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Ensuring Strong Governance

As a large institutional investor, Sanlam Investment Group has sizeable investments in most of South Africa’s companies. This places us in a position to influence and encourage the companies we invest in to adopt sound governance principles. As corporate citizens, this is our responsibility and it makes long-term investment sense.

Considering ESG in Our Investment Approach

To safeguard the assets they invest in on behalf of their clients, pension funds, insurers and asset managers should be equipped to understand and respond to potential risks and opportunities arising from environmental, social and governance (ESG) factors. Understanding ESG issues and the potential impact of ESG factors on both their investment strategy and the broader operating environment is therefore an integral part of good governance for institutional investors.

In 2006, we formed a committee to drive the implementation of our governance responsibilities on behalf of clients. One of the first tasks of the committees’ Corporate Governance Unit (CGU) was to establish a framework for voting proxies (as envisaged in principle 1). This includes considering and incorporating ESG principles and data into our non-equity investment processes. We also engage company boards on governance and performance issues on behalf of clients. Where mandated, we vote all proxies of companies in which our clients are materially invested, without abstaining (as addressed in principle 2).

To promote environmental sustainability, we aim to:

  • Encourage companies to report on their material environmental issues;
  • Monitor how companies manage their environmental challenges over the life cycle of their products and services and encourage them to strive for continual improvements;
  • Require that companies adhere to laws, guidelines and codes of good practice applicable to them in the countries in which they operate;
  • Encourage Sanlam to follow the requirements and standards that we require of other companies, and employ sufficient resources to meet the environmental challenge, including outsourcing if required;
  • Research investment-related environmental risks and opportunities;
  • Integrate sustainability considerations into our investment process;
  • Vote all proxies where clients have investments;
  • In terms of our escalation policy, engage with companies on their material environmental issues and collaborate with other investors in engaging companies or lobbying regulators;
  • Disclose our environmental sustainability efforts to clients; and
  • Promote industry best practice, including management of conflicts of Interests, should they occur.

To promote social sustainability, we aim to:

  • Encourage companies to report on their material social issues;
  • Monitor how companies manage their social challenges and encourage them to strive for continual improvement;
  • Require that companies adhere to laws, guidelines and codes of good practice applicable to them in the countries in which they operate (in particular, we will not condone employment of child labour);
  • Encourage Sanlam itself to follow the requirements and standards that we require of other companies, and employ sufficient resources to meet the social challenge, including outsourcing if required;
  • Research investment-related social risks and opportunities;
  • Integrate sustainability considerations into our investment process;
  • Vote all proxies where clients have investments;
  • In terms of our escalation policy, engage companies on their material social issues and collaborate with other investors in engaging companies or lobbying regulators;
  • Disclose our social sustainability efforts to clients; and
  • Promote industry best practice, including management of conflicts of interests.

Transparency on Proxy Voting and Engagement Activity

Sanlam Investment Management’s proxy voting guidelines were first defined in 2006. Since 2010, the number of shareholder meetings Sanlam Investment Management votes at varies seasonally between 40 and 90 per quarter. We have shown aggregated voting data in the form of charts publicly on our website since 2012. In 2017, we placed the unabridged Responsible Investment Policy Document (which includes our voting guidelines) on our website, and in 2018, we added public disclosure of our voting activity per resolution.

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