Voting is one of the cornerstones of our stewardship approach. The exercise of our right to vote is one of the most effective tools we have for holding boards to account and encouraging good governance.

We vote globally on all of our listed investments. Our voting is guided by our UK Voting and Engagement Policy – which is broadly aligned with the UK Corporate Governance Code and Global Stewardship Principles.

The USS UK Voting Policy was updated in 2019 and signed off by the USS Board to reflect regulatory changes and developments in best practice. In particular, the fund integrated data from the Transition Pathway Initiative (TPI) into voting decisions and strengthened the escalation approach for voting Director Re-elections where a lack of diversity is evident:

  • We expect all companies to disclose information on their exposure to and management of climate risk. As a signatory to the Transition Pathway Initiative (TPI) we encourage all our portfolio companies to provide enhanced corporate disclosure by responding to the initiative’s information requests. From 2020 AGM season, we may vote against or abstain on the resolution to receive the report and accounts where we have concerns about a company’s management quality score, as assessed by the TPI. We also reserve the right to escalate the vote against the Chairman of the Board, and/or the Chair of any appropriate committees, in case there is no resolution to receive the accounts.

  • From 2020 AGM season, we will vote against the Chairman and/or members of the nomination committee if there is less than 33% minority gender representation on the Board and the Company has not disclosed a timeframe for addressing the situation. We also reserve the right to escalate the vote against the Chairman of the Board in subsequent years if no improvement is seen.

We form an independent decision on voting on a case by case basis. We take into account proxy research, the outcomes from engagement meetings, discussions with peers and our portfolio managers’ perspectives. When voting on companies outside the UK, we seek to take account of local practice by engaging local research providers, participating in regional corporate governance forums and working with other institutional investors investing in that market.

Whenever we vote against a resolution at an actively held stock, we usually write to the company to explain our concerns. We see this as an important way of providing feedback as part of our ongoing dialogue with our investee companies.

In accordance with best practice, we publish a list of global equity holdings and voting records.

Last updated: about 6 months ago