USS wins ICGN’s Global Stewardship Disclosure Award 2022

We were delighted to receive the ICGN’s Global Stewardship Disclosure Award 2022 (for asset owners above £60bn) for our full range of disclosures, particularly our Stewardship Code Report, full and summary TCFD Reports and our web content. This demonstrates our commitment to Responsible Investment, our important work in this area, and our approach to transparency.

We’re also proud to retain our signatory status to the FRC’s Stewardship Code (which comprises a set of 12 ‘apply and explain’ Principles for asset managers and asset owners). We were highlighted as an exemplar in their Review of Stewardship Reporting 2022 for the way in which we set clear expectations and build capacity at external investment managers. They commended the inclusion of two case studies which demonstrate how we hold our asset managers to account in private equity and private credit.

The FRC assesses all reports against each of the Stewardship Code’s 12 Principles, and their feedback is a vital component in improving our stewardship reporting year-on-year. In our 2022 outcome letter, the FRC acknowledged the improvements we’d made to our report that had addressed their 2021 feedback. They welcomed the risk scenarios we identified and reported on under Principle 4, for example, and noted that our case studies on engagement (Principle 9) were more detailed than in 2021, having clear objectives, actions, and outcomes. The FRC also set out particular areas we will need to address in order to remain signatories to the Code in future. These were:

• Building on the disclosure of our risk scenarios by outlining the processes and inputs that helped us identify these
• Reference asset classes beyond equities under Principle 12, which could be achieved by linking to other sections where we describe our influence in private markets and credit; and
• Continue to report case studies in this level of detail in our 2023 Stewardship Code Report.

We are now turning our attention to our 2023 reporting, and we know that the FRC will be focusing on how we report on our progress, along with an increasingly rigorous emphasis on outcomes of our stewardship activities. In addition, they will be expecting a greater number and wider breadth of examples and case studies, and these should include both quantitative and qualitative information. Alongside this, we will also be producing our second mandatory TCFD Report, which will once again be published with the Annual Report & Accounts this summer.

As we said last year, we believe these reports give a compelling account of how we seek to be an agent of positive change for the benefit of both current and future members and wider society, but reporting must not detract us from the need to continue to take action on ESG issues. Our Net Zero ambition remains a central component of our strategy and we look forward to giving an update on our progress in our 2023 reports.