This quarter is always the busiest with many companies holding their AGMs and hence the voting activity, including engagements with companies, is our main focus of activity. As ever proxy voting season brings different challenges each year, particularly in the US where shareholder proposals often form a considerable proportion of the voting slate. One issue has been how to approach quite different governance standards in different geographies.
As an example, in the US, it is common for the chair and chief executive to be the same person, whilst in the UK this is frowned upon. Furthermore, the definition of an independent director is quite different: in the UK a tenure exceeding nine years for a non-executive director, calls into question their independence. However, in the US a tenure of 20 years plus might still be regarded as independent. After much head scratching, we intend to set our own `independent’ director standard in the US and will be evaluating the standards across the companies and third-party funds we invest in to get their take on this.
Margaret Schmitt joined us in May bringing specialist climate expertise to the team. This will be beneficial in a number of ways, not least our own Taskforce for Climate-related Financial Disclosures reporting as well as our ongoing programme of engaging with companies and funds on their net zero ambitions. Obviously, what we invest in is critical to our own climate action planning which we continue to focus on.
We published our Stewardship Priorities document earlier in the quarter; this sets out our engagement priorities for 2023 as well as reviewing 2022’s activities.