Stewardship
Stewardship involves using the formal rights we hold as owners of companies and the opportunities that result from these rights, to support the value of the assets in members’ portfolios.
CSC's stewardship approach
CSC has been a pioneer in innovative implementation of stewardship for more than 20 years. This includes advancing our stewardship priorities by:
- Systematically using our formal rights and relationships (e.g. casting votes at company meetings; our external partners including investment managers); and
- Systematically voting all our stock at company meetings, in ways that support our priorities;
Since our stewardship is aimed at achieving more dependable retirement outcomes, we engage in stewardship activities only where we consider such activity is both cost-effective and in our members’ best financial interests.
CSC's stewardship priorities
Financial markets’ feedback to companies does not consistently promote the value of long term and widely diversified portfolios like those CSC manages for members. Our stewardship aims to create greater alignment, via a focus on:
- Secure shareholder rights, such as the right to determine a company’s board of directors and make decisions on major capital transactions;
- Boards/election of directors with strong strategic competencies and governance competencies; and who are conscientious with respect to company impacts and externalities; and
- Accountability to shareholders, via transparency about all of the above.
Investors delegate the oversight of companies to boards of directors, rather than being involved in management decisions directly. CSC’s priorities reflect the important role of company directors, in this context.
The role of proxy voting
Holding shares in a company usually provides investors with the right to vote at the company’s meetings. When investors submit these votes via written instructions instead of attending the meetings, this is known as 'proxy voting'. We see the right to cast votes in this way as intrinsic to the value of such investments. We use these rights at every opportunity, drawing on a range of sources to inform how we vote.
Because they delegate oversight of each company to its board, investors commonly follow board recommendations about how to cast votes at their company’s shareholder meetings. We cast votes contrary to board recommendations where we consider this better supports the value of members’ investments, consistent with our priorities (above).
Frequently asked questions (member link)
We review CSC’s stewardship approach with our Board every 3 years.