Through holding investments for the beneficiaries of the Fund, the Trustee of MTAA Super is a significant investor with fiduciary responsibility not only to manage each Investment appropriately, but to discharge its shareholder rights responsibly and in the best interests of members of the Fund.
The Trustee of MTAA Super believes that appropriately discharging its shareholder rights is an important part of the investment process and an obligation in carrying out its fiduciary responsibilities to members.
The following sections provide an overview of MTAA Super’s shareholder voting and investment governance policies.
Environmental, Social & Governance Risk Management
MTAA Super actively manages environmental, social and governance (ESG) issues when investing member funds. MTAA Super recognises that investment related ESG risks may impact the wealth our members and the communities they live in. The Trustee seeks to manage ESG risks over the entire life of MTAA Super’s investments.
In relation to directly held unlisted assets, ESG risks are considered by the Trustee during the investment selection process. These considerations influence the Trustee’s decision on whether or not to invest in a particular asset or industry.
MTAA Super continues to manage ESG issues once an investment has been acquired. MTAA Super monitors and actively seeks to influence the ESG risks within companies that the Trustee has invested in. Where ESG issues are identified by the Fund, MTAA Super will raise these concerns collectively as a member of the Australian Council of Superannuation Investors, or independently, through direct engagement with investee company boards and/or by exercising the Fund’s investor rights.
By actively managing ESG issues over the entire life of our investments, MTAA Super seeks to mitigate material ESG risks and maximise our member’s returns.
MTAA Super is a full member of the Australian Council of Superannuation Investors (ACSI).
ACSI is a not-for-profit organisation established in 2001 to represent ‘profit for member’ superannuation funds (industry, corporate and public sector superannuation schemes) on the management of environmental, social and corporate governance (ESG) investment risk. It provides independent research and advice to superannuation funds on the ESG risk of companies in which they invest.
Through its membership of ACSI, MTAA Super seeks to act collectively and collegiately with like-minded investors to mutualise the cost of ESG investment risk management and to be part of a strong collective voice on key governance issues.
ACSI conducts a program of direct engagement with listed companies on matters relating to governance, making the member funds’ ESG concerns known, in an effort to actively encourage companies to improve their corporate governance and disclosure and to allow ACSI to advise member funds to ensure informed decision-making in relation to proxy voting and related matters.
Shareholder Voting Policy
It is the Trustee’s policy to vote on all shareholder resolutions that MTAA Super is entitled to vote on. MTAA Super votes directly on shareholder resolutions for all listed Australian shares and for all unlisted directly held assets. MTAA Super holds listed International shareholdings via pooled trusts, and in this context the manager(s) of these pooled trusts carry out voting on behalf of investors.
Australian Listed Shares Proxy Voting
MTAA Super’s policy is to vote in line with ACSI’s voting recommendations as the default position for all Australian listed shareholder resolutions. However, the Trustee of MTAA Super retains sole discretion over proxy voting decisions and may vote differently to the ACSI advice in extenuating circumstances.
For resolutions that have investment (rather than corporate governance) considerations, and ACSI is unable to provide a voting recommendation, MTAA Super’s management liaise with the Fund’s listed equity managers and consider their analysis and voting intentions before forming a view on how to vote.
MTAA Super has a listed Australian shares securities lending agreement with the Fund’s Custodian, NAB Asset Servicing. Under this agreement, MTAA Super has specified that any shares on loan to NAB are to be returned to MTAA Super in sufficient time for the Trustee to exercise the Fund’s voting rights. No other securities lending agreement is in place for the Funds other investments.
For information on how MTAA Super has exercised the Fund’s voting rights on listed Australian shares, please follow the links below:
MTAA Super holds investments in unlisted infrastructure, private equity, property, alternatives credit and other assets. These investments may be directly or indirectly held and the governance arrangements and rights will vary from investment to investment.
Where those investments represent shareholdings in corporate entities, MTAA Super’s policy is to vote on all shareholder resolutions for which it is eligible.
When entering into these investments the Fund seeks the strongest possible governance, information and representation rights. These rights take a variety of forms and are generally subject to negotiation and are dependent on the size of the investment.
MTAA Super’s investor rights for each unlisted investment may include:
For directly held assets;
Explicit and unfettered right to appoint one or more directors to the Board of the investee in the Fund’s own right,
Shared appointment right of a Director with other like-minded investors,
Board observer status (no voting right), or
Information rights (for example access to management accounts, Board and Committee papers and the like)
For Indirectly held or pooled investments;
Investor Advisory Committee representation, and
Unit holder voting rights under the respective Trust Deed.
MTAA Super believes that the issue of corporate governance within the directly held unlisted investment companies and entities is equally as important as for the Fund’s listed shareholdings. In practice, the ability to influence the governance of the unlisted holdings is generally far greater due to the larger percentage shareholding that applies in these privately held companies with a smaller number of shareholders and the corresponding greater control and influence (as compared to a listed public company).
For further information on the unlisted investments held by MTAA Super please refer to the Fund’s latest Annual Report.