There are a number of drivers for increasing pension fund interest in ESG issues. This is reflected in widespread support for the new UN Principles for Responsible Investment and the two core ESG strategies embedded in these principles: active share ownership and integration of ESG into investment analysis.

The most basic form of active ownership involves voting shares in companies. All asset managers covered by this survey do so. However, there are considerable differences in the resources, diligence and efficacy of managers voting behaviour, as well as the extent to which managers are prepared to challenge company management. 

A number of asset managers do more than simply vote their shares; they also meet with company management to discuss concerns about ESG issues and their long term impact on the worth of the company. A few asset managers have substantial resources devoted to this task, holding more than 100 meetings each year, and demonstrating significant ability to influence corporate decisions. On the other hand, the majority of managers undertake virtually no activity of this kind. Public policy advocacy Many asset managers participate in efforts to influence policy makers in order to safeguard shareholder rights, and to encourage a regulatory environment conducive to good governance and responsible management of corporate environmental and social impacts. However, a small number of managers do an order of magnitude more work in this area than others. 

Most managers accept that ESG issues can be financially material, and take them into account in their investment decision-making. However, few managers devote special attention to these subjects and only a handful employ substantial dedicated resources. As a result, relatively few managers can point to examples where their enhanced analysis of ESG factors has added value from an investment point of view. However, a growing number of managers are directing broker commission to this area.