Responsible Investment is the term Henderson uses to cover its work on corporate governance and corporate responsibility (or social, environmental and ethical issues) in the companies in which we invest on clients' behalf, across all our funds. Together these are sometimes referred to as 'environmental, social and governance' issues (ESG).
Our Responsible Investment work enables us to help UK pension funds fulfil the requirement under the Pensions Act to include a policy on social, environmental and ethical issues, and on voting, in their Statement of Investment Principles.
In addition to this Responsible Investment work, Henderson provides a range of specialist Sustainable and Responsible Investment (SRI) funds. Visit the SRI Funds website.
Corporate governance
Good corporate governance is fundamental to ensuring that companies are well managed, deliver long-term returns to their shareholders and are accountable to them, and take account of their wider responsibilities to society. Board structures need to ensure that no one person is able to exercise undue influence and power and that key areas such as audit, executive remuneration and nominations to the board receive appropriate attention. Non-executive directors with appropriate skills, backgrounds and independence should both contribute to the company's strategy and monitor the performance of executive management. Policy on executive remuneration should be clearly articulated, and rewards clearly linked to demanding levels of performance.
Corporate responsibility
Henderson also believes that good management of a range of responsibilities towards different stakeholders contributes to business success and long-term shareholder value. This embraces:
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economic responsibilities to shareholders and to behave fairly and legally in the marketplace, towards consumers, suppliers and competitors
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responsibilities to minimise and manage environmental impacts
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responsibilities towards employees
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responsibilities to the wider community.
We expect all the companies we invest in to have a code of conduct and policies based wherever possible on recognised international standards in these areas, and to include information on their performance in their Annual Report and separate specialist reporting. We encourage companies to follow the guidelines of the Global Reporting Initiative.
Henderson policy
Henderson's Responsible Investment Policy sets out our approach to corporate governance and corporate responsibility for all the companies in which we invest, and our policy on proxy voting. The Policy also sets out how Henderson implements the UK Institutional Shareholders' Committee's Statement of Principles on the Responsibilities of Institutional Shareholders and Agents.
For further information on our responsible investment work, please contact Antony Marsden, Corporate Governance Manager, antony.marsden@henderson.com