Stewardship policy

We believe that institutional investors like M&G should publicly disclose their policy on how they will discharge their stewardship responsibilities.

Our ‘Issues Arising from Share Ownership’ publication sets out our expectations of the companies we invest in, how we monitor investee companies and how we engage with companies that fail to meet our expectations.

Our approach to stewardship continues to evolve and we regularly reflect on our activities, reviewing and revising our policies when appropriate.

How we discharge our stewardship responsibilities:

  • We hold regular meetings with companies to monitor their developments over time and assess progress against objectives
  • Monitoring and engaging with investee companies, as well as voting at shareholder meetings and reporting to clients, is undertaken by the investment teams, analysts and members of our Corporate Finance & Stewardship team on an integrated basis
  • Whilst UK-listed companies are the primary focus, we endeavour to extend these principles to our overseas-listed equity investments as widely as we can, taking into consideration local regulations and market practice

The value of investments will fluctuate, which will cause fund prices to fall as well as rise and you may not get back the original amount you invested.

How M&G monitors investment decisions

​Investment decision to buy shares in a company 

Our fund managers determine whether a company is appropriate for a specific fund mandate. In general, our intention is to hold an investment over the medium to long-term. We only invest in companies after undertaking extensive research based on information and analysis from both our in-house analysts and external sources. This is likely to include reviewing a company’s published materials and brokers' research, as well as meeting with directors and visiting company premises. These activities at the start of the investment process form the base of our ongoing stewardship role. We seek to fully understand our investments - both their opportunities and risks.

​Monitoring investments 

Regular monitoring, including open and purposeful dialogue with investee companies, enables us to determine whether an investment remains appropriate (see Principle 3).

We proactively engage on any issue which may affect a company’s ability to deliver long-term sustainable performance and value (see Principle 4). When companies consistently fail to achieve our reasonable expectations we will actively promote changes, ranging from the formulation of a new strategy to the appointment of new directors. It is the prerogative of our investment team to sell shares based on their valuation assessment.

We exercise our right as a shareholder to vote on resolutions on behalf, and in the interests, of our clients, holding companies to account. When we vote at shareholder meetings, we do so with the long term interests of the respective company in mind. Our voting decisions are guided by our voting guidelines which are derived from our 'Issues Arising from Share Ownership' publication (see Principle 6).

Divesting from an investment 

At some point, our fund managers may decide to divest from a holding. This might be for a variety of reasons. For instance, the company may no longer be suitable for a fund's mandate, the outcome of engagement may be unsatisfactory or it may be a result of the investment team’s valuation assessment. Our fund managers always make these investment decisions.

M&G's approach to stewardship

Explore all the ways in which we comply with the UK stewardship code