Active Ownership

Our overarching aim is to influence companies to improve their practices, thereby securing long-term shareholder value and mitigating sustainability risks in the best interest of our clients.

Voting

DNB AM vote through informed proxy voting to secure long-term shareholder value and ensure that companies act responsibly. We believe it is important to evaluate voting decisions together with what we achieve through engagements and other investor initiatives.

Voting guidelines - Global

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Voting guidelines - Norway

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Engagements

Engagements are a key tool in delivering on our mandate as a responsible investor. We engage with companies on specific ESG incidents, or to improve companies’ general sustainability-related practices, which may otherwise lead to underperformance.

DNB AM divides engagement activities into incident-based (reactive) engagements and proactive engagements. Information on all company engagements are shared with investment professionals in DNB AM through our internal datatool to inform investment decisions. Engagements may either take place directly with companies, through our external service provider for engagements, or in collaboration with other investors.

Reactive engagement takes place when a company is reported (allegedly or confirmed) to be in breach of the DNB Group Instruction for Responsible Investments. In general, incident-based engagement processes should aim to not exceed two years unless significant progress has been made to rectify the situation that has lead to the suspected breach of the Group Instruction.

To prioritize which reactive incidents to engage on, we assess:

the severity of the suspected breach
our ownership status in the company
the probability that our engagement will have a positive impact on the situation.

The engagement process in a reactive engagement is considered successful if the following criteria are met:

→ the violation has ceased

→ the company has taken a responsible course of action

→ the company has taken a proactive and precautionary approach to improve its policies, routines, and practices to prevent future violations

→ the company’s action is verifiable (where relevant)

If the desired outcome of reactive engagement is not achieved, the engagement process will be evaluated and could be terminated if significant progress has not been made. Several points of action will be considered at such a point, amongst which is the renewal of the objectives for engagement, intensification of the engagement, targeted proxy voting, or the exclusion of the relevant company from DNB AM’s investment universe.

Proactive engagements are conducted with the aim of encouraging companies to mitigate sustainability risks before they materialize, or to take advantage of sustainability-linked opportunities that are not being sufficiently addressed at the present time. Proactive engagement may also be conducted as part of a fact-finding exercise and are important inputs to the investment decision-making process for the portfolio managers in DNB AM. The dialogues may revolve around a specific issue or to raise the company’s general level of awareness around sustainability issues, without the company being suspected of being in breach of the DNB Group Instruction for Responsible Investments.

For proactive engagements, the aim of our dialogue is continuous improvement, and the engagement periods may therefore be more flexible and long-term. To prioritize our proactive engagements, we assess:

- how large of a holding we have in the company

- if this is a company where we will have a large holding in the future

- if the company is a large holding in one of our actively managed funds

Setting clear targets and measuring progress using milestones

We set clear targets for all our engagements and measure progress against those targets using milestones:

Milestone 1
Issuer acknowledges issue and commits to mitigation and management.

Milestone 2
Issuer establishes a strategy to address the issue.

Milestone 3
Strategy is well formed and has moved into early stages of implementation.

Milestone 4
Implementation of strategy has advanced meaningfully, and related issuer disclosures are maturing.

Milestone 5
Issuer has implemented all aspects of its strategy that are reasonable to expect and the Change Objective is considered fulfilled.

Our focus areas

Supporting our active ownership activities are our long-term and thematic focus areas. These are the backdrop of our engagement activities, and we set goals and report on progress annually.

Long-term focus areas

Climate Change
Biodiversity
Water
Human Rights

Thematic focus areas

Human Capital & Artificial Intelligence

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More about votingRead more

How have we votedRead more

Voting guidelines - Global

Voting guidelines - Norway

More about engagementsRead more

Setting clear targets and measuring progress using milestones

This is marketing material. Past performance is not a guarantee of future returns. Returns may be negative due to falling market values. Read more

This is marketing material. Past performance is not a guarantee of future returns. Returns may be negative due to falling market values.