Our approach to voting adopts best-practice corporate governance and ties in with our wider stewardship priorities to reflect our clients’ values. We take a strong position on excessive and poorly aligned executive remuneration proposals, gender diversity in company leadership and environmental sustainability.
As part of our active ownership programme, we aim to vote at all public meetings held by our investee companies. In the year to June 2023, we voted on 3,092 resolutions at 196 company meetings.
To increase the impact of our votes we write to all companies prior to the meeting about our plans. We place particular focus on any resolution where we do not propose to support management and provide an overview of our concerns.
To air our dissenting voice, we use our votes when relevant directors are due to be re-elected. For instance, we vote against the chair of the remuneration committee where we have concerns about executive pay plans, the chair of the nomination committee if the company has a poor approach to gender diversity, and the chair if the business is not adequately addressing climate-related risk.
Our voting activity is managed by Institutional Shareholder Services. However, we use a bespoke template which led us to oppose nearly five times as many management proposals as the standard ISS template. The records below illustrate the impact of our template (data for the year to 30 June 2023).
Voting pre-disclosures
Nestlé - AGM on 18 April 2024
Item 7: Shareholder proposal for an amendment to the Articles of Association regarding sales of healthier and less healthy foods
Our vote intention: FOR
Management Recommendation: AGAINST
Summary: The company falls short of our expectations to use internationally accepted standards when assessing the health implications of its products and setting targets for increasing sales of healthier food.
Background: Good nutrition is fundamental to good health, yet humankind is facing a growing epidemic of diet-related ill-health. We support ShareAction’s Healthy Markets Initiative and the Access to Nutrition Index. Through this collaborative engagement we are asking Nestlé, and other companies, to commit to producing healthier products and to make these products more accessible, more affordable and more available.
By engaging with companies on nutrition we can make business models more resilient and play a role in improving public health.
Engagement to date: Over the last few years of engagement, we recognise the progress that Nestlé has made, particularly having agreed to set a sales-based target to increase sales of healthy products despite initially stating it was too early to do so.
However, while this is a step in the right direction, we are disappointed that the target is absolute and not proportional. Furthermore, some products that Nestlé classes as ‘nutritious’ for the purpose of the target (such as coffee) are typically not included in internationally accepted nutrition standards such as the Health Star Rating. Item 7 at the Nestlé AGM addresses these concerns.
Our end goal: For Nestlé to set a proportional target for sales of healthier products using government endorsed nutrient profiling models.
