The U.K. government will establish a task force to investigate the barriers preventing investors' voting policies from being implemented by money managers in pooled funds.
In effort to enhance stewardship in the U.K., the task force will help develop improvements to issues faced by investors with voting in pooled funds, increase the number of managers that are implementing their clients' preferences and recommend regulatory and non-regulatory measures to ensure that managers execute the policies of trustees.
Pension funds investing in pooled funds currently outsource voting to their managers.
Simon Howard, former CEO of the U.K. Sustainable Investment and Finance Association, was named chairman of the group, with Sarah Wilson, CEO of Minerva Analytics, chosen as vice-chairwoman.
"I firmly believe the days of trustees leaving everything to asset managers without scrutiny must come to an end. We need to do more to improve pension schemes' and asset managers' stewardship and engagement with companies to ensure they are fit for purpose in the 21st century. I see no reason why trustees shouldn't be able to determine their own high level policies — on areas such as climate risk management, diversity, or pay — and find an asset manager to implement it," Guy Opperman, minister for pensions and financial inclusion, said in a release Tuesday.
Janice Turner, co-chairwoman of the Association of Member Nominated Trustees, welcomed the news. "The current situation, where trustees are disenfranchised as fund managers ignore their wishes and frequently take weak or contrary positions, cannot continue," Ms. Turner said in an email. "It is not right, it is not fair and it is in conflict with the regulatory requirements placed upon trustees."