What is stewardship and how can it make a difference?


What is stewardship and how can it make a difference?

Stewardship is critical to how we and our asset managers deliver sustainable value for our stakeholders and make a difference to society.

Gettyimages 1371098124 Rendition Web

Stewardship is a word you’ll see often in our content. But we realise it’s not always fully understood, and we’d like to change that.

What is stewardship?

When we use the term stewardship we’re talking about our responsibility to manage environmental, social, and governance (ESG) factors in our investments and creating value through dialogue with the companies in our portfolios.

At Phoenix Group, we have the size and scale to drive meaningful change and influence corporate behaviour. A key way we aim to deliver this is through our sustainable investment and stewardship activity.

What does stewardship look like?

There are major challenges facing society today that our customers and shareholders quite rightly expect us to act on. We do this via engagement with the companies we invest in and by using our shareholder voting rights.

  • Engagement is when we work with companies to embed best practice and drive real-world change. We do this through our asset managers, our in-house stewardship team and in collaboration with other investors to increase our power of influence.
  • When it comes to voting, as a customer or investor in our funds, you can't vote directly with the companies in your portfolio. This responsibility lies with the investment managers we partner with, to vote on our members' behalf, to approve or reject boards' decisions and/or other shareholders' proposals. Our team monitors closely how this is done in alignment with our philosophy and principles on responsible investment.

What’s the Phoenix Group approach to stewardship?

We’re committed to focusing on the big issues, to safeguarding the interests of our customers and shareholders, and creating a better future for all our stakeholders. That’s why our approach to stewardship covers four main areas:

  • Climate change: Climate change presents both risks and opportunities for the companies we invest in.
  • Human rights: We believe that the responsibility to respect human rights applies to all companies.
  • Nature: We recognise the need for companies to protect and restore the planet’s natural resources.
  • Controversies linked to the United Nations Global Compact (UNGC) breaches: We expect companies to adhere to international standards on human rights, labour rights, environmental issues and anti-bribery and corruption efforts.

Stewardship and the journey to net zero

As a large asset owner, we are committed to help tackle climate change by using our ‘seat at the table’ in the companies we invest in, while keeping our customers best interests at the heart of what we do. This is why stewardship is central to our ambitious Net Zero Transition Plan, setting out how we aim to  become a net zero business by 2050.

Our direct engagement focuses on 25 priority companies, which account for 40% of our financed emissions in highly emitting sectors. We have developed a climate change scorecard which we use to support and monitor their transition to net zero.

How does Phoenix Group report on stewardship activity?

You can expect to see regular stewardship updates on this website and in our annual stewardship report.