Church investors will take a tougher line on shareholder resolutions

10 Mar 2020 News

The Church Investors Group (CIG) has told the leaders of FTSE 350 companies that it will be raising its expectations on diversity and modern slavery during this AGM season.

The CIG represents 70 members and has £21bn in assets. It believes action is required to ensure all FTSE 350 companies recognise their role in overcoming global challenges, and has introduced a range of new criteria to its framework for voting on shareholder resolutions.

The group has regularly voted against executive remuneration schemes and against the reappointment of directors when pay schemes are particularly excessive. It votes against the reappointment of directors who are members of nomination committees that have not ensured their boards have a minimum level of boardroom gender diversity. 
 
It said that this year it will now vote on boardroom diversity beyond UK listed companies, review auditors’ reports to ensure they have not failed to identify and communicate to shareholders the risks associated with climate change, and will not support reports and accounts where a company’s modern slavery statement is inadequate.

The CIG will also review director remuneration, and analyse any political lobbying or trade association memberships that run contrary to the company’s stated position on climate change.

'Increasingly active' 

The largest members of the CIG include the Central Finance Board of the Methodist Church, the Church Commissioners, the Church of England Pensions Board, and the CBF Church of England Investment Funds.

Shelia Stefani, corporate governance specialist at the Church of England, said: “The further strengthening of our voting template supports the increasingly active role church investors are playing at company AGMs. Companies should expect investors to be raising issues and incorporating ethical, environmental, social and governance issues into voting.”
 
The Revd Canon Edward Carter, chair of the CIG, added: “Church investors have led the way in using their votes at company AGMs, including voting on the reappointment of directors. These new criteria are all about expecting companies to play a responsible role in society.”
 
During 2019, the CIG applied its voting template to over 5,000 management proposals across more than 250 FTSE 350 constituent companies. It voted against management proposals over 750 times.

New for 2020, the Charity Finance Responsible Investment Conference takes place on 23 June 2020. This one-day, multi-streamed conference will be a one-stop-shop for you to get to grips with the investment options and opportunities that are available without compromising on financial returns. Find out more here.

 

 

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