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Coutts passes tough test from UK accounting regulator on how it invests responsibly for clients
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Our work ensuring our investment services help clients contribute to a more sustainable future has met the high standards of a new nationwide stewardship code.
We passed a robust, rigorous assessment by regulator the Financial Reporting Council (FRC) to become one of the first companies to sign up to the revised UK Stewardship Code.
The code outlines how those investing for British savers and pensioners should “create long-term value for clients and beneficiaries leading to sustainable benefits for the economy, environment and society”.
Sir Jon Thompson, CEO of the FRC, said it was “recognised globally as a best-practice benchmark in investment stewardship”. A third of the 189 firms that applied failed to make the list, showing how good you need to be at responsible investing to impress the regulator.
AN INVESTMENT NO-BRAINER
Leslie Gent, Head of Responsible Investing at Coutts, said: “This independent approval for our work building a better future provides further evidence to our clients that they’re benefitting the environment and society as they attempt to grow their wealth. And all at no extra cost to them and with no compromise on returns.
“The fact that the standards we had to meet were so high shows just how seriously people now take our planet’s most pressing issues – not just clients, but governments and industry bodies too.”
She added: “The importance of getting this right is a no-brainer for us. We work to provide sustainable, long-term returns for our investment clients. We can only achieve that in a world with a sustainable future.”
PROVING OUR WORTH AROUND 12 KEY PRINCIPLES
To meet the required standard for the code, Coutts had to show hard evidence that it was taking tangible action around 12 key principles. These include:
- managing conflicts of interest to put the best interests of clients and beneficiaries first
- identifying and responding to market-wide and systemic risks to promote a well-functioning financial system
- systematically integrating stewardship and investment, including material environmental, social and governance issues, and climate change, to fulfil our responsibilities
The full list and more detail can be seen on the FRC website.
The UK Stewardship Code was first published in July 2010, but has been revised and updated since. Coutts first signed up to it in 2017, achieving the highest score (Tier 1) for our activity. This new code has been updated with the 12 principles and greater demands for more detailed evidence.
The FRC regulates auditors, accountants and actuaries, and sets the UK’s corporate governance and stewardship codes. Its work is aimed at investors and others who rely on company reports, audit and high-quality risk management.
Coutts responsible investing practices also won three awards earlier this year – at the Sustainable Investing Awards 2021 and WealthBriefing European Awards. Judges called us “a comfortable winner”.
When investing, the value of your investments, and the income you receive from them, can go down as well as up and you may not get back as much as you invested.