The Australian Council of Superannuation Investors (ACSI) has launched the country’s first stewardship code for asset owners.
The 14-page Australian Asset Owner Stewardship Code was unveiled today and looks at voting, corporate engagement, monitoring asset managers and “financial system advocacy”.
Signatories must commit to publishing a Stewardship Statement, which describes, on a ‘comply or explain’ basis, how it applies the following six principles:
1. Publicly disclose how they approach their stewardship responsibilities
2. Publicly disclose their policy for voting at company meetings and voting activity
3. Engage with companies either directly, indirectly (for example, via collective action or third-party providers) or both
4. Monitor asset managers’ stewardship activities
5. Encourage better alignment of the operation of the financial system and regulatory policy with the financial interests of long-term investors
6. Report to beneficiaries about their stewardship activities.Seeking to “raise the bar on signatories to proactively manage and disclose their stewardship activities”, the code was developed in consultation with ACSI members and other market players. AustralianSuper and HESTA are reportedly the two founding signatories.
“There is a growing desire for information about how asset owners manage the money entrusted to them,” explained ACSI’s CEO, Louise Davidson, adding: “Beneficiaries and other stakeholders will find it easier to understand and assess the focus that asset owners have on good stewardship” using the code.
She described the code as a way for asset owners to demonstrate that their “intentions are backed by meaningful action”. “This is a strong basis from which to build trust and to set the tone for stewardship in Australia.”
RI Europe 2018 will include the session Stewardship Codes: Are they working, how useful have they been and where can we see their output in investment strategies? For more details, see here