Responsible investing

Responsible investing at M&G

At M&G we are, first and foremost, stewards of our customers’ assets, and we take seriously the responsibilities that come with this role. Our responsible approach to investment management is long-term, and we encourage all our investment professionals to think creatively, act with conviction and work collaboratively to meet our customers’ changing needs.

Our approach
We encourage responsible practices in our investee companies through active engagement with company management, while using our votes to protect the interests of our customers as shareholders. Working closely with management of the companies in which we invest helps to ensure they are delivering the best possible long-term, risk-adjusted returns. This includes considering the environmental, social and governance (ESG) practices of those companies, where these issues can represent material long-term risks and opportunities.

The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested.

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Case studies

Our fund managers believe that the long-term success of companies is supported by effective investor stewardship and high standards of corporate governance. We believe that if a company is run well, it is more likely to be successful in the long term. Social and environmental issues can also have an important impact on company performance. Well-managed companies take these issues into consideration as part of their successful development.

We engage with investee companies, alongside the investment teams, on issues including board composition, strategy, culture, capital allocation, executive remuneration, mergers and acquisitions and social and environmental responsibility. Here some short examples:

Gibson Energy – Strategy

GibsonWe believed that Gibson Energy was too diversified and, in our assessment, needed to undertake a strategic review and restructure its portfolio of assets by selling non-core businesses and becoming more focused on infrastructure.

HSBC – ESG

HSBCWe wanted to understand the HSBC’s current strategy to tackle financial crime and their commitment to sustainable finance.

Unilever – Corporate structure

UnileverWe became concerned with consumer giant Unilever after the company announced its intention to move from a dual corporate structure to a single structure, based in the Netherlands.

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Funds

While M&G fund managers incorporate ESG considerations in their investment approaches, the following funds have adopted a more systematic approach to the integration of ESG.

ESG Banner Greece 

Source of all information: M&G Investments, September 2019.

UCITS HAVE NO GUARANTEED RETURN AND PAST PERFORMANCE IS NOT A GUIDE TO FUTURE PERFORMANCE

The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested.

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