Member Led Initiation

• The Forum will initiate a collective engagement if it meets the criteria set out in the Collective Engagement Framework, and if there is support from a critical mass of shareholders.

• In the process of formulating the engagement strategy, the Forum explores all perspectives, including those of the credit analysts and ESG teams at Member firms in order to agree clear objectives. Once participants have confirmed support for the proposed engagement strategy, the Forum progresses to contacting the company.

What happens next depends on individual circumstances. In the majority of cases, the Investor Forum writes to the Chairman or SID to set out the collective concerns and calls for action. Typically, the Forum would then meet with the Chair, SID or both, along with other company representatives and Board members.

The Forum recognises that change cannot be delivered immediately, and that the company needs to follow due process. Therefore, engagements may involve a period of “monitoring developments” – waiting for the outcome of an appointment process, the conclusions of a review, or for the next set of results to assess the company’s response. The Forum maintains contact with participants, keeps in touch with the company to provide regular input, and re-consults with participants as circumstances change. In the case of Imperial Brands plc, for example, the Forum has had three distinct phases of engagement, with different objectives and targeted outcomes.

• The Forum consults Members before closing an engagement, and then share the Closing Note, which evaluates outcomes against objectives. The Forum seeks feedback from all participants in order to evaluate the value they gained from the process. A high-level summary of the lessons learned is given on pages 12-15 of our Annual Review 2020.