Stewardship and our voting preferences for upcoming AGMs
Sustainability and acting as a force for good in the world is hugely important to us, our goal is to be in the top 25% of responsible business in the UK by 2025.
We’re committed to helping our customers grow their savings over the long-term and contribute to a more sustainable world. We also recognise that companies like us have a responsibility to walk the talk – we have a fiduciary duty to our customers and the opportunity to be part of the transition to a low-carbon economy.
As one of the largest asset holders in the UK today – we embrace that responsibility. As a long-term savings provider stewardship is core to what we do.
An ‘asset owner’ is an organization who represent the holders of long-term retirement savings, insurance and other assets.
Our customer surveys show that 73% of our customers agree climate change is an important risk when investing.* We’ve also seen that our customers are concerned about the local effects of climate change such as droughts and deforestation.
What stewardship means
Stewardship is the responsible allocation, management, and oversight of capital to create long-term value for customers and beneficiaries leading to sustainable benefits for the economy, the environment and society. It’s a commitment by asset owners and fund managers to champion customers and beneficiaries’ interests – and use their influence to promote sustainable value and change.
This generally involves voting at shareholder meetings (like an AGM), proactively engaging with companies to make sure they are being managed for long-term benefit, supporting good governance, prudent capital allocation and sustainable business practices.
Our approach to voting as an asset owner
As an asset owner, we hold funds as opposed to direct company stock for the most part making us an indirect investor. This means that most of our funds are managed by third-party asset managers. We don’t hold voting rights on our investment funds or typically engage directly with companies as Aegon but are invested in pooled funds that are managed by multiple fund managers.
We develop our voting preferences based on our Stewardship Framework, considering our own research, our customer views, and engagement with asset managers. Through ‘expression of wish’ we signal our position against companies in advance of the AGMs through our voting preferences shared with key asset managers.
The ‘expression of wish’ represents our current voting approach and optimises how we use our influence as an asset owner on the larger company stock holdings of our principal asset managers.
The level of alignment between managers’ votes and our ‘wishes’ is a key consideration in our manager oversight, and we look to engage on or escalate any areas of consistent divergence with our asset managers.
Our voting preferences for upcoming AGMs
As part of our commitment to the Financial Reporting Council’s 2020 Stewardship Code, we believe in transparency. Ahead of Shell and Glencore’s upcoming AGMs, here’s our statement of the actions we’ve taken:
Shell plc: We’ve pre-declared our voting preferences via ‘expression of wish’ for the upcoming Shell AGM on 23 May 2023. We support our asset managers voting for the independent shareholder resolution on climate for several reasons. Setting Paris-aligned targets covering Scope 3 is key, because Scope 3 accounts for the majority of Shell’s total Scope 1, 2 and 3 emissions. However, we note that the company’s current intensity target covering Scope 3 for 2030 is not yet Paris-aligned. We support the overall aim of this proposal and believe Shell has more to do in providing a credible approach to mitigating its impact on climate change.
Glencore plc: We’ve pre-declared our voting preferences via ‘expression of wish’ for the upcoming Glencore AGM on 26 May 2023. We support our asset managers voting for the independent shareholder resolution on climate for several reasons. While Glencore said it is committed to the responsible decline of its fossil fuel portfolio, we believe there is a lack of clarity on how its thermal coal production aligns with emissions reduction commitments. We encourage Glencore and peers to provide further transparency on their approach to managed phase-outs and/or divestment for high emitting assets incompatible with a 1.5 pathway (in particular thermal coal and oil sands), in line with our Stewardship Policy.
Find out more
We’re due to publish our 2022 Responsible investment and stewardship report in the next few weeks. To find out more about responsible investing, you can visit our Responsible Investment hub, or view our Sustainability matters webpages.
*Source: Aegon RI Customer Panel survey, August 2022. Sample size: 1220 customers, mix of Aegon customers and non-Aegon customers