Lending equities to brokers, hedge funds and other market participants shouldn’t interfere with shareholder voting, according to a top European institutional investment house.
“We believe securities lending is essential for well-functioning and efficient markets and does not interfere with shareholder engagement with the right processes in place,” Xavier Bouthors, senior portfolio manager, treasury at NN Investment Partners, told Global Investor.
Faryda Lindeman, senior corporate governance specialist at the firm, added: “At NNIP, the environmental, social and governance (ESG) team actively collaborates with the securities lending team to recall and restrict securities from lending to protect voting rights, AGM participation and engagement. Strategic positions would also be restricted from securities lending.”
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