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Beyond screening and evaluating potential new investments, our stringent investment process also applies to existing portfolio companies. Stewardship takes place through a diverse range of engagement activities: direct, collaborative industry initiatives and advocacy.
Individually communicating with companies and issuers in our investment portfolios.
Working with industry peers for greater leverage and a unified voice, targeting portfolio companies and issuers (as well as some outside our portfolios) and critical themes for responsible investors.
Individually and collectively addressing systemic risks by influencing decisions within political, economic and social institutions.
The core aim of our stewardship is to encourage companies not only to improve on general governance best practice and operational profile, but also to seek a greater ambition to deliver social and environmental outcomes, drive innovation and become, or continue to be, an industry leader.
In order to ensure our active stewardship is focused, we refer to a series of themes that guide our priorities for engagement activities. These themes are segmented into core and secondary considerations.
ESG profile improvement
Animal welfare
Task Force on Climate-Related Financial Disclosures (TCFD) Reporting
Paris-aligned climate scenario roadmaps
Labour management
Controversial sourcing
Reconciliation Action Plan (RAP)
First Nations peoples’ rights (cultural heritage)
Gender diversity
Remuneration
Corporate behaviour
Community relations
responsible sourcing / de-materialisation
Gambling
We prioritise engagements with portfolio companies with the aim of improving general ESG performance. Our priorities are informed by investment decisions as well as based on thematic areas identified by the investment team.
The focus of engagement is on Australian equity holdings where U Ethical’s access to company management is greatest. A prioritised approach means that engagement does not cover all portfolio companies and issuers. The following steps are taken:
U Ethical has a history of advocacy to drive change with the aim of enhancing risk-adjusted investment returns. In cases where we cannot affect change as an individual investor, we encourage or join collaborative endeavours. U Ethical has historically played a strong advocacy role in influencing policymakers and political representatives within the commonwealth government through UCA’s JIM Cluster. The JIM Cluster meets regularly with policymakers and acts as expert witness in parliamentary inquiries. U Ethical provides varying degrees of support to the key thematic areas of JIM’s advocacy work including:
Protecting people on temporary visas from violence.
Climate justice action.
Online safety and curbing online child sex exploitation.
Online gambling advertising reform.
Actively exercising our proxy vote is an integral part of U Ethical’s stewardship and signals the intent of our ethical investment philosophy.
Before voting against a resolution at a company’s annual general meeting, we strive to speak or meet with the company’s management to raise our concerns.
When portfolio companies are involved in controversy cases of a certain severity, we also seek first to have a conversation with the company’s management and to follow up with formal correspondence and future meetings.
If engagement yields an unsatisfactory response, we will vote against at least one of the following (in descending order):
We are members of a range of industry bodies through which we collaborate and contribute, including:
Please find our Ethical investment and ESG reports on our forms and documents page.
As an ethical and responsible investor, we hold the companies in which we invest to high standards.
U Ethical’s investment approach includes building an ethical/ESG profile that identifies risks and opportunities and is completed prior to any investment.
The information provided is general information only. Before acquiring a U Ethical product, you should read the disclosure document(s) for the product and seek independent advice to ensure it is appropriate for your particular objectives, financial situation and needs.
The disclosure documents are available from this website and contain details of the issuer of each product. U Ethical is a registered business name of Uniting Ethical Investors Limited ABN 46 102 469 821 AFSL 294147.
We acknowledge Aboriginal and Torres Strait Islander peoples as the traditional owners and original custodians of the lands and waters on which we all live and work. We pay our respects to Elders past and present.
©2024 Uniting Ethical Investors Limited
