Article date: 10 April 2001
Major fund manager greens the FTSE
Morley Fund Management's ('Morley') revised voting policyintroduces a requirement for large UK companies to publishenvironmental reports. Morley believes this is the first initiativeof this type in the UK fund management industry.
Morley, the UK based asset manager of CGNU plc, manages assetsin excess of £100 billion, over £42 billion of this is invested inUK equities, the equivalent of 2.5% of the UK stockmarket. Thisshare of the market adds substantial weight to this corporategovernance initiative.
Commenting on the new development, Anita Skipper, Head ofCorporate Governance at Morley said:
"Identification of environmental risks and opportunities isbecoming increasingly important for institutional investors. Webelieve that management ought to be actively considering steps toreport publicly on their key environmental issues. The new additionto our corporate governance policy encourages companies to move inthat direction. We believe this policy is unique in the UK fundmanagement industry."
The new addition to the Corporate Governance policy states:
FTSE 100 Companies:
- Morley expects all FTSE 100 companies, in all sectors, to haverobust processes to minimise damaging environmental impacts. Wetherefore expect these companies to publish a comprehensiveEnvironmental Report.
- Where FTSE 100 companies do not publish such a report, andafter consultation as to management intentions, we will voteagainst the resolution to adopt the Report &Accounts.
FTSE 250 Companies:
- Morley expects FTSE 250 companies in high risk sectors toproduce an Environmental Report. Where such a report is notproduced Morley will abstain on the resolution to adopt the Report& Accounts.
- Morley will review the situation each year but it is likelythat a harder stance will be taken, over time, to match theapproach taken with the FTSE 100 companies.
Over the last two years Government, non-governmentalorganisations, society and shareholders have been increasinglyinterested in environmental reporting. Tony Blair summarised theGovernment's approach in a recent speech* to industry managers andenvironmentalists:
"I would like to see more reporting on environmental and socialissues. The pioneers of environmental reporting - companies likeBA, BT, British Gas and BP - are seeing increasing benefits fromboth improved efficiencies and public image as a result. This issomething that all companies should be doing, and I am issuing achallenge today to all of the top 350 companies to be publishingannual environment reports by the end of 2001."
For further information please contact
|Morley Fund Management|
|Anita Skipper,||Head of Corporate Governance||020 7809 8205|
|Paul Moody,||Head of Business Development, SRI||020 7809 6197|
|Gay Collins/Caroline Deutsch|
020 7786 4888
Notes to Editors
* "Richer and Greener" Speech by Tony Blair to the CBI/GreenAlliance conference on the Environment. Tuesday 24 October 2000.www.number-10.gov.uk
1 - Morley Fund Management research has found that of the FTSE100:
- 37 companies already publish an environmental report
- 21 companies have a report planned
- 38 companies did not have a report / did not make Morleyaware of any report (however 11 included an environmental statementon their annual report or website)
- 4 companies gave no information / awaiting response
2 - High risk sectors
The following industry sectors conduct activities with a highrisk of direct negative environmental impact.
Aerospace & defence
Construction & building materials
Electronic & electrical
Forestry & Paper
Oil & gas
Steel & other metals
Morley Fund Management
Morley Fund Management is an independently managed, Londonbased, asset management business with £106 billion undermanagement. It has investment professionals based in Boston, Tokyo,Singapore and Dublin.
Morley is a wholly owned subsidiary of the CGNU Group andmanages institutional funds under the Morley brand. It also acts asinvestment manager for a range of retail investment funds, marketedunder the Norwich Union brand.
CGU plc and Norwich Union plc merged on 30 May 2000 to createCGNU plc, the UK's largest insurance group and one of the top-fiveinsurers in Europe with substantial positions in other marketsaround the world, making it the world's sixth largest insurer basedon gross worldwide premiums.
Morley Fund Management is a business name of Morley FundManagement Limited (incorporated in England with Registered No.1151805 and Registered Office 1 Poultry London EC2R 8EJ) andNorwich Union Investment Management Limited (incorporated inEngland with Registered No. 2152949 and Registered Office 8 SurreyStreet Norwich NR1 3NG) both regulated by IMRO and members of theCGNU Group