In 2020, FÉRIQUE Fund Management not only reaped the fruits of its previous responsible investment efforts, but also it turned even more resolutely toward the future by taking initiatives to create tomorrow’s benefits.
For the past 15 years, starting in 2006, when it adopted its Responsible Investment Policy governing the exercise of the FÉRIQUE Funds’ proxy voting rights, until the present day, FÉRIQUE Fund Management has lived up to the commitment that made it one of the first financial firms in Quebec to address this issue as well as an important player in responsible investing.
In 2020, FÉRIQUE Fund management continued to apply its three-pronged approach: exercise of voting rights, integration of ESG criteria and shareholder engagement.
► Exercise of proxy voting rights
► Integration of ESG criteria into investment analysis and decision making
► Shareholder engagement
► Toward ever more sustainable investments in 2021
► Responsible investment activity report
Proxy voting rights enable shareholders to have a positive influence on the companies they invest in. To that end, transparency, accountability and long-term profitability are the three main principles defining our policy.
In 2020, the FÉRIQUE Funds exercised their voting rights on 6,510 proposals submitted to 473 shareholder meetings.
In 54% of the cases, we supported the recommendations made by boards of directors. Our dissenting votes concerned mainly the election of board members and executive compensation not aligned with shareholder interests. For more information, see our Voting Reports and the Proxy Voting Policy.
Integration of environmental, social and governance (ESG) criteria has become an essential complement to the organization’s overall approach to investment risk management. It is above all pragmatic: we strive to improve our practices from a collaborative perspective, taking extra-financial factors into account rather than excluding securities from the outset and thereby losing our power of influence.
All managers of the FÉRIQUE Funds are signatories to the United Nations Principles for Responsible Investment (PRI) and, as set out formally in our prospectus, they are committed to including ESG criteria in their investment approach and decision making.
FÉRIQUE Fund Management thus ensures it is well aware of the responsible investment policies and practices of all firms to which it gives management mandates. Due diligence visits were carried out virtually this year and allowed us to effectively verify all activities of the managers’ key departments, including the teams handling ESG issues.
The last component of our approach is shareholder engagement, which involves working to ensure portfolio companies improve their ESG practices.
In partnership with the shareholder engagement services firm Æquo, we initiated dialogues with Barrick Gold, Enbridge and Nutrien in addition to continuing those begun last year with Scotiabank, Dollarama, Metro and TC Energy, as well as Pfizer, Truist and Lowe’s in the United States. Æquo was also involved in various collaborative investor initiatives on a number of matters, such as diversity and inclusion, equitable access to safe, high-quality health care technologies, carbon-related issues and responsible corporate taxation. These efforts aim to resolve various issues affecting the companies.
By collaborating with Æquo, we join forces with other investors to increase our ability to promote corporate best practices.
The global health crisis that hit in 2020 has highlighted the importance of considering extra-financial factors and seeking business models that are more resilient and sustainable. This heightened awareness of human and natural capital is a fine opportunity to rebuild the economy in such a way that development will become more equitable and sustainable. Keenly aware of the role it can play in this collective shift, FÉRIQUE Fund Management redoubled its efforts over the past year to ensure responsible practices and thus enhanced its product and service offering.
Action plan on energy transition management and carbon footprint
Building on last year’s efforts to combat climate change, FÉRIQUE Fund Management continued its efforts in 2020 by developing a strategic plan with the dual objective of protecting its funds from energy transition risks and actively contributing to the reduction of global greenhouse gas (GHG) emissions. For example, FÉRIQUE Fund Management officially set interim reduction targets, as well as the goal of carbon neutrality by 2050. Beyond its own activities, FÉRIQUE Fund Management is also committed, through its networks, to promoting any action that will resolve the climate issue.
Creation of sustainable investment funds
Of the many projects undertaken during the year, the creation of sustainable investment funds is probably the one whose positive impact will be the most tangible for our investors. The funds, launched early in 2021, are structured to link investments to the United Nations Sustainable Development Goals and will enable their holders to see how their assets contribute to a more prosperous and sustainable world.
Responsible investment accreditation
To provide you with accurate, detailed information about responsible investment and to inform you effectively, all the advisors and mutual fund representatives of FÉRIQUE Investment Services, the principal distributor of the FÉRIQUE Funds, have completed the RIA (Responsible Investment Association of Canada) certification program and obtained the Responsible Investment Specialist (RIS) designation. In this complex and ever-changing world, you can count on these specialists to guide you toward choices that meet your values as well as your performance goals.
Stocks that are good for your portfolio and the planet!
FÉRIQUE Fund Management has long been active in responsible investment and has always done its utmost to take it even further. So it is with some pride that we announce the increase in our overall rating in the most recent PRI survey. This annual evaluation is based, above all, on actions that lead to concrete change. For example, we were pleased this year to note the result of our ongoing dialogue with Enbridge. Last fall, Enbridge announced that it had set a target of net-zero GHG emissions by 2050 and also that it would report on the carbon intensity of the energy produced by its operations. This outcome demonstrates the merits of collaborative engagement and the power of dialogue as a lever for progress toward more responsible practices.
In this spirit, FÉRIQUE Fund Management was involved in 2020 in various statements on issues such as diversity and inclusion, maintenance of rules concerning shareholder proposals, respect for human rights across corporate value chains and better disclosure of ESG data by publicly traded companies. Ultimately, all these actions contribute to a better longer-term financial performance and a healthier living environment for everyone.
Activity Reports on Responsible Investment
(PRI Transparency report)
PRI signatories are required to report annually on their responsible investment activities. This ensures: