"They have the credibility with the company. They know the companies ... better than asset owners," Mr. Zellner also said, adding that "what we as asset owners need to do is not only spend time engaging with companies but also spending time engaging with asset managers."
Wespath managed $28 billion in retirement plan assets as of June 30 for more than 130 United Methodist affiliated institutions.
Appearing on the same panel, Louise Kranenburg, manager for responsible investment at Dutch pension fund Pensioenfonds Detailhandel, Utrecht, said that while engagement works most of the time, asset owners should be more firm in their demands.
"At times, it is needed that you pick up the baseball bat and stand outside (of the company) just because some things don't cut it and are not there," Ms. Kranenburg said.
She added that better aligning different instruments such as voting, engagement and shareholder resolutions are needed.
Fellow panel member Nick Stansbury, head of climate solutions at Legal & General Investment Management, said that investors increasingly ask for data to measure their engagement efforts, which is a challenge for managers.
"Measuring the effectiveness of engagement is a really challenging subject but I am convinced that it will be much more effective over time, the more it is done in partnership with companies," Mr. Stansbury said.
"Companies that we are engaging with are starting to ask us more directly to tell (them) what asset owners are asking managers to do," he said.
Still, he was encouraged by changes that some companies are making in their approach to manager-engagement efforts.
"There is (an) increased desire from (the) most sophisticated companies to build a better line of communication. They understand that we will be pressuring them on issues that we are pressured on," Mr, Stansbury added.
