This is how we exercise active ownership
As one of the Nordic region's largest asset managers, it is our responsibility to act long-term and as active owners. We are convinced that companies working in a structured manner with managing the environment, business ethics and social responsibility will be more successful.
A key aspect of our sustainability work is our active ownership. The purpose of our active ownership is to safeguard our customers’ interests in ownership issues and to influence the companies in which we invest in their sustainability work.
Direct dialogues and collaborations to influence companies
In Swedish companies – where we many times are among the largest owners – we have direct dialogues with management and boards. The topics of such dialogues can, for example, be management systems, risks and opportunities linked to the environment and business ethics. In addition, we focus on remuneration programs and diversity on boards, with women's representation as one example.
Regardless of the type of investment, sector or type of challenge, we will address the company's overall strategy and risk management, and expect open and transparent communication. We will also most certainly address one or several sustainability related issues – defined as seven different engagement themes – depending on relevance and materiality in the specific case.
Our clients guide us in defining focus areas and valuable input when defining engagement themes going forward. In addition, the SDGs are considered paramount when formulating SEB Investment Management's long-term priorities and objectives. Our view is that the long term success of businesses is inextricably linked to the SDGs, since they create an economic context and society in which businesses can best thrive. Below are seven prioritised themes. These are areas of great importance for us in order to identify risks, opportunities and issues of relevance and materiality when engaging with our investee companies or other investors.
1. Climate change
- Net zero transition plans
- Science-based targets
3. Clean water
- Strategy and risk management
- Local environmental impact
4. Healthy societies
- Just transition
- Diversity and education
5. Supply chain management
- Human and labour rights
6. Excecutive remuneration
- Sustainable incentives
- Disclosure and transparency
7. Board effectiveness
- Culture and dynamics
Dialogues with companies outside the Nordic region
By collaborating with other investors, we can generate greater impact on companies outside of the Nordic region. We collaborate with different actors who conduct dialogues with companies in several different sustainability areas, often with a direct connection to the global sustainability goals. We also engage in thematic collaborations to drive issues that are important to our customers.
When investing outside the Nordic countries, we collaborate with EOS at Federated Hermes – one of the world's leading player in corporate dialogues. This gives us the potential to become even more successful in the ownership dialogues with foreign companies, where we normally have a smaller ownership share.
In 2021, SEB Investment Management had, together with the organisation EOS at Federated Hermes, over 2700 dialogues with 710 companies around the world on issues related to sustainability.
More than 50 per cent of the dialogues where related to climate issues. Most of the dialogues are led by EOS at Hermes, although in some cases SEB Investment Management staff are directly involved in the dialogue. 1,522 of the topics discussed were related directly to at least one of the Sustainable Development Goals.
During the year EOS at Federated Hermes held dialogues with 605 companies that SEB Investment Management holds a position in. The dialogues had the topics governance (39 %), environmental (24 %), social & ethical (22 %) and strategy, risk and communication (15 %). All dialogues have a target and are followed up and documented.
The time perspective for our dialogues
The time perspective for our dialogues varies, depending on the issues being discussed and the industry and company in question. SEB IM strives to complete the dialogues within 24 months, but is at the same time aware of dependencies, ownership issues and local conditions. Therefore it is not uncommon for corporate dialogues to take longer.
Owner dialogues through IIGCC, PRI and CDP
Another example of how we cooperate in order to influence companies outside the Nordic region is our work with Investors Group on Climate Change (IIGCC), Principles for Responsible Investments (PRI) and CDP Water. By collaborating with other investors in these contexts, we jointly represent a significant amount of assets under management, which gives us greater power to move things forward.
In 2021 our main focus areas within the framework of IIGCC, PRI and CDP were:
- Climate; with a focus on the 160 companies in the world that are responsible for the largest greenhouse gas emissions
- Climate; with a focus on water
- Climate; with a focus on palm oil
- Human rights with a focus on access to medicine in developing countries
Work in Nomination Committees and with general meetings
We engage in corporate governance, for example through our participation in Nomination Committees in companies where we are large owners. Corporate governance includes issues relating to renumeration policies, incentive programs, capital structure and sustainability. Sustainability primarily includes our dialogues with companies and our advocacy work. We also participate in general meetings and exercise our funds' voting rights.
Our view is that companies that work actively with managing the environmental, social and business ethics effects of their operations will have a greater chance of being successful. A clear focus on sustainability therefore benefits the companies' long-term development. SEB Investment Management's Principles for Ownership Engagement and our Sustainability Policy act as a framework for how ownership issues are handled and describe the requirements we place on companies in which we invest.
Corporate governance includes issues relating to compensation for company management, incentive programs, capital structure and sustainability. In the Nomination Committee's work, we place specific emphasis on ensuring the right competence and diversity on the board. Achieving a more even gender distribution on the boards of listed companies has long been in focus. In the boards that were appointed at the 2021 AGMs, and where SEB Investment Management participated in the Nomination Committee, the proportion of women was 40.5 per cent. This is higher than the average on the Stockholm Stock Exchange, which is 34 per cent. However, the slow rate of increase in the proportion of women on boards means that this is still an important focus area for us.
At the same time, SEB Investment Management works toward a broad anchoring of the Swedish Code of Corporate Governance and collaborates with other institutions to achieve broad support for our issues.
- Voting policy
- Principles for ownership engagement
- Participation in Board Nomination Committees 2021-2022 (pdf)
- Participation in Board Nomination Committees 2019-2020
- Voting at General Meetings 2021 (pdf)
- Voting at General Meetings 2020
- Proxy voting
- Statement on exercise of voting rights 2021
- Active Ownership Report July 2021-June 2022
SEB Investment Management AB is a wholly owned subsidiary of Skandinaviska Enskilda Banken AB. The fund company was formed May 19, 1978, with headquarters in Stockholm and organization number 556197-3719.