Active Ownership – your money has a voice
Policy statement for Octopus Money Unit Trust Managers Limited, covering active ownership and shareholder engagement
Our Active Ownership Policy and Responsible Investing Policy establishes our investment approach to integrating financially material Environmental, Social and Governance (ESG) risks and opportunities into stewardship activities and investment decision making .
Remember – ESG investing includes considering important Environmental (the planet), Social (people) and Governance (how companies are run) factors as the companies we invest in are both dependent on and will be affected by these things in making profit.
Our Active Ownership approach
Our approach to active ownership is aligned with our investment beliefs. This approach recognises the importance of active ownership as our voice as investors and as one of the most effective mechanisms in responsible investing.
As investors the rights of ownership provide the opportunity to influence the companies we invest in. Owning shares means being a shareholder, so you can engage and vote on important issues which can relate to sustainability (people and the planet) or governance (how companies are being run). Investing in other investments such as bonds provides the right to engage with companies on these issues.
As responsible investors we aim to remain broadly invested across different types of companies, industries and regions. Being an active owner is important because there are issues such as climate change, biodiversity loss and human rights which affect the entire economic system and can not be diversified. Investors can work together to influence companies, policy makers and governments towards better management of these issues and investing in a way that supports building a more sustainable world for the future.
Our approach reflects the opportunities we have to influence through stewardship activities (as stewards looking to provide the best long-term financial outcome for investors) such as engagement, voting and advocacy. We work with expert partners, Aberdeen as our Investment Adviser who manage our funds aligned to our responsible investing approach. Aberdeen carry out stewardship activities on our behalf for our directly invested funds (Octopus UK Index Tracker, Octopus Climate Change Fund and Octopus Bond Fund) and for Aberdeen funds invested in by our funds of funds (Octopus Defensive Fund, Octopus Global Fund, Octopus Growth Fund 1, Octopus Growth Fund 2 and Octopus Growth Fund 3). Our funds of funds also invest in other Investment Manager funds, who carry out stewardship activities on our behalf. It is important that we have oversight of both Aberdeen and other Investment Managers to ensure that they are using our rights of ownership aligned to our policies and guidelines.
As a signatory of the United Nations (UN) Principles for Responsible Investment (PRI) we support the aims of the UN PRI to promote long-term financial performance as dependent on healthy economic, social and environmental systems in which companies operate. The UN PRI promotes working on collective goals and the delivery of positive real-world outcomes through enhanced collaboration among investors.
Our responsible investing policy provides commitment as an investment manger, to integrate financially material ESG risks and opportunities into investment decisions and active ownership.
Active Ownership Policy
Our Active Ownership Policy provides the commitment to build our capacity as stewards of the investments we manage on behalf of our investors.
We work with Aberdeen as our Investment Adviser and other Fund Managers on how they manage our funds in line with our policy framework and guidance, ensuring we can leverage investor influence and support collaborative investor efforts in support of a sustainable future.
Our policy focuses on:
Priority Sustainability and Governance Issues
As an active owner we consider the most financially important sustainability and governance issues as an agenda for investor effort and oversight of stewardship activities
Ensure delegated engagement activities align to our active ownership approach and material issues. Use collaborative engagement and policy advocacy to influence systemic and material issues.
Ensure delegated voting activities align to our active ownership approach and material issues.
Other Important Activities
- Investor Communications – ensure a clear understanding of our active ownership approach.
- Regulatory Compliance – comply with FCA rules on voting and engagement including disclosure requirements for stewardship activities.
- Conflicts of interest – ensure conflicts of interest are managed across stewardship activities.
- Stock lending – ensure any stock lending agreements align to effective stewardship and influence as an active owner.
A few more important things
There are a few other areas of active ownership that are considered and these help us to manage your investments.
Conflicts of interest based on ownership influence
That means keeping an eye out for things that we and other Fund Managers do that might stop us from making the most of this on your behalf.
Sweating the big stuff
Our Investment Adviser Aberdeen and other Fund Managers work with other investors on the big things that companies need to do to build towards positive change and a brighter future.
Lending out
A couple of our funds can lend out their investments, which also includes ownership rights. We make sure this is only in small amounts, for a short time.