Implementation Statement, covering the Fund Year from 6 April 2020 to 5 April 2021

The Trustee of the Fenwick Limited Superannuation Fund (the “Fund”) is required to produce a yearly statement to set out how, and the extent to which, the Trustee has followed the voting and engagement policies in its Statement of Investment Principles (“SIP”) during the Fund Year. This is provided in Section 1 below.

The Statement is also required to include a description of the voting behaviour during the Fund Year by, and on behalf of, trustees (including the most significant votes cast by trustees or on their behalf) and state any use of the services of a proxy voter during that year. This is provided in Section 3 below.

1. Introduction

The voting and engagement policies in the SIP were reviewed and updated during the Fund year in September 2020. These updates were part of a wider update of the Fund’s SIP to ensure compliance with the latest SIP regulations and to ensure the policies were appropriate in relation to the changes to the Fund’s investment strategy. In addition, the Trustee added new investment beliefs to the SIP, including “consideration of ESG factors in investment decision making leads to better risk-adjusted returns”. As part of this SIP update, the employer was consulted and confirmed it was comfortable with the changes.

The Trustee has, in its opinion, followed the Fund’s voting and engagement policies during the Fund Year, by continuing to delegate to its investment managers the exercise of rights and engagement activities in relation to investments, as well as seeking to appoint managers that have strong stewardship policies and processes.

2. Voting and engagement

As part of its advice on the selection and ongoing review of the investment managers, the Fund's investment adviser, LCP, incorporates its assessment of the nature and effectiveness of managers’ approaches to voting and engagement.

Over the period of 6 April 2020 to 9 September 2020, the Trustee held the majority of the Fund’s assets in a range of funds with St James Place Wealth Management (“SJP”). Within these funds SJP had delegated authority to invest the Fund’s assets across a range of underlying funds with other investment managers. As part of the selection and ongoing review of the underlying managers, SJP incorporated its assessment of the nature and effectiveness of managers’ approaches to voting and engagement through their Wealth Management surveys on the ESG integration of its investment managers. SJP provides ESG ratings for each of the underlying managers. Commentary on the manager’s engagement in their funds were provided to the Trustee in their monthly performance reports, which were considered on an ongoing basis.

The Trustee fully disinvested from the SJP funds on 9 September 2020. Over the Fund Year, the Trustee seeded new investments with L&G and BMO via the L&G platform and in a private credit mandate held with Arcmont.

In selecting and appointing each manager, the Trustee considered the managers’ ESG policies.

3. Description of voting behaviour during the year

As at the Fund Year end none of the Fund’s investments had holdings in listed equities. At the start of the Fund Year the Scheme held investments in a range of funds managed by SJP. All of the funds that held listed equities with SJP were pooled funds and the Trustee delegated to SJP the exercise of voting rights. Therefore, over this period the Trustee was not able to direct how votes were exercised and the Trustee itself did not use proxy voting services.

In this section we have sought to include voting data in line with the Pensions and Lifetime Savings Association (PLSA) guidance, on the Fund’s funds that held equities as follows:

  • SJP Global Equity fund
  • SJP Multi Asset fund
  • SJP North American fund
  • SJP Greater European Progressive fund
  • SJP UK & General Progressive fund
  • SJP Asia Pacific fund
  • SJP Global Emerging Markets fund

The Trustee disinvested its holdings from all of these funds over the reporting period.

SJP was unable to provide voting data at a fund level or on a look through basis for the underlying funds in which the SJP funds invest. SJP provided the Trustee with a copy of its Shareholder Engagement Policy that provides voting information at a firmwide level, which the Trustee has reviewed.

SJP was also unable to identify significant votes or provide information to help the Trustee assess the significance of votes themselves. As SJP were unable to provide the data and the Fund disinvested from the SJP funds over the first three months of the Fund Year we have excluded a summary of voting statistics from this Statement.

The Trustee will continue to work with its advisers and investment managers with the aim of providing fuller voting information, where applicable, in future implementation statements.

In addition to the above, the Trustee contacted the Fund’s other asset managers that don’t hold listed equities, to ask if any of the assets held by the Fund had voting opportunities over the period. The managers confirmed that none of the other pooled funds that the Fund invested in over the Fund Year held any voting opportunities.

3.1 Description of the voting processes

For the period up to 9 September 2020, the Fund invested in a range of funds managed by SJP, and delegated authority of these assets to SJP. SJP’s voting policy is not to consult with their clients before voting where they have delegated authority over voting processes to SJP. The managers that SJP appoint to run each of the mandates are responsible for deciding how they vote, often through proxies. SJP sometimes makes use of proxy voting policies but this varies by each manager and the fund managers are responsible for using these services.

SJP have a shareholder voting and engagement policy in place which applies to all its clients’ investments. SJP monitors its managers votes and assess the robustness of their process on an ongoing basis. SJP expects all of its external fund managers to be responsible stewards on behalf of its clients and undertake an active engagement approach. SJP expects every manager to engage with their underlying investee companies on a priority basis, including on all financially material ESG issues. SJP recognises that engagement with investees can take many forms, including face-to-face shareholder meetings, industry-wide collective action, and exercising voting rights. All these aspects are part of SJP’s monitoring process. As part of SJP’s annual responsible investment assessment, SJP collects information from its external fund managers, including but not limited to: engagement case studies on a range of ESG topics, their roles in any industry associations of which they are a part, and voting policy.