There needs to be “a step change” in how UK fund managers approach stewardship, a HM Treasury-led taskforce covering the asset management industry has argued. 
The Asset Management Taskforce has made 20 wide-reaching recommendations on stewardship in its Investing with Purpose: placing stewardship at the heart of sustainable growth report, which was published today.
The taskforce, which is a group of the UK’s leading investment managers, stakeholders and regulators, led by HM Treasury and supported by the Investment Association (IA), drafted the proposals to offer a blueprint for integrating stewardship into the investment process and to cement the UK’s reputation as a global centre of excellence in stewardship practice.
The report’s recommendations are split across three main ‘pillars’: stewardship behaviours, or practical steps to further develop how stewardship works in practice; stewardship for clients and savers, focused on generating sustainable value and achieving savers’ goals; and an economy wide-approach to stewardship, which revolves around the collective responsibility of market participants.
Among the specific proposals are the expectation that investment firms become signatories to the UK Stewardship Code, calls for a “step change” in investment managers’ approach to the culture, governance and incentivisation of stewardship, and a broadening out of stewardship from equities to fixed income and private markets.
Keith Skeoch, chair of the Asset Management Taskforce’s Stewardship Working Group and chair of the Investment Association, said: “Investment is a critical part of how we shape our economic future and will have a profound influence on the quality of the recovery from coronavirus crisis, not just in the UK but around the world.
“We need to seize this moment to ensure stewardship is further embedded at the heart of the investment process, so that we can create long-term sustainable value that benefits businesses, communities and the environment.”
John Glen MP, economic secretary to the Treasury, added: “The UK’s stewardship standards are internationally respected and contribute to our standing as a leading global asset management centre. These recommendations will encourage more effective stewardship right across the investment chain and help the asset management sector continue to support sustainable activity as we build back better and greener.”
The full report, including all 20 recommendations, can be read here.