1This section applies to:
[Note: article 2(f) of SRD]
A firm must either:
publicly disclose a clear and reasoned explanation of why it has chosen not to comply with any of the requirements imposed by (1).
[Note: article 3g(1) and (1)(a) of SRD]
integrates shareholder engagement in its investment strategy:
monitors investee companies on relevant matters, including:
financial and non-financial performance and risk;
capital structure; and
social and environmental impact and corporate governance;
conducts dialogues with investee companies;
exercises voting rights and other rights attached to shares;
cooperates with other shareholders;
communicates with relevant stakeholders of the investee companies; and
manages actual and potential conflicts of interests in relation to the firm’s engagement.
[Note: article 3g(1)(a) of SRD]
The annual disclosure must include a general description of voting behaviour, an explanation of the most significant votes and reporting on the use of the services of proxy advisors.
[Note: article 3g(1)(b) of SRD]
The disclosure must include reporting on:
the key material medium- to long-term risks associated with the investments;
turnover and turnover costs;
the use of proxy advisors for the purpose of engagement activities;
the firm’s policy on securities lending and how that policy is applied to supports the firm’s engagement activities if applicable, particularly at the time of the general meeting of the investee companies;
whether and, if so, how, the firm makes investment decisions based on evaluation of medium- to long-term performance of an investee company, including non-financial performance; and
whether and, if so, which conflicts of interests have arisen in connection with engagement activities and how the firm has dealt with these conflicts.
[Note: article 3i(1) of SRD]