On the go: Railways Pension Scheme manager Railpen is emphasising its commitment to net zero, while also highlighting the approach it aims to take with its portfolio companies over the next 12 months in its newly published 2022 voting policy.
The policy clarifies Railpen’s position on employee-focused engagement for equal voting rights, its pledge to continue protecting and strengthening its members’ savings, and continued emphasis on a net zero voting framework.
Engagement with companies will be in line with Railpen’s defined voting policy stance as outlined in its global policy. The upgraded 2022 document emphasises Railpen’s focus on sustainability trends such as climate transition and strengthening workforce representation, while also focusing on a net zero framework and the importance of one share, one vote.
Railpen’s pledge to a net zero portfolio by 2050 will follow a framework of member engagement and partnership with investors and policymakers to support climate change strategies.
Its commitment towards employee engagement is in line with the manager’s approach to inclusivity and delivering improved, longer-term performance, it stated.
The 2022 voting policy expects portfolio companies to publish their employee engagement strategy in accordance with Railpen’s focus on employee voice and representation.
Railpen aims to partner with investors and portfolio companies to set up a framework that will address employee engagement in the most effective manner.
The importance of minority shareholders and the role they play in contributing to the UK’s global reputation is strongly supported by Railpen.
The manager believes equal voting contributes to more effective stewardship, which in turn impacts corporate behaviour. Railpen aims to partner with others to promote engagement with private and public companies on a one share, one vote framework.
“Fundamental to achieving our net zero commitments is our constructive engagement with portfolio companies to ensure business strategies and activities effectively support the transition to a Paris-aligned world,” said Michael Marshall, head of sustainable ownership at Railpen.
“Exercising our voting rights on a company’s climate change approach is a vital part of effective stewardship which achieves real world change. Our voting policy this year, therefore, outlines in detail our approach both to routine voting on climate issues and Say on Climate resolutions.
“We will assess a portfolio company’s climate risk and net zero alignment status, and will not be afraid to use our vote to express support or sanction for a company’s approach and activities.”
Caroline Escott, senior investment manager at Railpen, added: “Covid-19 shone a bright light on the importance of fair workforce treatment and effective management workforce dialogue to a company’s continued financial performance.
“In 2020 and 2021, Railpen has been engaging extensively with companies across our portfolio on how, and how effectively, they are working to understand the experience of their workforces and reflect this in their decisions.
“We look forward to working with others in the coming months to outline investor expectations around what a meaningful approach to workforce relations could look like in the US and UK markets.”
