Active Ownership and ESG integration
Active ownership
Active ownership, through company engagements and voting, is undertaken to ensure that our investment universe is in compliance with DNB’s Instruction for Responsible Investments and to encourage companies’ development in a positive direction. Another way to influence companies in a positive manner, is by voting at general meetings.
Our company dialogues
Company dialogues may be undertaken to discuss specific ESG incidents (reactive), or to improve companies’ general performance with regards to ESG risks and opportunities (proactive).
As of 31.12.2024, we had engaged with companies on the following topics:
| Topic | Number of dialogues |
|---|---|
Climate change/greenhouse gas emissions | 70 |
| Water and oceans | 14 |
| Biodiversity including Deforestation | 40 |
Other environmental issues | 17 |
Human rights, child labour, labour rights, local communities/indigenous rights | 86 |
| Human Capital & Ethical AI | 12 |
Other social issues | 10 |
Board structure and independence | 17 |
Remuneration | 17 |
Other governance issues (including tax and corruption) | 36 |
Total | 327 |
See more detail of examples of company dialogues in our annual and quarterly reporting.
Voting
Our voting guidelines state that we shall vote at all Norwegian general meetings for listed companies we have ownership in, and we have adopted a systematic approach to determining which global companies’ meetings we will vote at:
- Companies where we have a significant position
- The largest holdings in each active portfolio
- Strategically important items, and ESG-related topics
Voting will primarily happen by proxy, but we will physically attend shareholder meetings in certain cases. Our proxy voting service provider, ISS, facilitates the voting process by providing both standard voting analyses, and analyses based on our own voting guidelines. These resources are used to inform our voting decision between the RI team and our PMs. Reoccurring themes include remuneration, issuance of shares, Board structure, double roles (between the Board, management and Nomination Committee) and capital structure (including authorisations). We are also increasingly seeing credible shareholder proposals related to ESG themes, specifically in regards to climate-related disclosure. Other ESG topics include reporting on political lobbying, gender pay disparity and responsible tax practices.
In 2024, we voted at 1358 general meetings. See more information on how we have voted here.
ESG integration
We have close dialogue with our portfolio managers on ESG risks and opportunities.
Based on our screening and in-house research, we highlight potential ESG risks and opportunities to the portfolio managers in addition to alerts on controversial issues. Furthermore, we also provide inputs and recommendations about divesting or investing in securities.
ESG and CO2 data is incorporated into our portfolio management system and is available to all of investment professionals. Many of our portfolio managers use this data in their company risk assessments, financial modelling, and investment decision making in several of our actively managed funds. We have also developed a system for capturing changes in companies’ ESG scores and potential or realised breaches in international norms and standards. This information is sent to portfolio managers on a regular basis. Through this information, we aim to identify warning signals of potential larger incidents. This data may trigger further investigation and discussion with the RI team regarding potential risks and opportunities and the financial effect from this. These discussions may trigger actions such as further investigation, engagement in dialogue with the company, or impact on the investment decision.
The process for ESG integration is constantly evolving, and we aim to further develop the systematic financial modelling utilising material ESG factors.