Stewardship is about the exercise of shareholders or investors rights, and on investment managers or asset owners as institutional investors as stewards of capital, and that it is part of fiduciary duty to vote as investors or engage with investee companies with a view to generating value or return from investments to clients or beneficiaries.   There may be different names, such as responsible owner or active ownership, but in essence it is about asset owners and asset managers discharging responsible investment, as stewards of capital. 

Hong Kong Securities and Futures Commission (SFC) published the Principles of Responsible Ownership (HK PRO) in 2016.  The HKPRO was issued with the stated objective to guide and assist investors to determine how best to meet ownership responsibilities, encompassing seven principles, though it is a set of voluntary and non-binding principles.

In our previous publication, Hong Kong Green or ESG Investing & SFC Authorised Funds, we focused on green or ESG investing of Hong Kong licensed investment managers, including a reflection on the results of the SFC ESG Survey, and an overview on the current range of SFC authorised green or ESG funds available for public offer, with reference to the SFC requirements on green or ESG funds, and also the range of investment strategies adopted by such funds.

An important element and commonly cited investment approach in green or ESG investment strategies adopted by green or ESG funds is ‘active ownership’.   In this publication, we focus on stewardship and responsible ownership, current market trends and developments, guidelines and standards, and also consider how managers may adopt and implement stewardship and responsible ownership policies.