As one of the world’s leading investment companies, we believe we have a responsibility, not just to our clients, but to society as a whole.

We use our scale as a major investor to encourage the companies in which our clients invest to develop resilient strategies, think longer-term and consider their stakeholders. We also work towards changing wider market standards, policies and regulations to make the financial system more sustainable.

We do this because we care for our clients’ future and believe that good governance protects the long-term prospects of our clients.  The ultimate goal is to protect and enhance the investment returns for the benefit of our clients’ interests.

Our Corporate Governance and Responsible Investment team operates independently and reports directly to the LGIM board. This structure ensures that any potential investment conflicts of interest are minimised, and that we always act to achieve the best outcome for all our clients.

What is corporate governance

Transcript: What is corporate governance

Sacha Sadan:

Corporate governance is about being a responsible owner. What does that actually mean? It means to me protecting clients’ assets, aligning them with the interests of the shareholders, with the management of the companies who are running them, and also maximising – I think this is one that isn't used very often – maximising the assets, so sometimes helping on M&A activity, getting the best management teams to run your company.  Some of this is common sense, but sometimes it is missed from the word “corporate governance.” 

We truly believe that corporate governance generates better returns, or poor governance creates poorer returns, so as a major investor in global markets, we should take this seriously, and our team of 10 spend all their time trying to enhance corporate governance on the companies and investee companies that we own on your behalf.

Our investors do take corporate governance seriously and should do, because it does help enhance the value of their investments. Poor governance destroys value and we try to make sure that companies aren’t doing that. 

I think it is very important when you think about some of the issues that are going on with climate change, succession planning, the supply chain, sweatshops, or regulation and fines that people are held to account, and I think that a corporate governance team can help hold management teams to account.  LGIM Corporate Governance is unusual, because we have significant resource. I report directly to the CEO of LGIM, I am on the Board of LGIM as a Director and I think very importantly, we have to two non-Executive Directors who help us manage the conflicts of interest that arise in this industry.