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RLAM

Stewardship and responsible investment report

Our approach to stewardship and responsible investment - engagement, research, voting and how ESG was applied to our investment decisions in 2024.

Download our 2024 report

"We recognise that different clients have different priorities – which means transparency is a key element of our approach."

Ashley Hamilton-Claxton
Head of Reponsible Investment

As responsible investors and trusted stewards of our clients’ capital, we actively promote strong governance and forward-thinking across our assets. 

Our responsible investment and stewardship activities always aim to be pragmatic, reflective of local best practice and evolving market insights, and focus on the long-term interests of our clients. 

The actions the Responsible Investment team takes may not always apply to a specific fund or strategy. Each of our funds and strategies have their own investment objective and will make investment decisions according to that. Portfolio holdings and characteristics should not be considered a recommendation to buy or sell. Please check the prospectus for details on specific fund-level objectives. 

2024 highlights

Stewardship activities

We focus our time and attention on issues we feel are most material to our investments, and where we think engagement can have the biggest impact on ESG outcomes.  

We do this by focusing on six key engagement themes. These are chosen following a review of trends and events, alongside extensive consultation with fund managers, responsible investment analysts, clients and other stakeholders.

The physical impacts of extreme weather – and the policies and infrastructure change we need to reduce emissions – are disrupting financial markets, our physical environment and ‘business as usual’. We focus our stewardship efforts on encouraging business transformation that supports the goals of the Paris Agreement and a net zero emissions future, while building resilience to the physical risks of climate change. 

Highlights

  • 54% of entity-level financed emissions meaningfully engaged with 
  • 38 detailed Climate Transition Assessments of companies undertaken
  • 12 companies with net positive improvements to their transition plans 
263

Engagements* on climate

192

Engagements* on climate

Climate change engagements

Climate engagements

* number of engagements is often higher than number of companies engaged as multiple issues could be discussed with one company in the same meeting.

Company case study

To address social inclusion, we are helping to shape a just transition, asking companies to promote economic equality and protect the vulnerable as they work towards a lower-carbon future. Complementing this is a newer focus on ‘just adaptation’ so that companies’ climate resilience efforts consider the impacts on stakeholders. On the topic of financial inclusion, we also engaged with microfinance providers to encourage responsible lending and shape best practice. 

Highlights

  • Engaged to ensure inclusion is integrated into climate transition strategies
  • Introduced more rigour around companies’ just adaptation plans 
  • Established best practice guidelines for microfinance providers.
58

Engagements*

42

Companies contacted

Social and financial inclusion engagements

Social and financial inclusion engagements

* number of engagements is often higher than number of companies engaged as multiple issues could be discussed with one company in the same meeting.

Votes

Assessing human health risks and impacts can help make informed investment decisions that can support both financial returns and societal wellbeing. We expect our investee companies to promote and support the wellbeing of employees, customers and communities. We also encourage greater transparency, acknowledging in many cases it can be very difficult to measure a company’s contribution to improved human health.

Highlights

  • Engagement with wastewater companies to address antimicrobial resistance risk (AMR)
  • Continued engagement under the CCLA Corporate Mental Health Benchmark
  • Led collaborative engagement with Roche as part of the Access to Medicines Index
221

Engagements*

211

Companies contacted

Health engagements

Health engagements

 

 

 

 

 

 

 

* number of engagements is often higher than number of companies engaged as multiple issues could be discussed with one company in the same meeting.

AMR case study

Artificial intelligence (AI), data privacy, censorship and the ever-increasing growth of technology are issues we expect companies to scrutinise and plan for. In a rapidly evolving digital world, we support several initiatives to strengthen cyber resilience and the ethical application of technology in the companies we invest in.

Highlights

  • Started engagement on sustainable and ethical AI
  • Joined the World Benchmarking Alliance collaborative engagement on ethical AI
  • Continued collaboration on cyber security with published guidance for asset owners and asset managers
29

Engagements*

20

Companies contacted

Innovation, technology and society engagements

Innovation, technology and society engagements

 

 

 

 

 

 

 

* number of engagements is often higher than number of companies engaged as multiple issues could be discussed with one company in the same meeting.

Cyber case study

We believe good governance, a healthy corporate culture and a diverse workforce create resilient businesses and support inclusive decision making. We expect companies to have strong boards, appropriate pay structures, and robust audit and accounting procedures.

Highlights

  • Engagement with Vistry
  • Improving workforce engagement
  • Remuneration voting and UK competitiveness
226

Engagements*

143

Companies contacted

Governance and corporate culture engagements

Governance and corporate culture engagements

 

 

 

 

 

 

 

* number of engagements is often higher than number of companies engaged as multiple issues could be discussed with one company in the same meeting.

Vistry case study

We aim to understand the impact of our investment decisions on biodiversity and the associated dependencies, risks and opportunities. We have started to engage with companies to improve their stewardship of nature, encouraging them to enhance their knowledge, management and disclosures to protect our environment.

Highlights

  • Created a nature and biodiversity analysis tool
  • Engaged with two companies as part of Nature Action 100
  • Engaged with water companies on biodiversity
25

Engagements*

16

Companies contacted

Biodiversity engagements

Biodiversity engagements

 

 

 

 

 

 

 

* number of engagements is often higher than number of companies engaged as multiple issues could be discussed with one company in the same meeting.

Tools and data

Investment actions

We believe that well-managed companies make better investments. For over two decades, we have been pioneering our approach, integrating ESG criteria into traditional financial analysis and assessing how these may affect investment performance. This was long before it became mainstream in asset management.

Select the asset classes below to read more about our 2024 investment actions in this year’s report. 

Documents

Reports

Policies

Climate reports

Sustainable funds outcomes reports

Latest responsible investing views

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