Demonstrating stewardship with an ESG tracker

Asset managers operating in the modern financial environment need to consider the importance of stewardship. Manual methods of portfolio engagement management simply aren’t enough anymore; asset managers require a more streamlined, efficient approach.

An engagement tracking system provides just that. With an engagement tracker, asset managers can achieve improved efficiency, better risk management and improved transparency and communication with stakeholders.

Best use of resource

For starters, an engagement tracker provides a single source of truth for all engagement data across multiple portfolios. Asset managers can track the latest information on their engagements, facilitating more efficient decision-making and resource management. This also reduces the risk of costly errors due to manual mistakes or incorrect interpretations of data. Spreadsheets just aren’t cutting it anymore!

Managing risk

From a risk management perspective, an engagement tracker can provide real-time updates to ensure that asset managers stay up-to-date on the latest developments with each of their engagements. Asset managers are able to track progress more efficiently throughout the entire life cycle of portfolio engagement activities. This allows them to proactively identify and address any potential risks before they become a problem.

A survey by global law firm Norton Rose Fulbright recently found that 28% of more than 430 general counsel and in-house litigation leaders said their so-called ‘ESG dispute exposure’ increased in 2022, and 24% expect it to deepen over the next 12 months. The key reasons are the absence of clear environmental, social and governance metrics and requirements, and heightened regulatory scrutiny. Disclosures perceived as false, misleading or insufficient may result in litigation.

Communication is key

An engagement tracker also offers better transparency and communication with stakeholders, including institutional investors, asset owners, regulators and other external parties involved in the process. Asset managers can easily provide detailed progress updates and outcomes to stakeholders as required. This simplifies reporting processes and ensures that everyone is on the same page at all times.

In conclusion, an engagement tracker provides a clear benefit over manual methods of portfolio engagement management. Asset managers can enjoy increased efficiency, better risk management and improved transparency and communication with stakeholders.

For asset managers looking to stay ahead of the competition, adopting a robust and reliable engagement tracking system offers peace of mind. Interested? We’d love to hear from you!

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