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HSBC Bank (UK) Pension Scheme: recommendations
From the information provided it appears that the HSBC Pension Scheme has an underlying commitment to responsible investment, but has not yet fully translated this into detailed policy implementation, monitoring or transparency. We would recommend:
RI policy, implementation and monitoring
- Inclusion of a detailed voting policy with regard to ESG issues
- Specific requirement for active engagement with investee companies on ESG issues.
- Identifying specific ESG risks and opportunities for incorporation into research and investment decisions.
- Establishing clear measures to ensure fund managers' performance on ESG issues is carefully monitored and regularly assessed.
- Incorporating assessment of the capacity of fund mangers to carry out the Scheme's ESG policy into its fund manger selection process, and into its investment management agreements
- Expansion of RI policy across non-equity asset classes
- The use of internal and/or external dedicated resources to undertake ESG engagement on behalf of the scheme.
- Consideration of membership of the UN PRI.
Given the fundamental importance of transparency to responsible investment, we would recommend the creation on a public website, alongside or instead of its intranet site, to include public disclosure of:
- The Statement of Investment Principles
- Detailed statements of RI policy, policy implementation and performance monitoring
- Full voting records and summary voting analysis
- Detailed ESG engagement initiatives and outcomes
- The scheme's annual reports, which should include a detailed section on responsible investment.