Engagement

Simply investing in companies is not all that investors can do to affect the behavior and performance of those companies.  More and more investors, such as pension funds, are meeting directly with companies either at their annual general meeting or in private meetings in order to advocate for specific type of corporate changes. This interaction is often called “engagement” and has become a quite powerful tool for investors to influence companies. Recent shareholder votes regarding executive compensation is simply one example.

By using the ASSET4 data users can define specific topics (e.g., compliance criteria) in order to monitor and interact with companies based on that criteria. For example users could evaluate their portfolio in regard to the percentage of women in management and/or the amount of product innovation going toward addressing climate change. Once the investor has identified the leaders and laggards then can create a communication and advocacy plan, which if they are a large investor or part of an organisation can have a direct affect on the companies.