Companies Act 2014

F424 [ Engagement policy - asset managers

1110H

1110H. (1) Subject to subsection (2) , a relevant asset manager shall develop and publicly disclose an engagement policy in accordance with this section.

(2) A relevant asset manager who does not develop and publicly disclose an engagement policy in accordance with this section shall publicly disclose a clear and reasoned explanation for its failure to do so.

(3) The engagement policy developed under subsection (1) shall describe how the relevant asset manager

( a ) integrates shareholder engagement in its investment strategy,

( b ) monitors investee companies on relevant matters, including strategy, financial and non-financial performance and risk, capital structure, social and environmental impact and corporate governance,

( c ) conducts dialogues with investee companies,

( d ) exercises voting rights and other rights attached to shares,

( e ) cooperates with other shareholders,

( f ) communicates with relevant stakeholders of the investee companies, and

( g ) manages actual and potential conflicts of interest in relation to its engagement.

(4) Subject to subsections (5) and (6) , a relevant asset manager that has developed an engagement policy in accordance with this section shall, on an annual basis, publicly disclose how its engagement policy has been implemented, in a manner that includes

( a ) a general description of voting behaviour,

( b ) an explanation of the most significant votes taken,

( c ) information on the use, if any, of the services of proxy advisors, and

( d ) information on how it has cast votes in the general meetings of companies in which it holds shares.

(5) A disclosure under subsection (4) may exclude information regarding votes that are insignificant due to the subject matter of the vote or the size of the holding in the company in question.

(6) Where a relevant asset manager does not, in a given year, publicly disclose how its engagement policy has been implemented in accordance with subsection (4) , the relevant asset manager shall publicly disclose a clear and reasoned explanation for its failure to do so.

(7) ( a ) Rules that apply to a relevant asset manager regarding conflicts of interest shall also apply to a relevant asset manager regarding the engagement activities.

( b ) For the purposes of paragraph (a) , rules that apply to a relevant asset manager regarding conflicts of interest include the following:

(i) Article 14 of Directive 2011/61/EU of the European Parliament and the Council of 8 June 2011 on Alternative Investment Fund Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No. 1060/2009 and (EU) No. 1095/2010 6 ;

(ii) Article 12(1)(b) and 14(1)(d) of Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) 5 , and the relevant implementing rules and technical standards under that Directive;

(iii) Article 23 of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (recast) 2 .

(8) A requirement in this section to publicly disclose any matter shall be read as a requirement to make the matter available free of charge on the website of the relevant asset manager that is subject to the requirement. ]

Annotations

Amendments:

F424

Inserted (30.03.2020) by European Union (Shareholders’ Rights) Regulations 2020 (S.I. No. 81 of 2020), reg. 7, in effect as per reg. 1(3).