Northern Ireland Local Government Officers' Superannuation Committee (NILGOSC) will use pass-through voting in its passively-managed equities held in the Legal & General Investment Management (LGIM) pooled funds.
Pass-through voting is when asset managers allow their clients to vote at AGMs or specials meeting of the public companies whose shares they manage on the client's behalf. The goal is to provide asset owners with greater alignment across their portfolio and a stronger voice in corporate governance, which can be more challenging to achieve in low-cost passive funds.
NILGOSC’s adoption of pass-through voting comes after fintech firm Tumelo partnered with LGIM. Tumelo allows the fund manager to pass the vote down to the institutional investor while still accommodating them within a pooled fund structure, providing the same flexibility as a segregated mandate.
Fund managers can onboard institutional investors by simply sending them a link to Tumelo’s digital platform and asking them to sign up.
While NILGOSC has exercised voting rights at company meetings of its actively-managed equity holdings, until now, it has not had the opportunity to indicate a preference on how votes are placed on passively-managed equities held in the LGIM pooled funds. Rather, it has relied on LGIM’s responsible investment credentials to cast votes according to its own voting policies.
NILGOSC’s CEO David Murphy said: “We’re thankful to each of our three partners, LGIM, Tumelo, and Minerva Analytics for working together to help implement an integrated PTV solution. NILGOSC seeks to improve corporate behaviour and protect shareholder value by maintaining effective shareholder oversight of the directors and company policies of the companies we’re invested in, and we’re very pleased to be able to implement our voting policy across more of our investments.”
