Demystifying stewardship How is it really done?
In a world where the word “sustainability” features everywhere and is on everyone’s mind, the word “stewardship” seems almost old-fashioned. We think it is anything but. It is an inseparable part of investment, and sustainable investing cannot occur without it. But there is also some confusion about what it means and how it works in practice. We dove into this topic and address 10 of the most common myths that we see in the market, and why Schroders continues to differentiate and innovate with all things ESG; thus, being good stewards of client capital.
10 myths about stewardship:
- Stewardship is a compliance exercise
- Stewardship is all about shareholder primacy
- Stewardship varies across holdings of the same company
- There is a ”typical” way to engage
- Engaging is about escalating
- Divestment is the only way to affect real change
- Voting against company management is the only proof of an engaged investor
- Stewardship is run separately from investment
- Sustainable investment is not about stewardship
- Stewardship is opaque and takes place behind closed doors
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The views and opinions contained herein are those of Schroders’ investment teams and/or Economics Group, and do not necessarily represent Schroder Investment Management North America Inc.’s house views. These views are subject to change. This information is intended to be for information purposes only and it is not intended as promotional material in any respect.