Responsible investment isn’t just the right thing to do, it makes sound financial sense.
As a long‑term investor, we’re convinced our investments will be more successful if we understand how the companies and projects we invest in perform on issues like board diversity, governance, climate change and regulatory developments.
Our insight into environmental, social and governance (ESG) issues and trends help us understand the risks that could hit our investments and spot investment opportunities.
Supported by the Global Responsible Investment team, our analysts and portfolio managers integrate these issues into the investment analysis and decision-making process across all our asset classes.
A company-wide commitment
A big part of integrating ESG into our investment decisions is making sure that it is embedded across the investment process. Two ways of doing this is our Responsible Investment Officer Network and the integration of ESG into the way investment team members are remunerated.
ESG and alternative assets
Responsible Investment and ESG have traditionally been biased towards liquid assets such as equities and bonds. There are several reasons for this, including the weight of assets under management, availability of information, and the rights and access provided to shareholders.
The ESG layers – from the macro view to a company profile
At Aviva Investors, we integrate ESG issues across the investment process: from the macro view to a company profile, and from how we see the world to how we view a sovereign, a sector or a company.
At its simplest, stewardship means taking responsibility for something entrusted into our care. To us, it means monitoring, engaging, and, where appropriate, intervening, on matters than can have a material impact on the long-term value of our investments - matters such as board diversity, human rights abuses and greenhouse gas emissions, for example.
We consider active stewardship to be a fundamental responsibility as investors. In 2018, we engaged with 1,954 companies, voted on 54,335 resolutions at 4,713 shareholder meetings and worked alongside other investors and civil society organisations.
Voting with conviction
We consider voting to be an important part of the investment process and have had a formal and considered voting policy since 1994. We have explicitly incorporated corporate responsibility disclosure and performance into our voting since 2001 – being one of the first asset managers to do so globally.
Power in numbers
Nearly a third of all natural World Heritage sites are subject to extractive activity, despite protection from the UNESCO World Heritage Convention. Following a number of successful engagements on this topic, including SOCO International and BP, we helped to launch a collaborative project to call on extractive companies to make ‘no go’ commitments in World Heritage sites.
Superbugs – on the frontiers of sustainability
The issues related to antimicrobial resistance and spread of drug-resistant 'superbugs' pose serious risks to public health and the business landscape. We have engaged with our investees to discuss their strategy on antibiotic resistance.
The value of an investment and any income from it can go down as well as up. Investors may not get back the original amount invested.