SAUL is first UK scheme to adopt pass-through voting across DC, DB plans

The Superannuation Arrangements of the University of London (SAUL) has become the first UK pension scheme to take up pass-through voting for both its defined contribution (DC) and defined benefit (DB) plans, offered by Legal & General Investment Management (LGIM) and provided by shareholder voting fintech company Tumelo.

The move will allow the scheme to enforce voting preferences on annual general meeting (AGM) resolutions within their pooled fund investments.

The £3bn (€3.5bn) pension scheme for employers associated with the University of London said it is particularly focused on voting for resolutions at the Climate Action 100+ companies, as well as its top 500 holdings.

SAUL follows a similar decision by the £2bn Local Government Pension Scheme (LGPS) for Camden, both of whom are clients of LGIM, highlighting a trend of pension schemes taking action to align their voting across their equities.

Stuart Murphy, head of client platforms at LGIM said: “SAUL’s decision to vote across all their assets including DC is a new development for the market – it will be interesting to see if other DC master trusts also follow this path.”

Greater influence

Traditionally, votes in SAUL’s segregated mandates were cast according to its values through a custom voting policy managed by Pensions & Investment Research Consultants (PIRC), while votes for its pooled funds were controlled by LGIM.

Kevin Wade, SAUL’s chief investment officer, said: “It’s great to see three of our partners, Legal and General, Tumelo and PIRC, working together to help SAUL implement its voting policy across more of our investments. This will also give SAUL more influence and a stronger voice when engaging with portfolio companies.”

By adopting this technology, SAUL can directly influence decisions on issues, such as remuneration and climate change, by voting in line with its responsible investment values in pooled funds.

Georgia Stewart, Tumelo’s chief executive officer, said: “DC pension funds are growing more conscious of their ability to influence the companies their money is invested in. Pass-through voting plays a pivotal role in magnifying their influence, guaranteeing that their investments align with their objectives. From here, the stewardship landscape will only become more complex.”

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