A new report from Squarewell Partners’ new platform AQTION (complimentary download here) provides noteworthy data on the 65 largest institutional investors’ (listed in the Appendix) ESG stewardship practices.
Among the key takeaways:
Proxy advisors
· ISS serves as the “primary” proxy advisor to 51 of the 65 investors, while Glass Lewis serves as primary to eight. However, several investors use both to help inform their proxy voting decision-making.
· The forgoing nws, a plurality of investors exhibit a low level of reliance on the proxy advisors’ recommendations and most have proprietary voting policies.
ESG raters/ratings
Investors predominantly use MSCI, Sustainalytics, Bloomberg ESG, and ISS-ESG ratings providers. Just 14 investors don’t use or disclose which ESG Ratings and Research providers they use.
Several investors (e.g., State Street) also have their own proprietary ESG ratings.
Disclosure frameworks
The TCFD is the most widely supported framework, as shown here:
The report also includes data on the presence of an express voting policy or policy position on combined CEO-Chair roles, ESG-linked pay, board ESG oversight, and other select topics, along with examples of the foregoing, as well as additional benchmarking data.
See “Exclusive: The ESG and executive pay issue dividing the world’s largest investors” (IR Magazine) and additional resources on our Institutional Investors page.