We engage with businesses in our portfolio in order to understand them better and to encourage a more progressive approach to environmental, social and governance (ESG) issues. Engagement is undertaken directly by members of WHEB’s investment team and any new insights or information is fed directly back into the investment process.
We report on our engagement activity over the course of the year as well as on how successful we believe that we have been . In 2017, we engaged with 41 individual companies representing over two-thirds (68%) of the companies held in the investment strategy at the year end. In many cases we engage businesses on more than one issue in the course of the year. In total there were 111 issues that we engaged portfolio companies on with the most widespread issues being the independence of directors (28 companies) and the independence of the auditor (24 companies).
During 2017, nearly two thirds of our engagement (63%) was focused on governance issues such as director and auditor independence, remuneration policies and proposals and CEO compensation. Due to the adoption of stricter policies in 2017, particularly on director independence, but also on share buy-backs, this was a significant increase on the 38% of engagement that was focused on governance issues in 2016.