FRC action On Stewardship Code Welcomed By ShareAction

ShareAction, the responsible investment organisation, have welcomed today’s announcement of the FRC’s Stewardship Code tiering exercise.

“We welcome this valuable exercise by the FRC,” said ShareAction Chief Executive Catherine Howarth. “Tiering is a critical tool to hold fund managers to account on their stewardship activities. The Stewardship Code will only function effectively if the high standards expected of its signatories are monitored and enforced.

Tiering is a critical tool to hold fund managers to account on their stewardship activities.

“ShareAction’s annual stewardship and transparency rankings of fund managers and pension funds reveal that while some do serious work on stewardship, the industry as a whole is falling short of the standard needed to properly protect UK pension savers. Effective stewardship of companies by professional investors is essential when millions of us rely on long-term returns from private pensions for our income in retirement. Box ticking is not good enough.

“The FRC’s decision to remove underperforming signatories of the Code that do not demonstrate improvement within six months is a welcome move with real teeth, and one that we hope will spur action among the lowest ranked fund managers.”