The Local Authority Pension Fund Forum in the UK is to increase pressure on FTSE 100 companies in which its members are major shareholders to improve their corporate responsibility and governance.
LAPFF - which represents 25 local authority pension fund members with around £35 billion in combined assets - is to focus its 2001 shareholder engagement campaigns on:
* Overseas labour standards focussing on retail companies with no policies on improving overseas labour standards among their subsidiaries and supply chains.
* Promoting environmental reporting focussing on companies it has identifies which do not currently report on environmental issues. The forum will be targeting these companies for further action including meetings and possible AGM attendance. It will also be looking at climate change issues and encouraging reporting of carbon emissions among larger companies.
* Encouraging tougher performance targets for directors’ share schemes. The forum has agreed to a co-ordinated voting strategy aimed at new share option schemes with real earnings per share growth of 3% per annum or less.
The forum will also be undertaking a comparative analysis of codes of conduct adopted by FTSE 100 retailers to assess their content, scope, implementation mechanisms and how they are being monitored.
LAPFF chairman Bob Sowman said the forum is committed to using its influence as significant shareholders to raise standards of corporate responsibility and governance.Sowman - who is the £5bn West Yorkshire Pension Fund - said: “We believe that greater accountability to stakeholders will ultimately improve company performance and shareholder returns. The issues we have identified are important for companies to get right and for shareholders.”
Sowman added: ”The LAPFF has a good track record of success in engaging in responsible dialogue with companies to achieve change for the better. Our strategy of identifying companies which are lagging behind best practice and then using our collective influence is both responsible and effective. We look forward to further progress on these campaigns in 2001.”
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