed on by the coalition;
- Industry/market and public policy engagement should be core to the climate stewardship proposition across asset classes
- Where permissible, asset managers should prioritise collaborative initiatives to achieve greater impact and embed efficiencies in engagement activities
- Asset managers’ prioritisation framework for company engagement should be rooted in a robust theory of change that delivers maximum impact
- A systematic approach to voting is imperative
- The stewardship function needs to be appropriately resourced
The statement aims to facilitate constructive conversations on climate stewardship and embed greater efficiencies into the stewardship chain, empowering asset manager stewardship teams to deliver on their asset owner climate objectives as part of their mandates. Ultimately, the group seeks to raise the bar on climate-stewardship across the investment sector.
Vaishnavi Ravishankar, Head of Stewardship at Brunel Pension Partnership, was intrinsic in the development of the statement;
Our collective statement from asset owners responds directly to feedback from our managers to hear from asset owners jointly on climate stewardship expectations and represents an important signal to the market.
The statement signposts what we, as representatives of our beneficiaries’ long-term interests, consider important for fund managers to demonstrate. We expect this to be a living document that will evolve through ongoing dialogues with our managers but in the first instance, codifies what we consider as best practice to inform manager selection and monitoring.
As owners of capital, Brunel, and the coalition, value their asset managers as their strategic partners in delivering value for their members. It was felt that a resource built on existing industry guidance would support and empower their asset managers in delivering on their behalf.
For further information, or to sign up to the statement please contact assetownerstatement@peoplespartnership.co.uk
The above link will take you away from the Brunel website.