The influence of your investments: the power of voting and engagement
Marketing Communication
Where you choose to put your money could have an impact on the world. This isn’t just because the capital you invest helps companies achieve their financial goals. When you invest in a company, you become one of its shareholders, either directly or indirectly1, meaning you have a say in how that entity is run.
That’s why it is important to entrust your money with an asset manager that is aligned with your values. How asset managers vote and engage should be key considerations for you before investing your money. Asset managers’ records in these areas have come under scrutiny due to increasing investor and regulatory interest in environmental, social and governance (ESG) matters.
Voting refers to how an asset manager votes on resolutions at shareholder meetings. This means that asset managers potentially could have the ability to influence the policies of any companies in which they have invested.
Voting could cover a range of matters such as mergers and acquisitions, and could also be focused on ESG issues such as climate risk.
Engagement can be defined as the dialogue between shareholders and companies with a clear ESG objective. It can be initiated by a company seeking investor views, or it can originate from shareholders if they have concerns.
Themes covered in engagement could include climate strategy, diversity, and governance.
Most companies hold an annual general meeting (AGM) once a year. At the AGM, shareholders vote on resolutions that can be submitted by the company’s directors or other shareholders, who may be individuals, corporates, asset managers or pressure groups. Resolutions cover a wide range of topics, but recently we have seen an increased focus on ESG targets. Labour rights, greenhouse gas emissions and a company’s impact on biodiversity are just some of the other issues that might be addressed.
At AGMs, some asset managers’ votes on resolutions may play a crucial role in ensuring that companies prioritise their ESG commitments. When you invest in an ETF, your asset manager indirectly represents you at the AGMs of the companies held within the ETF.
This may influence who you choose to invest with, as you may want to ensure your asset manager actively engages with the companies the fund is invested in. Given enhanced ESG-related regulatory requirements and increased interest in the topic among investors, this is more important than ever. In the European Union, in particular, responsible investing is becoming a priority.
Since Amundi’s creation in 2010, ESG has been at the heart of our growth story. We believe that asset managers carry a responsibility towards society. We also believe that considering ESG factors in investment decisions will drive positive long-term financial performance.
Amundi was ranked third out of 69 of the world’s largest asset managers on voting on environmental and social-related shareholder resolutions, according to ShareAction’s latest report.
Over the last three years, Amundi has shown consistency in its voting records in supporting ESG resolutions2.
This is because we have always considered responsible investment as core to our values. We want to deliver long-term sustainable value to our investors – and we feel we can only do this by taking into account the challenges the world is facing. If we ignore these challenges, we are ignoring risks, and that could be detrimental to our investors' capital.
We don’t just vote on resolutions at AGMs; we monitor the outcomes of our engagements and report on them. Details of our full voting records can be found here.
Source: ShareAction report: Voting Matters 2023
Voting and engagement are powerful tools. There are many real-life examples of change brought about by engaging with companies through voting. In response to our recent work with companies, for example, we have seen shipping companies commit to net-zero targets, food companies report on their carbon emissions, and oil and gas companies link executive pay with climate targets.
We will continue to prioritise ESG in our voting decisions and use our shareholders’ votes responsibly. In this way, we ensure that we’re doing our utmost to bring about positive social and environmental change on behalf of our clients.
Voting and engagement are powerful tools. There are many real-life examples of change brought about by engaging with companies.
1 You can invest in a company directly by buying its shares, or indirectly through a fund or ETF.2 See ShareAction Voting Matters reports covering 2021, 2022, 2023 for Amundi’s voting records.
