Active ownership: real-world outcomes

The tragic conflict in Ukraine spurred an energy shock, intensifying global inflationary pressures, which in turn prompted a cost-of-living crisis and market volatility. We also saw a continued threat to nature and biodiversity presented by the climate crisis, including the devastating floods in Pakistan and the worst drought in Africa for 40 years.

The context changed over the course of the year, with governments needing to balance net-zero goals with a new imperative for energy security.

Many of the underlying issues that dominated the headlines last year go to the very heart of our work as a leading responsible investor. It is only by understanding the problem that we can reach the right solution.

In our latest Active Ownership report, you’ll read about the action we took during the year on behalf of our clients.

We continued to push for solutions to the climate crisis through our Climate Impact Pledge programme, which now captures over 5,000 companies to encourage long-term corporate action on behalf of our clients. We also held our second global Sustainability Summit, highlighting our purpose as a responsible investor. I was privileged to co-chair the COP26 Business Leaders Group with Alok Sharma until the COP27 climate summit – and am extremely proud of the progress the group made.

We stepped up our action on biodiversity, supporting calls at COP15 for a 'Paris moment for nature'. We also continued our global partnership with Lewis Pugh, UN Patron of the Oceans. Lewis swam across the Red Sea to raise awareness that rising water temperatures are starving coral reefs.

And importantly, we developed innovative, responsible investment strategies to meet growing demand from our clients, with around 95% of all LGIM's new products developed and mandates launched in 2022 being ESG-related. These included net-zero corporate bond funds and exchange-traded funds (ETFs) with Paris-aligned benchmarks.

In the document, our 12th annual Active Ownership report, you’ll also see how we exercised voting rights across our entire book, while engaging with companies, policymakers and other stakeholders on issues from the living wage, to deforestation, to board-level ethnic diversity. In addition, we highlight the areas where we were successful in raising standards at individual companies and across markets – and where more work needs to be done.

Our purpose is to create a better future through responsible investing. I’m truly grateful to everyone at LGIM for everything they did last year – and continue to do – to fulfil this purpose and effect the sustainable, real-world outcomes we all so urgently need.

Read our report here.

Key risk: The value of an investment and any income taken from it is not guaranteed and can go down as well as up, you may not get back the amount you originally invested.