Pay top issue on DC member voting list

Pay is the most voted-on issue by DC pension scheme members, with almost three times as many votes cast on the issue a climate, rights or lobbying, according to figures from LGIM sourced through Tumelo.

Climate change, rights, lobbying, plastic, packaging and the Paris Agreement all featured in the top 10 issues.

LGIM’s partnership with Tumelo allows 4,400 members across 8 pension schemes to learn, evaluate and express their opinions on pending shareholder proposals. Between the launch of this partnership in September 2020 and mid-2021, over 13,000 votes have been cast by individual members of DC pension schemes administered by LGIM.

The 3,120 advisory votes relating to pay were made in relation to 46 different resolutions mentioning the word. These mentions ranged from resolutions approving board remuneration to the context of supply chains or staff wages. The 1,275 climate-related votes were made in connection to just 14 resolutions, while the 460 ‘Paris Agreement’ votes were on just two resolutions, suggesting strong feelings from members on climate-related issues.

Scheme members do not vote on the resolutions themselves – they express their view on issues through a vote on the Tumelo system, with this information passed on to trustees and Independent Governance Committee (IGC) members. Once DC pensions scheme members have shared their opinions as to how to they would vote on key issues, they are able to see how their views compare against many of their peers and their own fund managers, as well as see the outcome of the votes.

Legal & General Investment Management co-head of DC Stuart Murphy says: “This technology and exciting partnership with Tumelo is already making an important difference. Pension Schemes and fund managers managing relationships with corporate boards are increasingly going to be able to consider and even reference this polling of scheme members.

“Equally, and perhaps more importantly for the long term of the pensions system, this has opened up a new way for individuals to feel truly consulted about the detailed ways their retirement funds will shape corporate activity and society at large. At a time when DC pensions need more voluntary contributions, more understanding and in general more interest from members – we’re excited about the future as we roll this out further.”

Tumelo CEO Georgia Stewart says: “Working closely with LGIM, we have proven members care passionately about ESG issues and that these issues can be used as successful engagement topics to improve members’ connections to their long-term savings.”

keywords voted on by LGIM DC scheme members