UK/NETHERLANDS - The e14bn Bedrijfstakpensioenfonds Metalektro (PME) has hired ISIS Asset Management to manage a share voting programme and a governance and socially responsible investment engagement overlay.
ISIS will not be managing any of the fund’s assets but will apply its reo (Responsible Engagement Overlay) programme to PME's equity portfolio over and above the share voting service.
The reo approach engages with companies and encourages them to address social, environmental and governance risks, rather than screening them from the investable index. Roland van den Brink (pictured), managing director investments of PME said: Pension schemes are significant shareholders and cannot act as absentee landlords. The Netherlands has one of the most developed pension fund industries in Europe, and as such should be pioneering a robust approach to governance and SRI.
“Voting was up until now delegated to our external asset managers, but there was no coherence in policy and subsequent reporting. We chose the ISIS reo service as it complements rather than impedes our fund management activities.”
He added: “It enables us to be active and responsible shareholders with a clear and coherent strategy towards companies across all of our funds. It was also evident to us that ISIS had the resources and expertise necessary to undertake this work. In addition, ISIS has the capacity to publish our full voting record, and we feel that transparency to our own members in this way is important going forward.
Michel Bernard, director, institutional funds at ISIS Asset Management said: We are delighted that PM has chosen to use our overlay approach, reo. We believe that reo is a sound proposition for pension funds, providing them with a long-term engagement solution on governance, environmental and social issues. Our philosophy is based on a constructive shareholder dialogue promoting good practice and performance.
Bernard added: We find that Continental European funds are showing increasing interest in our approach to governance and engagement. This reflects the growing belief that governance and SRI are specialist functions which require an experienced and well-resources team, and so are ideal for out-sourcing.
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