The National Association of Pension Funds (NAPF) is launching a programme of Stewardship Accountability Forums to offer pension funds of all sizes the opportunity to quiz asset managers on their stewardship activities on behalf of pension savers.
The first forum takes place on 24 November 2014 at the NAPF’s offices in central London. Chief executives and senior representatives from Aviva Investors, Legal and General Investment Management (LGIM) and UBS Global Asset Management – with a combined total of GBP1 trillion assets under management (AUM) – will participate in the first event. Pension funds are encouraged to attend to question these senior individuals on their organisations’ stewardship activities.
Stewardship activity aims to promote the long-term success of companies in such a way that the ultimate providers of capital – in this instance long-term investors like pension funds – also prosper. These forums build on the NAPF’s Stewardship Disclosure Framework and its aims to provide greater transparency on the stewardship policies and activities of asset managers who are signatories to the UK Stewardship Code.
According to the NAPF’s annual Engagement Survey 20132, 96 per cent of pension funds recognise they have stewardship responsibilities, which include engaging with companies and voting. And research among consumers by the NAPF found that 60 per cent of scheme members would like their employer to favour pension providers with a convincing and long-term approach to stewardship of their investments.
Will Pomroy, policy lead: stewardship and corporate governance, NAPF, says: “As NAPF research has shown there is a strong latent interest amongst pension savers for pension funds taking an active interest in the long-term interest of the companies in which they invest. And with an additional six to nine million people saving into a pension in the next few years due to automatic enrolment the importance of good stewardship has never been greater.
“These new Stewardship Accountability Forums are an opportunity for pension funds to press some of the most senior figures in the asset management industry on their organisations’ stewardship activities and whether what they say matches what they do in practice.
“Pension funds of all sizes are welcome to come along to these sessions. We are particularly keen to encourage pension fund trustees who might not usually have access to these asset managers to attend and raise questions on behalf of their members.”
Vince Cable MP, Secretary of State for Business, Innovation and Skills, says: “This is a valuable step in developing good practice in the investment and pensions industry, building on the Stewardship Code. I welcome the NAPF’s latest plans, which should help improve dialogue between asset managers and their clients on stewardship activity. I would encourage asset managers who have not done so already to consider disclosing against the Framework, and hope that pension funds will use the planned meetings to quiz their asset managers closely about their approach to stewardship.”