Legal & General : LGIM dials up engagement on nature, health and AI in latest Active Ownership Report

Legal & General Investment Management (LGIM), one of the world's largest asset managers, has published its Active Ownership annual report, revealing how it voted and engaged with companies over the course of 2023.

LGIM's Investment Stewardship team cast 149,000 votes at 15,580 meetings to drive long-term, systemic change on environmental, social and governance-related risk factors as it continues to seek to deliver sustainable value on behalf of its clients. Highlights of the report include:

• Environmental: LGIM expanded the scope of its environment engagements, with vote sanctions against 100 companies for failing to meet deforestation expectations, while 342 companies were subject to voting sanctions through LGIM's Climate Impact Pledge. 2023 was a record year for climate-related shareholder proposals, with LGIM voting on 145 climate-related proposals, supporting 77% of these. In 2024, LGIM will be further increasing its expectations of mining and energy companies.
• Social: Raising awareness of the link between public health and financial resilience, with LGIM campaigning on Anti-Microbial Resistance (AMR) and nutrition, focused on *McDonald's and *Nestlé. Activity also included a targeted human capital campaign on the living wage directed at 15 large food retailers around the world, and continued promotion of greater gender and ethnic diversity at board level and below.
• Governance: Continuing to protect and promote shareholder rights in the context of capital markets efficiency is a key governance focus. In the UK for example, the team is concerned that current proposals to improve capital market competitiveness have the potential to dilute key investor protections. Elsewhere, LGIM continued to scrutinise executive pay, supporting three quarters of UK remuneration policy votes but opposing 52% of pay proposals globally, due to companies not meeting our expectations for fair and appropriate long-term performance-based pay. The firm also published its expectations of tech companies around the governance of AI as an emerging stewardship risk.

With 2024's AGM season underway, LGIM is focused on company engagement across its six 'super themes', focusing on Climate, Nature, People, Health, Governance and Digitisation. The team consists of 26 professionals with an average of 12.5 years' experience, combining a global remit with local market knowledge and located in the UK, US, Japan and Singapore.