First non-domestic pension fund signs up to UK Stewardship Code

The C$107.5bn (€77.5bn) Ontario Teachers’ Pension Plan, the largest single-profession pension fund in Canada, has become the first non-domestic asset owner to disclose that it has formally signed up to the UK’s Stewardship Code.

It joins the 24 domestic asset owners who have issued statements so far. Getting international investors to back the Code has been a priority of the Financial reporting Council, the watchdog which oversees the code.

The code, introduced last year, has received supportive letters from international institutional investors such as Sweden’s AP3 and CalPERS – although other institutions such as the Norwegian Government Pension Fund have expressed misgivings about the initiative.

The OTPP points out that it is not compelled by the UK’s Financial Reporting Council watchdog to a report on stewardship.“However, we believe we have no greater role than to be good stewards of the retirement funds of our plan members, the elementary and secondary teachers of Ontario.

“As such, it is both logical and appropriate that we communicate how we go about fulfilling our stewardship responsibilities.”

The fund, known as Teachers, says it has never shied away from initiating or participating in public debate. “When we do speak publicly it is to protect the rights of shareholders, to curb what we consider to be value-destroying egregious practices or to comment on current emerging issues that could influence the long-term returns of the portfolio and in turn the interests of our members.”

Earlier this month, EFAMA, the European Fund and Asset management Association, put forward a six-point voluntary code covering the exercise of investors’ ownership rights in companies – in effect a pan-European version of the UK’s Stewardship Code.