The key highlights from the report include:
- 2020 voting statistics: Railpen voted at 2,166 meetings in 2020, which is 99.7% of the total number of meetings attended; Railpen voted against, withheld, or abstained on at least one occasion in 63.2% of those meetings. Railpen’s voting policy for 2021-22, published in February 2021, includes new focus on topics including treatment of the workforce during Covid-19 and beyond, and climate accounting. Full details can be found here.
- Influencing the policy debate: The Railpen team contributes to the public policy debate when doing so has the potential to shape the regulatory framework in a way which supports sustainable investment and stewardship. In 2020, public policy work focused on important debates such as The UK Listings Review and Mandatory climate risk reporting by pension schemes. Full Railpen policy submissions can be found here.
- Responding to the Covid-19 pandemic: In every engagement from March 2020, Railpen probed portfolio companies on their response to Covid-19 and the current and likely future impact on their people and operations. Railpen used the intelligence from these engagements to help shape its Spring 2021 public commitment to vote against companies where it does not believe that there has been fair treatment of workers, customers and suppliers or a genuine commitment to delivering such treatment in the future.
- Climate engagement successes: By engaging with investee companies, both individually and collaboratively, in 2020 Railpen drove greater alignment of the investment industry with the Paris Agreement and support for the UK government’s climate commitment. Railpen built on this work in 2021 to work with Carbon Tracker, the IIGCC and CA100+ on Paris-Aligned Accounts. This includes becoming lead investor on climate accounting with two companies and engaging with firms to ensure better disclosure of the climate assumptions used in their financial accounts.
Caroline Escott, Senior Investment Manager at Railpen, commented, “Our members are firmly at the heart of everything we do on stewardship. In 2020 we worked hard to prioritise engagements with those companies where we believed that doing so would have a material impact on protecting the value of members’ savings.
“We also used our voice to shape public policy debates on issues from minority shareholder rights to climate risk reporting by pension schemes, helping policymakers find system-level solutions to the system-level risks across our portfolio. Combined with our commitment to robustly wield our voting rights and vote against those companies whose behaviour failed to match our expectations on issues including board diversity and fair pay, we are proud of what we have achieved for members in 2020.
“We are not afraid to use our voting rights in a way that aligns with our engagements to publicly support or sanction a company’s behaviour, for example voting against Tesco’s remuneration report and pushing for more action from Total to achieve net-zero GHG emissions. Looking ahead to 2021, we will continue our efforts to engage with our portfolio companies in the best interests of our members.”
