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Business practices and voting information
As part of our commitment to delivering superior investment performance to our clients, we expect and encourage the companies in which we invest to demonstrate the highest standards of corporate governance and best business practice.
We examine the share structure and voting structure of the companies in which we invest, as well as the board balance, oversight functions and remuneration policy. These analyses then form the basis of our proxy voting and engagement activity.
J.P. Morgan Asset Management Voting Policy and Corporate Guidelines
Guidelines for portfolios managed within the UK
Guidelines for portfolios managed outside the UK
Proxy voting: UK and Europe Q1 2018
JPMAM manages the voting rights of the shares entrusted to it as it would manage any other asset. It is the policy of JPMAM to vote in a prudent and diligent manner, based exclusively on our reasonable judgement of what will best serve the financial interests of our clients. So far as is practicable, we will vote at all of the meetings called by companies in which we are invested.
Summary of key voting statistics
Meetings voted (UK):
Meetings voted (EUR):
Votes with management:
Votes against management:

*a further 7 meetings were not voted due to share blocking and/or conflicts of interest (voting in relation to JPM Funds)

The first quarter sees voting volumes in the UK and Europe start to increase as we head into the peak AGM season in April/May.

  • Victrex plc announced in February that non-executive director Andrew Dougal had decided to resign and would not seek re-election at the company's annual general meeting, due to shareholder concern over his involvement in Carillion plc, which went into liquidation in 2017. Shareholders, including J.P. Morgan Asset Management, had indicated they would vote against Dougal’s re-election were he to stand. Dougal joined Carillion in 2011 and chaired its Audit Committee, responsible for overseeing the financial reporting process, selection of auditor, and receipt of audited results. Separately, the UK Financial Reporting Council (FRC) has announced that it has started an investigation into two former Carillion finance directors, and is also investigating KPMG’s audit of Carillion’s financial statements.
  • J.P. Morgan Asset Management also voted against the Chairman and five directors at Mitchells & Butlers plc , due to a continued lack of compliance with the recommendations of the UK Corporate Governance Code relating to board and committee composition. This results from the presence of four shareholder representatives on the board, who also serve on key committees. Keith Browne and Eddie Irwin both represent Elpida Group, which owns 23.42%. Irwin sits on the Audit and Remuneration Committees, which should be fully independent under the UK Corporate Governance Code. Similarly, Josh Levy and Ron Robson both represent Piedmont, which owns 26.74%. Levy sits on the Remuneration Committee, and Robson sits on the Audit Committee. J.P. Morgan Asset Management also voted against Chairman Bob Ivell who, as Board Chairman, is ultimately responsible for corporate governance at the company, where only four out of eleven board members meet our independence criteria.
  • J.P. Morgan Asset Management also voted against both the Remuneration Report and the Remuneration Policy at Centamin plc, due to substantial concerns over the company's pay practices, which have not improved, despite a significant protest vote against the remuneration report at the 2017 AGM (23.5%). The company proposed increasing annual bonus payouts at target performance, which are settled entirely in cash with no deferrals; there is also a lack of clarity around the weighting of financial objectives, where the company has historically assigned a relatively low weighting (less than 50%) to financial metrics in the operation of the scheme. The shareholding requirement for executives is also low compared to peers at 150% of salary. In the event, the Remuneration Report received a 31.91% vote against, and the Remuneration Policy was rejected by shareholders, with 52.01% voting against. Due to Centamin’s incorporation in Jersey, the Remuneration Policy vote, which is binding in the UK, was advisory only, although the company has stated that it will “continue to proactively consult with shareholders […] to ensure their feedback is better understood and implemented where appropriate”.
  • In Europe, J.P. Morgan Asset Management voted against related-party transactions and remuneration at Derichebourgin France. Unusually, the company's Chairman and CEO Daniel Derichebourg receives his remuneration as a percentage of profit-sharing allocation (known as tantièmes) from DBG Finances, the company's controlling shareholder, rather than the company itself. Similarly, the remuneration of the vice-CEO, Abderrahmane El Aoufir, is set and paid by Coframetal, a wholly-owned subsidiary. These arrangements have the potential to create a conflict of interest in our view. The company does disclose a limited remuneration policy for both the Chairman and CEO, and vice-CEO, but disclosure of the performance conditions attached to the bonus are vague and the company does not disclose any cap, weighting or achievement levels for the performance conditions attached to the bonus allocation, which showed a 40% increase compared to last year. Furthermore, the company has no long-term incentive arrangements, and does not maintain a Remuneration Committee. The company is controlled by the Derichebourg family, which owns approximately 40% of the company's share capital, but controls 57% of the votes, thanks to double voting rights.
  • J.P. Morgan Asset Management voted against remuneration at Aurubis in Germany, as the Supervisory Board continues to have a high level of discretion with regard to overall pay “to account for exceptional performance that is not covered by the regular compensation“. Despite introducing a new compensation system this year, two-thirds of the management board (including the CEO) are still subject to the old compensation system, which guarantees bonuses and lacks disclosure in relation to its variable components. More positively, the new compensation system demonstrates much enhanced disclosure in relation to ex-ante performance targets, which is notably above average for the German market.
  • J.P. Morgan Asset Management met 19 companies to discuss corporate governance and strategy issues, in addition to our scheduled one-to-one meetings. Companies included Rio Tinto, Unilever, Nestlé, Prudential, Société Générale, Banco Santander and Total.
  • Year-to-date, J.P. Morgan Asset Management has engaged with 29 companies in the UK and Europe on ESG issues (not counting scheduled one-to-one meetings). Of these, 11 were meetings to discuss corporate governance issues at portfolio companies, 10 were consultations over remuneration arrangements, and 6 were in relation to social or environmental issues.

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J.P. Morgan