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The move comes as policymakers and regulators push asset managers to do more to hold companies to account in the transition to a low-carbon economy, and as Lyxor and peers look to ensure the value of their investments are not hit by corporate inaction.
BlackRock (NYSE:BLK) and Allianz (DE:ALVG) Global Investors are among investment firms recently to pledge a tougher line on climate, while Britain’s investment industry trade body said in March that firms needed to be more open about how they are handling climate-related risks.
For the forthcoming AGM season, Lyxor said it may refuse to sign off a board of directors’ actions for the previous year or approve an individual directors’ re-election at companies involved in “environmental controversies” or which are not transparent enough about their greenhouse gas emissions.
Refusing to sign off a board’s actions can make it easier for legal action to be taken against directors.
From next year, Lyxor said it may also refuse to approve the re-election of a chairman at any company which does not uphold the recommendations of the Task Force on Climate-related Financial Disclosures, a framework for assessing climate risk.
The group, which managed 148 billion euros ($161 billion) of funds at the end of March, will also vote against executives’ pay packages if climate and other “extra-financial” measures are not adequately woven in to the company’s pay policy.
Lyxor, which runs both actively managed funds and those that track an index, said it expected to vote on at least 5,000 resolutions at more than 400 meetings in 2020.
