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www.issgovernance.com FULFILL YOUR PRI REPORTING REQUIREMENTS ISS Webinar | Thursday, 3 March 11:00 AM EST | 8:00 AM PST | 4:00 PM GMT | 5:00 PM CET

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Page 1: FULFILL YOUR PRI REPORTING REQUIREMENTS - ISS · really like the way the modules flow and felt as if I always had this big picture visibility of where I'd been, where I was, and where

www.issgovernance.com

FULFILL YOUR PRI REPORTING REQUIREMENTS ISS Webinar | Thursday, 3 March 11:00 AM EST | 8:00 AM PST | 4:00 PM GMT | 5:00 PM CET

Page 2: FULFILL YOUR PRI REPORTING REQUIREMENTS - ISS · really like the way the modules flow and felt as if I always had this big picture visibility of where I'd been, where I was, and where

ISS | Institutional Shareholder Services Inc.

Focus areas for today’s webinar

Introduction

PRI Reporting & Assessment Framework › Key areas of focus for 2016

Mandy Kirby Head of Reporting & Assessment, PRI

PRI ISS Solutions Overview › PRI principles ISS Solutions at a glance › Example: Principle 1 ISS Solutions

Ulrika Hasselgren Head of Sustainable & Responsible Investment, ISS

PRI ISS (Proxy) Voting Reporting › How ProxyExchange can help › Example: Principle 2 ISS Solutions

Jean-Nicolas Caprasse Head of European Business, ISS

Q&A

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Page 3: FULFILL YOUR PRI REPORTING REQUIREMENTS - ISS · really like the way the modules flow and felt as if I always had this big picture visibility of where I'd been, where I was, and where

ISS | Institutional Shareholder Services Inc.

Delivering a one-stop shop for Governance & RI in line with the Principles for Responsible Investment

RI & Proxy Voting Policy

Governance & ESG Research and Analysis

Dialogue & Engagement

Proxy Voting

Securities Class Action

Reporting & Disclosure

End-to-end Governance & RI Solutions

Experience, Expertise &

Service

Develop policies that offer a credible, sustainable approach and an established process through Policy service

Integrate policy with Governance research & scoring, ESG research & screening, proxy research & data services

Meet global stewardship codes, PRI reporting requirements,

through Voting and Engagement Disclosure service

Exercise active ownership through Proxy Voting service

Exercise active ownership through company dialogue service with focus on performance, as well as dialogue with stakeholders

Exercise active ownership through securities class

action service

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PRI REPORTING & ASSESSMENT FRAMEWORK

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Mandy Kirby Head of Reporting & Assessment PRI

ISS | Institutional Shareholder Services 4

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Executive summary

The PRI at a glance

Why responsible investment?

PRI services

Your dedicated PRI team

Value Proposition

AGENDA

Introduction to Reporting & Assessment

How to report to PRI

PRI’s proxy voting indicators

Reporting support

Q&A

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Executive summary

The PRI at a glance

Why responsible investment?

PRI services

Your dedicated PRI team

Value Proposition

THE PRI AND THE SIX PRINCIPLES

The PRI works with its international network of signatories to put the six Principles for Responsible Investment into practice. Its goals are to understand the investment implications of environmental, social and governance issues and to support signatories in integrating these issues into investment and ownership decisions.

The six Principles were developed by investors and are supported by the UN. They have nearly 1,400 signatories from over 50 countries representing US$59 trillion of assets.

The six Principles for Responsible Investment:

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Executive summary

The PRI at a glance

Why responsible investment?

PRI services

Your dedicated PRI team

Value Proposition

REPORTING & ASSESSMENT

MEASURE PROGRESS AGAINST YOUR TARGETS AND YOUR PEERS

“I had budgeted several weeks to complete it and found it took far less time. I

really like the way the modules flow and felt as if I always had this big picture

visibility of where I'd been, where I was, and where I needed to go.”

California State Teachers' Retirement System, United States

“We regard the reporting as a significant ESG implementation process for

identifying future improvement and reviewing our activities for the next year." Nissay Asset Management Corporation, Japan

“The reporting has been an informative exercise that has indicated just how

much we can improve our engagement and activities. The questions will form

the basis on which we seek to enhance our activity.” London Borough of Haringey Pensions Committee, United Kingdom

Evaluates progress against industry-standard framework (some signatories are beginning to audit their responses) and to benchmark performance against peers’

Strengthens internal procedures and builds ESG capacity

Delivers ongoing PRI feedback and tools for improvement

Presents the big picture – the dataset and Report on Progress are a huge resource for best practice

Summarizes your RI activities – valuable for engaging with internal staff, clients, shareholders and regulators

Benefits for signatories

“The PRI reporting framework has been a useful tool in understanding how

our responsible investment practices are being perceived by the market.”

Itaú Asset Management, Brazil

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THREE STEPS TO REPORTING

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PRI’s REPORTING FRAMEWORK

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MODULE STRUCTURE

Introduction

Pre-investment/ ESG incorporation

Post-investment/Active Ownership

Outputs and Outcomes

Communication

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GATEWAY

CORE ASSESSED

ADDITIONAL ASSESSED

DESCRIPTIVE

PEERING

INDICATOR TYPES

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ONLINE REPORTING TOOL

https://pri.reportingframework.com/

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Transparency

Report

Assessment

Report

Report on

Progress

OUTPUTS

SUBMIT AND RECEIVE YOUR OUTPUTS

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REPORTING CYCLE

Live Reporting Period

RI

Transparency

Reports

Online Tool Closed

Assessment

Report

Report On

Progress

Jan 4,

2016 Jan 2017

March

31, 2016

June

2016

Sept

2016

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PROXY VOTING

INDICATORS

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PRI’s REPORTING FRAMEWORK

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2016 REPORTING CHANGES

Indicators refined to improve data quality, reduce misinterpretation

Strategy and Governance: module renamed from Overarching Approach, indicators updated with new selection options

Fixed income definitions revised and new module

Listed equity – Active ownership: Proxy voting indicators updated with new selection options

All changes accessible in the online tool or module downloads – listed under Preface

Review of proxy voting indicators is underway during 2016 to ensure they are reflecting signatory processes

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GATEWAY INDICATORS

Organisational Overview module triggers proxy voting indicators

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LISTED EQUITY – ACTIVE OWNERSHIP

Summary of indicators

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LISTED EQUITY – ACTIVE OWNERSHIP

Indicator examples

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MANAGER SELECTION,

APPOINTMENT AND MONITORING

Summary of indicators

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PROXY VOTING – SERVICE PROVIDERS

How to report your service provider activity

Strategy and Governance

Discuss components and approach of RI policy

Listed Equity – Incorporation

LEI 04 – what information contributes to investment decision making and who provides it

LEI 05 – whether ESG information derived voting activity is shared with investment managers

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R&A 2015 DATA

Based on 463 respondents to the proxy voting section of the module

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APPROACH TO PROXY VOTING

Based on 463 responses

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ENSURING VOTES ARE CAST

(Voluntary Data)

Based on 337 responses

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INFORMING COMPANIES OF RATIONALE

Based on 463 responses

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SHAREHOLDER RESOLUTIONS

(Voluntary Data)

Of those Signatories that did file

shareholder resolutions, the majority

reported less than 3 filed in the

reporting year.

Based on 349 responses

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DISCLOSURE OF VOTING ACTIVITIES

Based on 463 responses

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SIGNATORY SUPPORT

Phone support

+44 (0) 2037143187

Online support

www.unpri.org/reporting

https://pri.reportingframework.com

E-mail support

[email protected]

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Where the global responsible investment community meets

6-8 September 2016

Marina Bay Sands, Singapore unpri.org/Singapore2016

[email protected]

#PRIinPerson

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PRI ISS SOLUTIONS OVERVIEW

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Jean-Nicolas Caprasse Head of European Business, ISS

Ulrika Hasselgren Head of Sustainable & Responsible Investment Business, ISS

ISS | Institutional Shareholder Services 32

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ISS | Institutional Shareholder Services Inc.

Compliance with PRI

ISS is pleased to be a professional service provider signatory to the PRI

PRI Principles ISS Services

Incorporate ESG Issues into Investment Analysis

› Investment Tools and Data, including: Data feeds, ISS Governance QuickScore, ExecComp Analytics, Special Situations Research, ESG Research and Screening Services

Act as Active Owners and Incorporate ESG Issues into Ownership Policies & Practices

› Governance Research and Proxy Voting Services › Securities Class Action Services › RI Policy Services

Seek Appropriate Disclosure on ESG Issues by Investee Companies

› Engagement tracking through ProxyExchange › Voting on ESG-related shareholder resolutions › Pooled Engagement

Promote Acceptance & Implementation of Principles in the Investment Industry

› Engagement Support and Pooled Engagement Services to facilitate and improve investor-issuer dialogue

Work with Investors to Enhance Effectiveness in Implementing PRI Principles

› Engagement Support and Pooled Engagement Services to facilitate and improve investor-issuer dialogue

› Governance Exchange provides an online governance community

Report on those Activities › Vote Disclosure Service › Engagement Support Services: Reporting module

1

2

3

4

5

6

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ISS | Institutional Shareholder Services Inc.

Compliance with PRI: Example Principle 1

How ISS Investment Services can help

PRI Principles ISS Services

Incorporate ESG Issues into Investment Analysis

› Investment Tools and Data, including: Data feeds, ISS Governance QuickScore, ExecComp Analytics, Special Situations Research, ESG Research and Screening Services

1

Details of your responsible investment policy

ESG information used

ESG information integrated in investment decision making

SG 01.1

LEI 04.2

LEI 05.1

PRI Indicator

› RI Policy Services

› Governance QuickScore, ExecComp Analytics, Special Situations Research, ESG Research and Screening Services

› Governance QuickScore, ExecComp Analytics, Special Situations Research, ESG Research and Screening Services

How ISS services can help

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ISS | Institutional Shareholder Services Inc.

Compliance with PRI: Example Principle 2

Proxy voting: Direct – Listed Equity module

LEA 02 Interact with companies on ESG issues › Engagement as part of research process

LEA 17 Description of voting policy › Governance Research and Proxy Voting Services

LEA 18 Typical approach to proxy voting decisions

› Governance Research to support client’s own decision making

LEA 20 Confirmation of votes › Participation in Vote Confirmation Projects

LEA 21 Securities lending programme › Global Share Recall Service

LEA 22 Rationale for dissent › Corporate Contact Database Service

LEA 23 Percentage of proxy votes cast › Proxy Voting Service

› Board Statistics Report

LEA 24 Proportion of ballot items that were for/against/abstentions

› Proxy Voting Service

› Board Statistics Report

LEA 26 Examples of proxy voting activities › Meeting Results Service

LEA 27 Disclosing of voting activities › Voting Disclosure Service

PRI Principles ISS Services

Act as Active Owners and Incorporate ESG Issues into Ownership Policies & Practices

› Governance Research and Proxy Voting Services › Securities Class Action Services › RI Policy Services

2

PRI Indicator How ISS services can help

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ISS | Institutional Shareholder Services Inc.

2016 PRI Reporting: a User Guide for ISS Clients

2016 User Guide for ISS Clients › Designed to support clients responding

to PRI Reporting Framework

› Contains fully updated suite of integrated ESG solutions from ISS and ISS-Ethix

› Not prescriptive

› Produced in discussions with PRI

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ISS | Institutional Shareholder Services Inc.

Questions & Answers

Mandy Kirby

[email protected]

Head of Reporting and Assessment

PRI

Ulrika Hasselgren

[email protected]

Head of Sustainable & Responsible Investment Business

ISS | Institutional Shareholder Services

Jean-Nicolas Caprasse

[email protected]

Head of European Business

ISS | Institutional Shareholder Services

If you have questions, please submit them through the Q&A function in the box on the right side of your screen.

www.issgovernance.com

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