Dr Ian Woods, head of ESG research at AMP Capital says it is sometimes more productive for all concerned to engage with a company about areas of concern.
• Monitoring those small deposits
``For example we have been doing some engagement with retailers on their supply chain and in particular their garment supply chain and use of factories in Bangladesh.
``We are not the only ones who have been talking to the companies on these issues, but certainly when you have an investor saying `look, we really think this is an important issue and want you to manage your supply chain risk, and we think that the Bangladesh Accord [on safe working conditions in the garment industry] is a good thing for you to sign up for', I think that certainly is a positive contribution.''
Climate change is another area where investors are engaging in a public policy discussion, Dr Woods says.
Funds investing over the long term have a stake in how an economy manages the transition that's needed in order to address climate change, and want to be involved in discussions, he says.
Dr Woods says investment managers can ask a fossil fuel company whether its development plans, using shareholder capital, are sound in a post-Paris Conference world, exercising positive pressure to meeting emissions-reduction goals.
They might ask: ``How have you thought about the future given the fact that we have to respond to climate change?''.
