Corporate governance

As an investor, we want to see the businesses in which we invest adopting a culture of openness and fairness. When companies embrace these values the benefits are passed on to their workforce and supply chains.

After all in our opinion, a transparent and well-managed business is more likely to be a successful one.

Our approach to corporate governance

We will challenge companies to:

• adopt and implement all appropriate codes of best practice, e.g. the Combined Code of Corporate Governance;
• avoid excessive pay to directors and rewards for failure;
• have strong safeguards against fraud, bribery and corruption.

We were the first institutional investor to publicly disclose our voting policy in 2002 and our voting record is available here.

Our approach in practice

Executive remuneration

As a responsible shareholder, The Co-operative Asset Management believes good standards of corporate governance are essential in companies in which it invests.  As a responsible investor we want to share in the long-term success of businesses in which we invest.  But if a company fails to create value for its shareholders, we believe its wrong to give rewards to management that are to disproportionate shareholders returns no matter how difficult the economic situation. TCAM took this position long before the downturn.  For example:

• It voted against Northern Rock remuneration reports prior to the credit crunch
• It has refused to support RBS executive remuneration continuously since 2002
• It was one of few institutional investors to vote against the RBS/ABN-AMRO deal
• In 2002, it became the first institutional investor to make its entire voting record available to the public on-line.

In March 2009, we wrote to the Chairmen of the UK FTSE 350 companies to call for fairness and restraint on directors' pay to reflect the current challenging economic conditions.  The letter is attached.

View our policy on responsible shareholding

Responsible shareholding (PDF - 1.1Mb)

View our UK Corporate Governance and Voting Policy. (PDF - 0.2Mb)