What do investors think of our business?
During the year there were a number of investor based discussions on our performance as a responsible business. Their opinions matter because it will lead to a public performance rating or an instruction to their clients to invest in our business.
We are seeing that this group of stakehholders are looking for two things
- ever improving standards of doing business responsibly
- a view on the long term issues that are material to the business strategy
What does LGIM think of the Group’s performance?
Having one of the biggest investment managers in Europe as part of your company helps.
Their governance expertise means they’re able to challenge the Group’s responsible business performance based on high levels of interaction with other listed companies. In fact, through a number of engagements with our own executive they have changed and enhanced a number of processes and practices within our Group, including:
- Ethics governance structure – implemented
- Executive pay and disclosure – implemented
- Country level tax disclosure – implemented
- Global compact signature – implemented
- ESG in Legal & General’s own pension fund – ongoing
- Living Wage campaign – the Group intends to sign up to this in Q2 2013
- Cluster munitions exclusion from internal investment holdings – ongoing
- Asset allocation into low-carbon assets – ongoing.
In Q4 2012 we asked the corporate governance team within Legal & General Investment Management to critically review our own environmental, social and governance performance (ESG). This is how they scored us.
They asked us to do two things to improve the way we do business:
- produce a clear statement in our reporting that shows that our business is future ready; and
- look at producing an explicit permitted investment policy showing our stakeholders exactly which assets we will and won’t hold on behalf of shareholders and our clients when running our business.
We are working with LGIM to develop a publishable macro drivers view of our future marketplace for publication in 2013.