Engagement: our progress so far

In today's rapidly evolving financial landscape, strong dialogue between asset owners and their managers is increasingly important. Through our own engagement programme, which we’ve come to refer to as Hymans Engage, we’ve seen asset managers evolve their approaches to better meet our clients’ expectations. Meanwhile, the insights we’ve gained from our engagement also support our clients in their own stewardship efforts.

Why it's important to engage with asset managers

Engagement means active dialogue with the aim of influencing policies and practices of asset managers. This, in turn, has the potential to improve long-term investment outcomes. Proactive engagement can establish and reinforce investors’ expectations of the managers they appoint, helping to hold them to account.

Against a backdrop of pushback against progressive environmental and social policy, companies and asset managers are redefining their policy commitments. This makes it vital for asset owners to be clear in their expectations, to convey these to their managers and ensure that compliance with expectations is regularly tested and reinforced.

Learnings and outcomes 

Through our in-house manager engagement programme, our stewardship specialists have had focused discussions with a range of asset managers over the last 18 months. Our objectives from these meetings have been to understand the extent of manager ambition to address climate and biodiversity risks and to press for the adoption of more ambitious stewardship policies. These meetings have provided the following insights:

• In stewardship terms, nature lags climate. Most large asset managers have well-developed climate stewardship functions, but policy relating to nature and biodiversity is lagging. Investors who recognise the importance of addressing biodiversity loss don’t always have their expectations met by managers.
• The ambition of asset managers to drive change is highly varied. All managers recognise climate change as a risk to assets, and that driving change is one way to support long-term capital growth. However, some of the largest managers are the least ambitious when it comes to proactively encouraging companies to take meaningful steps to mitigate climate risk. The voice of the climate-aware investor is not always echoed by asset managers.
• Local regulation can hinder managers. Some managers interpret local laws to mean that they’re unable to demonstrate proactive or influential stewardship. Investors must be clear on the extent to which managers can represent their views on climate change. It’s becoming increasingly apparent that barriers are likely to remain, if not increase.
• Rhetoric is not always followed by action. Public announcements – particularly on environmental, social and governance issues, initiative participation and reporting – don’t always stand up to scrutiny. Investors must monitor and challenge initiative participation and overall approaches to stewardship to ensure their interests are being acted upon.

Engagement can also have impact. Over the course of 2024, six of the asset managers we engaged with have taken positive steps to evolve their stewardship programmes, with our engagement efforts being cited by managers as contributing to change. This means that more asset owners have access to products and stewardship policies that better meet their needs.

Hymans Engage: support our stewardship efforts

While one voice can sometimes be heard, many voices coming together are harder to ignore. Building on the progress made over the last 18 months, we’ll be inviting our clients and others to lend their support to our efforts through our ‘Hymans Engage’ programme. Over the course of 2025, we will be focusing our engagement efforts on climate actions by asset managers to help ensure that commitments are being adhered to, and progress made is not lost.

Over the coming months, we’ll set out our updated expectations of asset managers in light of the recent retrenchments from climate initiatives, testing managers against these expectations and focusing our engagement efforts accordingly. Our clients can join us on this journey by supporting our asks, thus helping ensure that managers represent investors’ views and meet their long-term objectives when engaging with companies.

Through the Hymans Engage programme, we’ll provide feedback on our engagements and report on the progress made.

Please reach out to our responsible investment team, your Hymans investment consultant, or click below to find out more about Hymans Engage.

Hymans Engage

If you have any questions or would like to discuss anything further, please get in touch.