Eighth Active Ownership annual report released highlights continued quality of engagement, with 52% of companies now based outside the UK.
16 Apr 2019
Legal & General Investment Management (LGIM), one of the largest investors in the UK stock market, voted against a record number of companies globally in 2018, according to its annual Active Ownership report from the corporate governance team, released today.
The Active Ownership report reveals that LGIM voted against 3,864 company directors globally. This was a 37 percent increase from 2017, having strengthened its voting policies last year. Votes against chairs of boards on diversity and audit related issues hit record highs in the UK, while executive pension contributions became a more prominent area of engagement. Climate change, board effectiveness and remuneration continued to drive engagement with companies globally, with over half of companies based outside of the UK.
According to the report, diversity related issues, audit, pension remuneration, board effectiveness and climate change were key areas of engagement and issues where LGIM has introduced new initiatives to influence change.
Diversity drives record number of votes in UK
LGIM voted against the largest number of UK chairs to date in 2018 on the issue of gender diversity, with over 100 votes cast, up from 13 in 2016. An increasingly global issue, LGIM has voted against all-male boards of S&P 500 companies since 2017 and now also does so globally.
It has also announced that from 2020 it will vote against the largest 100 companies in the S&P 500 and S&P TSX – two major indices in the US and Canada, where there are currently less than 25 percent of women on boards.
Sacha Sadan, Director of Corporate Governance at LGIM: "2018 was a year of record client demand for our work as we continued to engage with companies and regulators on a broad range of issues, using our voting power to influence change... We are encouraged by much progress being made but there remains more to be done and real success will be dependent on collaboration – companies need to create long-term sustainable business models and deliver value for investors."