The National Association of Pension Funds is publishing a guide today to help pension trustees assess the stewardship abilities of their prospective investment managers.
The one-page document, named “Quizzing Fund Managers was launched on Ownership Day, an initiative by the UK Sustainable Investment and Finance Association to raise awareness of the benefits of active ownership in investment management.
The document highlights questions trustees should consider when selecting and subsequently reviewing their investment managers, including what codes of conduct or principles they have signed up to, how they incorporate non-financial risks into investment decisions and how they can demonstrate the effectiveness of their stewardship activities.
The document is drawn from the NAPF’s Stewardship Policy, which was published last year. The policy set out actions that can be expected of pension funds as the owners and providers of capital. These included the incorporation of stewardship criteria into manager selection and the monitoring of their activities to gain a greater understanding of their stewardship approach and ensuring they are aligned to and adhering to the pension funds’ policy.
Will Pomroy, corporate governance adviser, NAPF, says: “Pension funds are embracing their ownership responsibilities and are fostering a market for stewardship. Initiatives such as Ownership Day are very important in maintaining the momentum and promoting best practice.
“Trustees have a lot on their minds and need support. We have published this crib-sheet to help them consider stewardship factors when appointing their investment managers.”