Principles on the Stewardship Responsibilities of Institutional Investors - 2016

Principles on the Stewardship Responsibilities of Institutional Investors - 2016

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In order to enhance the mid- to long-term value and sustainable growth of investee companies and further the mid- to long-term interests of their clients and ultimate beneficiaries, institutional investors should comply with the Principles stated below. 1.
Institutional investors, as a steward of assets entrusted by their clients, beneficiaries, etc, to take care of and manage, should formulate and publicly disclose a clear policy to faithfully implement their responsibilities. 2. Institutional investors should formulate and publicly disclose an effective and clear policy as to how to resolve actual or potential problems arising from conflicts of interest in the course of their stewardship activities. 3. Institutional investors should regularly monitor investee companies in order to enhance investee companies’ mid- to long-term value and thereby protect and raise their investment value. 4. While institutional investors should aim to form a consensus with investee companies, where necessary, they should formulate internal guidelines on the timeline, procedures, and methods for stewardship activities. 5. Institutional investors should formulate and publicly disclose a voting policy that includes guidelines, procedures, and detailed standards for exercising votes in a faithful manner, and publicly disclose voting records and the reasons for each vote so as to allow the verification of the appropriateness of their voting activities. 6. Institutional investors should regularly report their voting and stewardship activities to their clients or beneficiaries. 7. Institutional investors should have the capabilities and expertise required to implement stewardship responsibilities in an active and effective manner.

Contributed by

Maria Lucia Passador

marialucia.passador@unibocconi.it