The British Columbia Investment Management Corp. is focusing on methane emissions regulation and board diversity among its key environmental, social and governance policy initiatives, according to its inaugural stewardship report.
In early 2024, the BCI responded to methane policy consultations by Environment and Climate Change Canada and the U.S. Environmental Protection Agency, said the report, noting the BCI supports both regulators’ approaches to methane regulation and has encouraged the ECCC to align itself to similar regulations in the U.S.
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Regarding board diversity, the BCI currently chairs the 30% Club Canada’s Investor Group, an advocacy group that aims to achieve a minimum of 30 per cent representation of women on corporate boards in Canada. The report noted the average female board representation on TSX composite index companies reached 36.6 per cent in 2023. Also that year, the investment organization provided support for the Canadian Securities Association’s proposals to enhance diversity-related disclosures across jurisdictions in Canada.
During its fiscal year ended March 31, 2024, the BCI contributed to 26 ESG-related policy consultations, roundtables and joint statements.
In terms of proxy voting activities, the investment organization said it voted against the management team at investee companies in 27 per cent of cases across its proxy voting activities. Overall, it voted across 2,445 meetings for companies based in 52 countries and voted against or withheld from 34 per cent of director nominees. The BCI also voted in favour of more than half (55 per cent) of shareholder proposals.
Based on its proxy voting guidelines based on ESG metrics, the investment organization voted against 11 director nominations at Boeing Co. for lack of board oversight. It also shut down a controversial executive compensation and stock option plan at Tesla Inc. that would see chief executive officer Elon Musk secure a US$48 billion compensation package.
In 2023, the BCI engaged directly with 134 public and private companies. More than half (58 per cent) of these engagements resulted in positive momentum or outright achieved their objective. On the other hand, 42 per cent of engagements are either at a neutral stage or lagging, the report said.
In a press release, Gordon Fyfe, chief executive officer and chief investment officer at the BCI, said the report is built on more than two decades of responsible investment at the organization. “Active ownership is critical to delivering the returns our clients depend on, both through the management of risks associated with responsible investing and by capturing sustainability-related opportunities.”
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