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Workers’ Capital News - March 2014

In this issue:

  • Shareholder Activism

    UK pension funds join Teamsters on employee rights shareholder proposal at National Express/ Focus on efforts to address carbon risk by institutional investors/ Proxy spotlight on France: the responsible dividend

  • Governance and Disclosure

    TUAC & L20 at the G20/OECD Task Force on Long-Term Financing by Institutional Investors/ Japan to publish first list of signatories to Stewardship Code in June

  • Pensions and Investments

    France's ERAFP measures carbon footprint of listed equities portfolio/ AFT’s Ranking Asset Managers report: 2nd edition

Shareholder Activism

UK pension funds join Teamsters on employee rights shareholder proposal at National Express

A shareholder proposal has been filed with National Express, drafted by the International Brotherhood of Teamsters and co-sponsored by three UK pension funds of the Local Authority Pension Fund Forum (LAPFF), as reported by IPE, Professional Pensions, and MarketWatch. Aimed at addressing systemic problems in the company’s human capital management practices in North America, the shareholder proposal calls for the implementation of an enforceable workplace human rights policy and oversight for human capital management at the company to be assigned to the Board’s Safety and Environment Committee. The focus on employee relations is raised by UK pension fund co-sponsors as a concern for long term investors to ensure sustainable returns by respecting workers’ rights. The proposal will be put before shareholders at the company’s Annual General Meeting, taking place 15 May 2014. 

Focus on efforts to address carbon risk by institutional investors 

 A number of shareholder efforts are currently underway to target corporate carbon risks, as Pension & Investments reports. CalSTRS is leading an engagement initiative reaching out to both companies and asset managers on carbon risk exposure, while other US pension funds, including New York State Common and Connecticut Retirement Plans, have filed shareholder proposals asking energy companies to analyze carbon risk in their expenditures and operations. The article also references an index fund that has been developed by AP4 in partnership with Northern Trust Investments that excludes companies with major reserves of fossil fuels and high emissions of greenhouse gases.

Proxy spotlight on France - the responsible dividend 

 See the recent CWC blog - The Responsible Dividend: What is it?

Governance and Disclosure

TUAC & L20 at the G20/OECD Task Force on long-term financing by institutional investors

The TUAC has submitted comments on the implementation of the G20/OECD High Level Principles on Long-Term Investment Financing by Institutional Investors. The comments focus on developing guidance to ensuring that measures taken to mobilise institutional investors to shift to “patient, productive and engaged capital” take a responsible approach. Key areas of focus include support for decent work, specific guidance environmental, social and corporate governance risks, and accountability of asset managers to asset owners.

Japan to publish first list of signatories to Stewardship Code in June 

As reported in Responsible Investor, Japanese pension funds and asset managers who wish to be initial signatories to the Japanese Stewardship Code have until the end of May to sign up in order to appear on the first list supporting the “Principles for Responsible Institutional Investors”. The Code outlines seven principles, providing guidance to investors on their stewardship responsibilities and closely follows the comply-or-explain voluntary model of the UK. 

Pensions and Investments

France's ERAFP measures carbon footprint of listed equities portfolio

As part of its commitment to long-term and responsible investment, the French public sector fund ERAPF has conducted its first audit on the carbon intensity of its equity portfolio, IPE reports. At 329 metric tonnes of CO2 equivalent per million Euros of sales, the carbon footprint of ERAPF’s listed equities portfolio is 19% less than the overall market (when compared to the MSCI All World Index). This result points to the success of ERAPF’s best-in-class investment strategy to select sustainability leaders, based on environmental as well as social and governance criteria.

AFT’s Ranking Asset Managers report: 2nd edition

The American Federation of Teachers has released a second edition of the Ranking Asset Managers report to reflect action that several asset management firms have taken to cut ties with organizations that advocate for defined benefits planned to be dismantled, as well as to  identify further firms managing plan assets while undermining retirement security. The report also includes additional examples of polices and actions that pension plans have implemented to improve transparency and disclosure.

*Please note that viewing linked articles requires registering for free in the case of IPE online, and a subscription in the case of Responsible Investor.

Disclaimer: The CWC News Digest is a compilation of news items covered in industry publications. The content does not necessarily reflect the views of the CWC or its members. Comments and reflections on news items may be sent to acard@share.ca

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