In ESG analysis, what is the purpose of engaging in stewardship activities?

Engaging in stewardship activities serves the primary purpose of influencing corporate governance and supporting the improvement of long-term value. This involves proactive involvement by investors in the companies they invest in, aiming to promote responsible management practices that align with sustainable outcomes.

Stewardship activities can take various forms, including voting on shareholder resolutions, engaging in constructive dialogue with company management, and advocating for best practices in environmental and social governance. The intention is to encourage companies to adopt strategies and policies that enhance both their operational integrity and overall sustainability, which ultimately leads to improved financial performance over the long haul.

Through these efforts, investors can help to ensure that companies are held accountable for their practices, pushing for transparency and responsible decision-making that benefits a broad array of stakeholders, including customers, employees, and the wider community. This approach aligns with the principles of sustainable investing, where the focus is not merely on immediate financial returns but rather on fostering a resilient and profitable business model that can thrive in a complex and ever-changing global landscape.