Axa Investment Managers stepped up its engagement and voting activity at investee companies in 2022, according to the French fund group's annual stewardship report.
The report published today reveals that the asset management arm of French insurance group Axa conducted 596 engagements with 480 entities in 2022, compared to 283 engagements with 245 entities in 2021.

Axa IM's "strengthened" voting policy led to at least one vote against cast in 60 per cent of meetings voted, as well as a 14 per cent opposition voting rate.

The highest level of opposition was for board issues, followed by executive remuneration, which respectively accounted for 42 per cent and 26 per cent of votes against.

Climate change was the theme most frequently covered in Axa IM's engagements, the subject of 28 per cent of its engagements, followed by human capital and corporate governance, which each accounted for 20 per cent. Biodiversity was the theme of 18 per cent of engagements.

Some 178 engagements last year were at senior executive and board level, representing 30 per cent of overall engagements, up from a quarter in 2021, Axa IM says.

"Climate change remains our engagement priority with companies," says Axa IM executive chairman Marco Morelli.

"This is perhaps best illustrated by our dialogue with a list of companies we perceive to be climate laggards to challenge them on their strategies."

Such firms are those deemed to have shown either a lack of net-zero commitments or quantified emissions reduction targets that were insufficiently demanding or not credible, according to the asset manager.

"Each laggard company is given three years to implement an effective decarbonisation strategy and if not actioned, we divest our holding," Mr Morelli says.

"On one occasion in 2022 where the response was unsatisfactory, I was proud to see Axa IM act on our convictions by co-filing a climate resolution," he says.

The firm has joined forces with several investors to file a resolution at US-based oil and gas group Chevron, which is to be submitted by Dutch campaign group Follow This at the company's 2023 annual general meeting, according to the stewardship report.

Ahead of the 2023 voting season, Axa IM also warns that it could vote against boards of companies that have been insufficiently responsive to biodiversity-related engagement requirements, and may vote against relevant board members when there is insufficient progress during thematic engagements.

The asset manager adds that company boards will be held accountable to ensure implementation of previous environmental, social and governance-related shareholder resolutions that gained significant support.

"Against a tumultuous backdrop that has seen misgivings about the case for ESG investing in certain parts of the world, we believe it is now more important than ever to influence company behaviour through effective and robust stewardship," Mr Morelli says.

"When we engage with investee companies, we act with conviction and put great emphasis on achieving positive and specific ESG outcomes on behalf of our clients."

"If the response or outcome is unsatisfactory, we have robust frameworks in place and are not afraid to take decisive action. The report details this and is evidence of our commitment to transparency," he adds.