The Financial Conduct Authority (FCA) has instructed its Vote Reporting Group to consult on building an industry consensus on a voluntary vote-reporting template for asset managers in the UK.
The group is proposing a “voluntary, standardised and comprehensive vote-reporting template” for asset managers to communicate about their voting activity to asset owner clients.
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The objectives are to provide asset owners with more consistent, up-to-date and comparable data, for timely and accurate decision making and to increase reporting efficiency for asset managers.
Chair of the Vote Reporting group Deborah Gilshan said in the consultation report: “Voting matters. It provides important accountability mechanisms for investors to support
and challenge the companies they invest in…[and] in the relationship between asset owners and asset managers, enabling asset owners to choose asset managers whose stewardship beliefs align with their own. Voting becomes even more powerful when better transparency is provided around the reasons for vote decisions.
“In my view, the full value of voting is not currently realised across the investment chain. This value can be unlocked through better disclosure by investors about how and why they vote.”
The report added all parts of the investment chain “need to be nudging and challenging each other, to ensure full accountability for claims made to deliver long-term, sustainable value”.
Members and contributors
Consultation input is sought from asset managers; asset owners; public companies; consumers and representative bodies; industry groups and trade bodies; investment consultants; non-governmental organisations (NGOs); other service providers; proxy advisers; and regulatory bodies and policymakers.
The FCA established the Vote Reporting Group as an independent working group in November 2022.
It has 31 members, from investment managers, pension funds, insurers, investment consultants, proxy advisers and NGOs, including the UK Sustainable Investment and Finance Association, Principles for Responsible Investment, BlackRock, the Investment Association and the Local Authority Pension Fund Forum. The chair is Deborah Gilshan, founder of the 100% Club.
The consultation closes on 21 September.
