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Proxy voting

December 2016

Voting rights are exercised systematically on all mutual funds managed by Pictet Asset Management’s entities.

Proxy Voting Policy

Our voting policy is based on generally accepted standards of best practice in corporate governance including board compensation, executive remuneration, risk management, shareholder rights.

Long-term interests of shareholders are the paramount objective. We therefore do not always support the management of investee companies and may vote against management from time to time. To assist us in the exercising of proxy votes, Pictet Asset Management uses the services of third party specialists whose expertise and international experience allows us to vote at all relevant company meetings worldwide. Applicable voting guidelines can be found here:

International companies

US companies

The following principles are used in defining the scope of accounts and securities eligible for proxy voting:

  1. For actively managed funds, we aim to vote on 100% of equity holdings.
  2. For passive strategies, we aim to vote on 100% of equity holdings for Swiss index strategies, and on 90% of AUM for other index strategies. Holdings within the 90% threshold are defined once a year although this can be updated more frequently in case of material deviations. For liquidity reasons, voting rights are not exercised in share blocking markets. 
  3. For segregated accounts, including mandates and third-party (ie sub-advisory) mutual funds managed by Pictet Asset Management, clients who delegate the exercise of voting rights to us have the choice between Pictet Asset Management’s policy or their own voting policy. 

For portfolios delegated to third-party asset managers and external funds in which we invest on behalf of our client’s, we expect managers to exercise proxy voting per their own policy and report accordingly to relevant Pictet Asset Management entities.

Proxy Voting Statistics 2016

A summary of Pictet Asset Management’s proxy voting statistics is set out below.

In 2016 Pictet Asset Management voted at 3’033 general assembly meetings. We voted “Against” (“abstained” or “withhold”) to at least one resolution at 1’449 meetings and we were unable to vote at 49 meetings for technical reasons.

Breakdown of votable meetings 
Breakdown of votable meetings
Source: ISS; Pictet Asset Management – December 2016

Out of 36’114 resolutions we voted against management on 3’378 items (9%) and supported management on 32’736 (91%) items. 

Breakdown of votable items 
Breakdown of votable items
Source: ISS; Pictet Asset Management – December 2016
We voted against management on resolutions that relate primarily to director nominations (41%), executive remuneration (21%), routine issues such as approval of accounts and auditors (17%), and other resolutions such as mergers and related party-transactions. 

 Breakdown of votes against management by proposal type (excluding shareholder resolutions)
 Breakdown of votes against management by proposal type
Source: ISS; Pictet Asset Management – December 2016

We supported 565 shareholder resolutions, ie 52% out of 1,077 proposals.

Breakdown shareholder resolutions
Breakdown shareholder resolutions
Source: ISS; Pictet Asset Management – December 2016
The main categories of shareholder resolutions that we supported relate to director nominations (41%), overall governance issues such as issuance of shares and convertible bonds (34%), and other resolutions related to change of company statutes and election of independent board chairman (17%).

Categories of shareholder resolutions that we supported
Categories of shareholder resolutions that we supported
Source: ISS; Pictet Asset Management – December 2016

In 2016, we deviated from ISS voting guidelines on a total of 99 votes. The main categories we deviated were related to director nominations (55%), compensation of executives (24%) and other routine resolutions such as change of company statutes and election of board chairman (17%).

 

Breakdown of deviations from voting guidelines
Breakdown of deviations from votin guideline
Source: ISS; Pictet Asset Management – December 2016