Lothian taps Hermes for global voting advice
UK - The Scottish £3bn (€3.8bn) Lothian Pension Fund has appointed Hermes Equity Ownership Services (EOS) for a voting and engagement overlay to engage with companies internationally.
Following a recent review of how it incorporates environmental, social and governance issues into its investments, the fund says it has decided to extend its voting and engagement activity to companies outside Europe.
The company said in a statement today it will represent the pension fund as an owner of companies through its equity shareholdings internationally.
"Hermes EOS will provide Lothian Pension Fund with a full responsible investment and corporate governance advisory service, comprising voting, corporate engagement and public policy work, on its global equity portfolios," the statement read.
Lothian, also a signatory to the United Nations Principles for Responsible Investment (PRI), will be its first UK local authority pension fund client.
According to Colin Melvin, chief executive officer of Hermes EOS, the Edinburgh-based local authority pension fund, which recently took lead plaintiff status in a case against BP over misleading statements relating to the Prudhoe Bay oil leaks (See earlier IPE story: Lothian takes co-lead against BP), is "taking an important lead" in this area.
Hermes EOS' total funds under advice is now around £60bn. The company already advises the National Pensions Reserve Fund of Ireland, PNO Media, PSP Investments, PKA, VicSuper, the BBC Pensions Trust and the BT Pension Scheme, which owns Hermes.
Commenting on the appointment, Melvin said: "Trustees are increasingly realising the benefits of being active and engaged owners of companies in addressing their responsibilities and achieving good long term performance, a trend encouraged by the United Nations' PRI which now has over 360 signatories and represents over $14trn assets under management."
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