Active ownership is typically used to describe the way investors, investment managers and fund managers engage with the companies they invest in to encourage more ‘responsible’ behaviour.
The idea is that holding the companies to account will lead to a change in strategies and transformation of business models, which depending on the objective of the investors could, for example, contribute to limiting the damage of climate change.
With climate change deemed an investment risk, the desire to tackle climate change in portfolios has become even more of a priority for the financial services industry.
By the time you have read this feature you should be able to understand how active ownership works, how investors influence the investee companies and the role of the adviser.
It is worth 30 minutes of CPD.
