Influencing for good: Responsible investing in 2020

Risk warnings

The value of investments and any income derived from them can go down as well as up and investors may not get back the original amount invested.

Views and opinions have been arrived at by BMO Global Asset Management and should not be considered to be a recommendation or solicitation to buy or sell any companies that may be mentioned.

The information, opinions, estimates or forecasts contained in this document were obtained from sources reasonably believed to be reliable and are subject to change at any time.

Unless otherwise stated, all sources for data in this report are BMO Global Asset Management, as at 31 December 2020.

2020 was a year none of us could have expected, as the COVID-19 pandemic changed much about the way we live and work. Yet our commitment to responsible investment at BMO remained as clear as ever. We continued to allocate our capital responsibly and engage companies on environmental, social and governance (ESG) issues, reflecting our corporate purpose of boldly growing the good in business and in life.

Our engagement highlights

During 2020, we engaged 760 companies across 50 countries on a wide range of ESG issues. We recorded 1,541 total engagements, resulting in 343 instances of positive change, which we refer to as milestones.

  • 31% of our engagement linked to environmental issues – accounting for 28% of our milestones
  • 43% of our engagement linked to social issues – accounting for 17% of our milestones
  • 26% of our engagement linked to governance issues – accounting for 55% of our milestones

SDGs and engagement

The UN Sustainable Development Goals (SDG) provide an ambitious roadmap towards a more sustainable world by 2030, as well as a clear engagement framework for investment specialists to encourage improvement within investee companies.

In 2020, 79% of our engagement linked to the SDGs. Our top engaged goal was SDG 8 – decent work and economic growth for all – at 19%. This largely related to our engagement on workplace safety, which was paramount in the pandemic environment.

Voting and corporate governance in 2020

Exercising the right to vote is a key part of our stewardship responsibilities, and an opportunity to influence change. In 2020, we voted on 117,820 resolutions – 27,563 of which were against management. We regularly engage companies before and after voting to explain our expectations and invite comment, and to explain our reasons for any votes against management

Public policy and investor initiatives

We continued to contribute to policy development through engagement with regulators in 2020, as we believe that policy and regulatory change are often the catalysts for improved corporate behaviour. Topics covered ranged from climate change in the EU to investor stewardship in Japan. We also participated in collaborative investor engagements and initiatives, which can be key to improving ESG standards at a larger scale. The issues we collaborated on included modern slavery and mental health & wellbeing.

Quote line

As positive momentum builds around tackling the challenges our societies face, I am excited for what the future can hold, and proud of the opportunity we have at BMO to make a difference.”

Kristi Mitchem, CEO, BMO Global Asset Management

Risk warnings

The value of investments and any income derived from them can go down as well as up and investors may not get back the original amount invested.

Views and opinions have been arrived at by BMO Global Asset Management and should not be considered to be a recommendation or solicitation to buy or sell any companies that may be mentioned.

The information, opinions, estimates or forecasts contained in this document were obtained from sources reasonably believed to be reliable and are subject to change at any time.

Unless otherwise stated, all sources for data in this report are BMO Global Asset Management, as at 31 December 2020.

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