Active stewardship
Responsible investment (‘RI’) is fundamental to our investment approach. As a long-term investor and representative of asset owners, we are committed to the effective and active stewardship of the companies in which we invest, regardless of asset class.
We believe businesses that are governed well and manage environmental and social factors are more resilient, able to survive shocks and have the potential to provide better financial returns for investors. It is therefore important that responsibility for RI does not sit with a single, siloed team, but is embedded throughout the organisation with appropriate oversight.
Our approach to RI is developed in collaboration with our Partner Funds. We embed environmental, social and governance (‘ESG’) analysis into our investment process across all asset classes.
Access our Responsible Investment reports
Our approach
At the core of our approach as a responsible investor is our role as an active steward of our customers’ capital. We know we are stronger together, and we use our collective voice to hold companies to account via voting and engagement in order to have a real world impact, all in pursuit of our purpose to make a difference.
How do we do this?
Watch the video to the right to hear Jane Firth, our former Head of Responsible Investment, explain our approach to engagement, what we mean by ‘active steward’, and how our approach works in practice.
Engaging to make a difference
As a long-term investor and representative of asset owners – our Partner Funds – we are committed to being active stewards of the companies in which we invest, regardless of asset class, whether this be traditional listed equity and fixed income or private markets assets.
Click below to find out more.
-
As an active investor, we embed responsible investment at the heart of our analysis and investment decision-making process for all assets. We have an in-house Responsible Investment team which acts as our centre of expertise, providing research and support to mitigate and manage material environmental, social, and governance risks.
We are a long-term investor and representative of asset owners and hold companies and asset managers to account regarding environmental, social and governance issues, including climate
change factors, that have the potential to impact corporate value.We believe that engagement is a vital component of active stewardship. Meeting and engaging with companies are integral to the investment process. As part of our stewardship duties, we monitor investee companies on an ongoing basis and act if investment returns are at risk.
-
Environmental, social, and governance (ESG) factors tend to be longer term in nature and can pose real material financial risks to an investment, but can also create opportunities. It is therefore important that, as a long-term investor, we take them into account when analysing potential investments. The factors considered are those which could cause financial and reputational risk, ultimately resulting in a reduction in corporate and shareholder value.
-
Our engagement strategy includes several different strands to engaging with our investee companies:
- Our internal portfolio managers and specialist Responsible Investment team engage directly with companies within our portfolios.
- Our appointed external managers engage with companies on our behalf and provide details as part of their reporting cycles.
- We work in partnership with Robeco, our voting and engagement partner, who engage with companies we own globally across several ESG themes on our behalf. This allows us to better fulfil our stewardship objectives as an active shareholder in overseas markets.
- As a member of LAPFF we have added our voice to an influential group of local authority pension funds and pools, to maximise our influence as shareholders.
- We collaborate with like-minded investors and bodies to create a stronger voice on ESG issues.
-
We have pledged to achieve net zero greenhouse gas emissions across our investment portfolios by 2050 or sooner and are a member of the Net Zero Asset Managers’ Initiative.
Climate change is an existential threat to societies across the world – doing nothing is not an option. Representing asset owners with c.£60bn of assets (at 31 March 2023), we have a key role in not just managing the impact of climate change on our portfolios, but also in supporting the investment needed to transition to a low carbon future.
Our roadmap to achieving net zero has now been published.
For more information on how we will turn our ambition into reality, access our full Net Zero Implementation Plan at the top of this page.
-
Being an active steward and using our voice on company votes is a key part of our engagement work at Border to Coast. We continue to evolve and strengthen our approach to ensure we remain an effective long-term, responsible investor on behalf of our Partner Funds. For 2025, we have strengthened our approach to climate voting by incorporating the interconnected issue of deforestation.
Firstly, we have introduced a presumption to vote in favour of shareholder proposals that ask companies to mitigate deforestation risks. This is in line with the presumption we already have in place to vote in favour of shareholder proposals that are aligned with the objectives of the Paris Climate Agreement.
Second, for companies with exposure to high deforestation-risk commodities such as palm oil, soy, beef, timber, paper and pulp, we will vote against the re-election of the Chair of the Sustainability Committee at their Annual General Meetings if a company is assessed as failing to mitigate risk through adequate policies and processes or judged to be involved in severe deforestation-linked controversies.
-
We believe in the power of engagement rather than divestment as we believe that constructive dialogue with companies in which we invest is more effective than excluding companies from the investment universe.
Our investment approach is not to divest or exclude entire sectors, however there may be specific instances when we will look to sell or not invest in some industries or companies based on investment criteria, the investment time horizon, and if there is limited scope for successful engagement – particularly in areas where we have escalated our engagement with a company but still see no changes implemented.
Using these criteria and due to the potential for stranded assets, we will not invest in public market companies or illiquid assets where more than 25% of revenues is derived from thermal coal and oil sands.
We will exclude public market companies in developed markets with over 50% revenue derived from thermal coal power generation. For companies in emerging markets, this exclusion applies to public market companies deriving over 70% revenue from thermal coal power generation. This reflects our support of a just transition towards a low-carbon economy which should be inclusive and acknowledge existing global disparities.
In addition, we will not invest in companies contravening the Anti-Personnel Landmines Treaty (1997), Chemical Weapons Convention (1997), the Biological Weapons Convention (1975), and the Convention on Cluster Munitions (2008). This means we do not invest in:
- Companies where there is evidence of manufacturing such whole weapons systems.
- Companies manufacturing components that were developed or are significantly modified for exclusive use of such weapons
-
Our extensive work implementing responsible investment is outlined in our Responsible Investment Policy, Climate Change Policy, and Corporate Governance and Voting Guidelines, all of which are available in our document library. We also proactively publish an annual report on our stewardship and engagement activity every year.
For further detail on our activity, we publish a number of Responsible Investment Reports:
- Quarterly Stewardship Reports
- Robeco Active Ownership Reports
- Quarterly Voting Reports
- TCFD Reports
All of these documents can be found in the Responsible Investment Reports section of our document library.
Collaborations
Collaboration is key to maximising our influence on behalf of our Partner Funds and we do so by working with a range of like-minded institutional investors and organisations such as LAPFF, Climate Action 100+, the Workforce Disclosure Initiative, and the 30% Club.
