Responsible stewardship is a fundamental part of our investment process. This is because we believe that we are most likely to deliver enduring value for our clients through the careful selection of investment targets, and the close monitoring of those companies we hold on our clients' behalf. Before we commit our clients' capital to a company, we undertake detailed due diligence guided by our thematic investment process.
Once our clients do become owners of a company, we stay very close the management. On occasion, we encounter unexpected risks, and where we believe we can play a helpful role to secure the company’s prospects, we will seek to do so.
We seek to act as partners with companies, supporting sound corporate governance and favouring management teams that welcome shareholder views. We also use our clients’ voting rights. We have clear voting policies based on principles that we believe should be universal and enduring, although we are willing to override them when we believe it is in clients’ best interests.
- A long-term mindset
- A constructive attitude
- Commitment to challenge disappointing behaviour
- We do not micro-manage
- We use our clients’ voting rights
- Our conversations with companies are generally confidential
- We will speak out publically where we believe it is necessary
- We liaise with other shareholders
- We do not seek to be ‘taken inside’
JPMorgan’s rejection of Paris alignment puts all our capital at risk
In early May, Barclays received overwhelming shareholder support for its proposal to put Paris-alignment into their Articles of Association. This marked a turning point in banks’ acceptance that their future success is intimately tied up with the planet’s continued stability.
Next week, JPMorgan’s shareholders will be similarly asked whether the bank should set out its plans to align with the Paris goals. Unlike Barclays, JPM’s board is arguing against such a commitment. We believe this response is ill-judged and short-sighted. The request by As you Sow is in all shareholders’ – and society’s – interests. It has our support.
The Board’s decision to reject the request raises broader questions over competence. Of particular concern is Lee Raymond’s role as Lead Independent Director – not only does his 33 years on the board mean he is no longer credibly independent, but his views questioning climate science are well documented. In our view, these factors mean we will vote against Lee Raymond’s reappointment.
Statement of support for Paris-alignment Shareholder Resolutions at Shell and Total SA
In light of the rising urgency of the climate crisis, Sarasin and Partners will be supporting shareholder resolutions requiring a Paris-alignment commitment at upcoming Annual General Meetings for both Royal Dutch Shell and Total SA. Critically, if passed, these commitments would go into each company’s Articles of Association, ensuring directors have an obligation to act. In recent weeks, both companies have published welcome ambitions to become net-zero businesses by 2050. On closer inspection, however, neither has set out how they will shift capital away from expanding fossil fuel production to the extent required by their ambitions. Until this happens, they will remain empty promises. Shareholders and the public deserve better.
Barclays climate resolution sends a powerful message to banks
Today, shareholders overwhelmingly voted in favour of adding Paris-alignment to Barclay’s Articles of Association. This means directors have an explicit duty to run their business in a way that contributes to bringing down carbon emissions to net zero by 2050. This represents a huge step forward for Barclays, for which the Board should be commended. It also offers a powerful model for others. All banks – indeed all companies – should be looking hard at whether they too should hardwire a Paris commitment into their governing statutes. This is not just the right thing to do for society, it is also vital to protect shareholder capital into the future.
Barclays’ resolution was triggered by a shareholder resolution, coordinated by ShareAction and co-filed by Sarasin, asking the bank to phase out financing for fossil fuels and utility companies that are not aligned with the Paris climate goals. While our resolution was not passed, almost a quarter of shareholders supported it (and a further 10% or so abstained – thereby declining to support the Board’s rejection). With over 20% support, Barclays will formally have to respond to its shareholders.
You can find the press statements from ShareAction here:
More infromation here
Shareholder resolution at Barclays puts climate crisis centre stage for 2020
As part of an initiative by ShareAction, we have joined a group of shareholders to ask Barclays Bank to phase out its financing of fossil fuel companies that are active agents in driving the climate crisis.
This resolution - the first climate change resolution filed at a European bank - also requests that Barclays consider the social dimension of the transition to a resilient and low-carbon economy, as per the Paris Agreement.
Natasha Landell-Mills commented:
"Aligning financial flows with the goal of keeping temperature increases well below 2C, and preferably to 1.5C, was hard-wired into the Paris Climate Agreement for good reason. Continued financing of harmful fossil fuel activities puts this target at risk, with potentially devastating consequences for us all. And yet, this is precisely what is happening today, and Barclays is amongst the most prolific bank financiers globally of such activities.
“It is therefore vital that Barclays’ Board ensures that it no longer supports - whether through direct lending or underwriting - any activities that run contrary to the Paris Agreement. Failure to act leaves directors open to charges that they have failed to meet their obligations under the UK Companies Act. It also exposes the bank and its shareholders to heightened capital risks as decarbonisation accelerates. At a time of economic uncertainty, the Board should not be taking on additional risks."
Read ShareAction's press release
An open letter to the Chair of Royal Dutch Shell
After a long engagement with Royal Dutch Shell, we wrote an open letter to the Chair in explaining our decision to sell our shares in the business for our clients following our Climate Active strategy. We also urged the Directors to rethink their capital deployment plans in order to demonstrably align with the goals of the Paris Agreement.
The letter was initially endorsed by the following clients: The University of Leeds; St Hugh's College, Oxford; Earthwatch Europe; The Actors' Children's Trust; The Congregation of the Passion of Jesus Christ; The Frank Jackson Foundation; The Royal College of Radiologists; Barrow Cadbury Trust; The Cameron Fund; Hackney Parochial Charities; Milton Keynes Parks Trust Limited; The Sisters of the Sacred Hearts of Jesus and Mary; and West Hackney Parochial Charity.
Since we sent it, the letter has been additionally endorsed by: BMA Charities; The Congregation of Jesus.
Read the letter