The Devon Pension Fund places a strong emphasis on the rights and responsibilities that attach to being a shareholder and will play an active role in overseeing the management of the companies in which it invests.

Companies that are well managed with a sustainable business model are more likely to achieve the investment returns that the Fund requires. The Fund will therefore seek to engage in collaboration with the Brunel Pension Partnership and its fund managers and other partners to promote good management and sustainable business models, and use its votes at company meetings accordingly.

UK Stewardship Code 2021 Logo In March 2022 the Fund was accredited by the Financial Reporting Council as a signatory to the UK Stewardship Code 2020. This follows an assessment of the Fund’s stewardship and engagement policies and activity reported in the Pension Fund Annual Report for 2020/21.

The revised Code (the Code) sets high stewardship standards for asset owners and asset managers, and for service providers that support them.

Company Engagement

A breakdown of the number of companies engaged with by Brunel on behalf of the Devon Fund during each quarter over the last year, by region and the type of issues engaged on is shown in the following charts:

Number of Companies Engaged With, By Region

April to June 2021 UK 57, Europe Ex UK 120 , North America 23,0 Asia Pacific (incl. Japan) 84 , Emerging Markets 48

July to September 2021 UK 32 Europe Ex UK 43 North America 73 Asia Pacific (incl. Japan) 30 Emerging Markets 17 October to December 2021 UK 34 Europe Ex UK 56 North America 87 Asia Pacific (incl. Japan) 45 Emerging Markets 28 January to March 2022 UK 24 Europe Ex UK 73 North America 130 Asia Pacific (incl. Japan) 45 Emerging Markets 28

Breakdown of Issues Engaged On

Voting Activity

Voting on the Fund’s equity shares is delegated to the Brunel Pension Partnership, and for the Fund’s passive investments to Legal and General Investment Management (LGIM). The Devon Fund requires that Brunel will always seek to exercise its rights as shareholders through voting on all resolutions at company general meetings.

Brunel actively vote the shares held within their funds on behalf of their client funds, including Devon. For the passive equity allocation Legal and General Investment Management (LGIM) manage the investments and voting on the shares is delegated to them. On significant issues, Brunel may request that their shares are split out and a different vote made. The votes cast by the Fund’s investment managers during the year in respect of the Devon Fund’s investments are set out in the table below. The passive portfolios managed by LGIM are shown separately from Brunel’s voting on active portfolios.

Manager / Portfolios Number of Meetings Number of Resolutions Votes Against Management
Brunel Passive Portfolios (LGIM) 3,867 51,632 8,715
Brunel Active Portfolios 863 9,945 1,715
RWC Partners 13 187 9

The passive portfolios will include all the companies in the relevant indexes, so there will be more meetings and more resolutions to vote on than for the actively managed portfolios. The votes against management recommendations will reflect matters where there is concern that the company is not addressing the issue concerned and managing it effectively. The Devon Fund would expect that these votes against management should be primarily on the priority areas set out in the Fund’s Investment Strategy Statement. An analysis of the issues where votes have been cast against management recommendations is set out below.

Votes Cast Against Management Recommendation by Issue 2021/22