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href="/content/cfs-winged/au/en/super/super-contributions.html"> <span>Super boosting strategies</span> </a> </li> <li class="Header__SubMenuItem"> <a class="Header__SubMenuLink" href="/content/cfs-winged/au/en/personal/resources/faqs.html#retirement"> <span>Retirement FAQs</span> </a> </li> <li class="Header__SubMenuItem" data-level="1" data-has-children="true"> <a data-cmp-hook-header="mobileMenuItem" data-target-id="-Entering your retirement" href="/content/cfs-winged/au/en/personal/retirement/entering-retirement.html" class="Header__SubMenuHeading"> <span>Entering your retirement</span> <!-- <i class="iconfont-chevron-down" aria-hidden="true" data-sly-test="true"></i> --> </a> </li> <!-- Second Leavel Expanding the thirdlevel items in the second level --> <li class="Header__SubMenuItem"> <a class="Header__SubMenuLink" href="/content/cfs-winged/au/en/personal/retirement/account-based-pension.html"> <span>What is an account-based pension?</span> </a> </li> <li 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class="Header__SubMenuHeading"> <span>Enjoying your retirement</span> <!-- <i class="iconfont-chevron-down" aria-hidden="true" data-sly-test="true"></i> --> </a> </li> <!-- Second Leavel Expanding the thirdlevel items in the second level --> <li class="Header__SubMenuItem"> <a class="Header__SubMenuLink" href="/content/cfs-winged/au/en/retirement/manage-your-pension.html"> <span>Manage your pension</span> </a> </li> <li class="Header__SubMenuItem"> <a class="Header__SubMenuLink" href="/content/cfs-winged/au/en/retirement/taxation-in-retirement.html"> <span>Tax saving strategies</span> </a> </li> <li class="Header__SubMenuItem"> <a class="Header__SubMenuLink" href="/content/cfs-winged/au/en/personal/retirement/retirement-income-planning-guide.html"> <span>Income streams</span> </a> </li> <li class="Header__SubMenuItem"> <a class="Header__SubMenuLink" href="/content/cfs-winged/au/en/retirement/nominate-a-beneficiary.html"> <span>Nominate a beneficiary</span> </a> </li> <!-- <sly 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aem-Grid--12 aem-Grid--default--12 aem-Grid--phone--12 "> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-1096c129db" class="cmp-text"> <h4 style=" text-align: center; ">We believe in being an &#39;active owner&#39; to ensure your investment is contributing to sustainable, long-term wealth generation.</h4> </div> </div> </div> </div> </div> </div> </div> <div class="container responsivegrid aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="container" id="container-7dab55542e" data-overlap-top="0" data-overlap-bottom="0" class=" container container--padding-top-xs container--padding-bottom-md container--padding-right-none container--padding-left-none container--row-spacing-sm container--gridGutters-on container--mobile-order-0 background-- "> <div class="margin"> <div class="wrapper"> <div class="aem-Grid aem-Grid--12 aem-Grid--default--12 aem-Grid--phone--12 "> <div class="anchorlinks aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--10 aem-GridColumn aem-GridColumn--offset--phone--1 aem-GridColumn--default--8 aem-GridColumn--offset--default--2"> <div class="AnchorLinks" data-cmp-is="anchorLinks"> <div class="AnchorLinks__Container"> <div class="AnchorLinks__Content"> <h4 class="AnchorLinks__Heading">On this page</h4> <ul class="AnchorLinks__List"> <li class="AnchorLinks__Item"> <a href="#engagment" class="AnchorLinks__Link">Engagement</a> </li> <li class="AnchorLinks__Item"> <a href="#proxy-voting" class="AnchorLinks__Link">Proxy voting</a> </li> <li class="AnchorLinks__Item"> <a href="#exclusions" class="AnchorLinks__Link">Exclusions</a> </li> </ul> </div> </div> </div> </div> </div> </div> </div> </div> </div> <div class="container responsivegrid aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="container" id="container-a05ec11886" data-overlap-top="0" data-overlap-bottom="0" class=" container container--padding-top-md container--padding-bottom-lg container--padding-right-none container--padding-left-none container--row-spacing-sm container--gridGutters-on container--mobile-order-0 background--grey-4 "> <div class="margin"> <div class="wrapper"> <div class="aem-Grid aem-Grid--12 aem-Grid--default--12 aem-Grid--phone--12 "> <div class="title aem-GridColumn--default--none aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2"> <div id="title-270934c95e" class="cmp-title"> <h4 class="cmp-title__text text--left colour-- h4">What is an &#39;active owner&#39;?</h4> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-a3b469dae9" class="cmp-text"> <p style=" text-align: left; "><span class="p2"><span class="colour--grey-1">We have a responsibility to allocate your capital to productive purposes in the pursuit of sustainable, long-term investment. As a result, we believe it is part of our stewardship role to make sure we exercise our rights as shareholders. These include engagement with, and voting on, how a company operates its business, and we may delegate these actions to either our managers or another third party. Occasionally, these active owner processes will be inadequate to achieve satisfactory outcomes and, in some instances, we may decide the best option is to divest from the investment altogether.</span></span></p> </div> </div> </div> </div> </div> </div> </div> <div class="container responsivegrid aem-GridColumn--default--none aem-GridColumn aem-GridColumn--default--12 aem-GridColumn--offset--default--0"> <div data-cmp-is="container" id="container-16ae454341" data-overlap-top="0" data-overlap-bottom="0" class=" container container--padding-top-md container--padding-bottom-lg container--padding-right-none container--padding-left-none container--row-spacing-xs container--gridGutters-on container--mobile-order-0 background-- "> <div class="margin"> <div class="wrapper"> <div class="aem-Grid aem-Grid--12 aem-Grid--default--12 aem-Grid--phone--12 "> <div class="title aem-GridColumn aem-GridColumn--default--12"> <div id="engagment" class="cmp-title"> <h3 class="cmp-title__text text--center colour-- h3">Engagement</h3> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-5 "> </div> </div> <div class="title aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="title-90f6fe5c6d" class="cmp-title"> <h4 class="cmp-title__text text--left colour-- h4">Why engage with a company?</h4> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-f0f774efe4" class="cmp-text"> <p><span class="colour--grey-1"><span class="p2">We believe that the purpose of engagement is to provide feedback and signal concerns to companies about issues that will affect long term company performance. We view company engagement as the first step to affecting positive change. Engagement discussions may cover &#39;how&#39; the company is operating, &#39;why&#39; it chooses to operate in that way and &#39;what&#39;, if anything it will change to satisfy the concerns of investors.</span></span></p> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-6 "> </div> </div> <div class="title aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="title-0641aac58f" class="cmp-title"> <h4 class="cmp-title__text text--left colour-- h4">Which managers engage with companies?</h4> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-5a66987a4e" class="cmp-text"> <p><span class="colour--grey-1"><span class="p2">The degree to which our investment managers may engage with companies will depend on the strategy and nature of their investment process. On top of engagements that our investment managers may undertake, CFS may choose to engage with companies according to the engagement plan across all our holdings.</span></span></p> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-6 "> </div> </div> <div class="title aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="title-ad644c7b14" class="cmp-title"> <h4 class="cmp-title__text text--left colour-- h4">How does CFS engage with a company?</h4> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-84365c220f" class="cmp-text"> <p><span class="colour--grey-1"><span class="p2">To assist us with our engagement of global investee companies, CFS has appointed a stewardship provider, <a title="EOS at Federated Hermes" data-tracker-locationid="cfs | text3-eosatfederatedhermes" href="https://www.cfs.com.au/content/dam/colonial-first-state/docs/about-us/responsible-investing/EOS-at-Federated-Hermes.pdf" target="_blank" rel="noopener noreferrer">EOS at Federated Hermes</a>. With our engagement framework in mind, EOS will engage with companies on our behalf and keep us informed of their progress. <br /> </span></span></p> <p><span class="colour--grey-1"><span class="p2"> </span></span></p> <p><span class="colour--grey-1"><span class="p2">If you would like to read more about the engagements undertaken throughout 2023, please see our <a title="Annual engagement report" href="https://www.cfs.com.au/content/dam/colonial-first-state/docs/about-us/responsible-investing/annual-review-cfs-2023-public.pdf" target="_blank" data-tracker-locationid="cfs | text3-cfstext3annualengagementreport" rel="noopener noreferrer">Annual engagement report</a>. </span></span></p> <p> </p> <p><span class="p2"><span class="colour--grey-1">As a result of our monitoring or widespread public concern, we may encourage our investment managers to engage with the company management or collaborate with other investors in an engagement. These issues may relate to climate change, human rights, environmental and resource management amongst others.<br /> <br /> As a PRI signatory, we also use the PRI’s collaboration platform, a global online tool for collaborative initiatives, as well as being involved in several industry wide initiatives. </span></span></p> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2"> </div> </div> </div> </div> </div> </div> <div class="container responsivegrid aem-GridColumn--default--none aem-GridColumn aem-GridColumn--default--12 aem-GridColumn--offset--default--0"> <div data-cmp-is="container" id="container-a6b40b79f8" data-overlap-top="0" data-overlap-bottom="0" class=" container container--padding-top-md container--padding-bottom-lg container--padding-right-none container--padding-left-none container--row-spacing-xs container--gridGutters-on container--mobile-order-0 background--grey-4 "> <div class="margin"> <div class="wrapper"> <div class="aem-Grid aem-Grid--12 aem-Grid--default--12 aem-Grid--phone--12 "> <div class="title aem-GridColumn aem-GridColumn--default--12"> <div id="proxy-voting" class="cmp-title"> <h3 class="cmp-title__text text--center colour-- h3">Proxy voting</h3> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-5 "> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-f9938362dc" class="cmp-text"> <p><span class="p2"><span class="colour--grey-1">Exercising your right to vote as a shareholder goes hand-in-hand with engagement as a method to influence how a company operates its business.</span></span> </p> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-5 "> </div> </div> <div class="title aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="title-935f7d5f4e" class="cmp-title"> <h4 class="cmp-title__text text--left colour-- h4">Why vote at a company meeting?</h4> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-5054b05fb4" class="cmp-text"> <p><span class="p2"><span class="colour--grey-1">From time to time, and at least annually, companies seek shareholder approval for a variety of issues. This important shareholder activity ensures the companies you’re invested in are operating appropriately. When the responsibility to vote on behalf of the shareholder is delegated to someone it is known as a proxy vote.<br /> At CFS we believe active ownership can lead to better long term returns and so we have appointed a third–party proxy adviser to help us vote on the global equities held on your behalf. They will make recommendations on how to vote but the final decision will rest with CFS, to ensure it is in the best interest of all our customers.<br /> This will provide our customers with transparency on voting on resolutions and improve the consistency of how CFSIL is voting for most of the non-Australian equities held.<br /> Our managers will continue to vote on our (and your) behalf for the Australian equity holdings.</span></span></p> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-6 "> </div> </div> <div class="title aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="title-9ccae21015" class="cmp-title"> <h4 class="cmp-title__text text--left colour-- h4">What kind of issues are voted on?</h4> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-cf65dad314" class="cmp-text"> <p><span class="p2"><span class="colour--grey-1">Voting enables investors to have a say in the key strategic decisions of a company.<br /> Where engagement with the company has not had the desired effect, investors can raise or support shareholder resolutions (for example on climate risk disclosure or human rights issues in a company’s supply chain).<br /> Voting on these issues ensures a company is being governed in shareholders&#39; interests, that company management is behaving appropriately and that company risks are being managed effectively – all key to sustainable, long-term investment.</span></span></p> <p><span class="p2"><span class="colour--grey-1"> </span></span></p> <p><span class="p2"><span class="colour--grey-1">To assist us with our proxy voting duties, CFS has appointed a third–party proxy adviser to collate votes on company resolutions and to provide voting recommendations for most of the non-Australian listed companies we invest in. This will enable us to provide you with transparency and improve the consistency of how CFS is voting for most of the non-Australian companies held.</span></span></p> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-6 "> </div> </div> <div class="title aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="title-869f71a093" class="cmp-title"> <h4 class="cmp-title__text text--left colour-- h4">Do we know how votes have been cast?</h4> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-644de54f40" class="cmp-text"> <p>Our voting records from 1 January 2022 are available by clicking on the link below. This allows us to keep you informed on how votes have been cast across all CFS FirstChoice holdings in the most timely manner. </p> <p> </p> <p><a href="https://vds.issgovernance.com/vds/#/ODI2NzA0" target="_blank" title="VDS Dashboard (issgovernance.com) " data-tracker-locationid="cfs | text4-vdsdashboardissgovernancecom" rel="noopener noreferrer">VDS Dashboard (issgovernance.com)</a></p> <p> </p> <p>For further information on how to use this tool be please see the guide &#39;<a data-tracker-locationid="cfs | text4-cfstext4howtoreadthevdsdashboard" href="https://www.cfs.com.au/content/dam/prospects/fs/8/0/fs8020.pdf" target="_blank" title="How to read the VDS Dashboard" rel="noopener noreferrer">How to read the VDS Dashboard</a>&#39;. </p> </div> </div> </div> </div> </div> </div> </div> <div class="container responsivegrid aem-GridColumn--default--none aem-GridColumn aem-GridColumn--default--12 aem-GridColumn--offset--default--0"> <div data-cmp-is="container" id="exclusions" data-overlap-top="0" data-overlap-bottom="0" class=" container container--padding-top-md container--padding-bottom-lg container--padding-right-none container--padding-left-none container--row-spacing-xs container--gridGutters-on container--mobile-order-0 background-- "> <div class="margin"> <div class="wrapper"> <div class="aem-Grid aem-Grid--12 aem-Grid--default--12 aem-Grid--phone--12 "> <div class="title aem-GridColumn aem-GridColumn--default--12"> <div id="title-819af8655b" class="cmp-title"> <h3 class="cmp-title__text text--center colour-- h3">Our exclusions</h3> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-5 "> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-82d2b00c67" class="cmp-text"> <p><span class="colour--grey-1"><span class="p2">We recognise that within a diverse group of individuals there will be various ethical beliefs and values that will shape the approach to investing.<br /> <br /> In general, we will not take a position on, or make judgement of, an ethical or socially responsible issue unless it is specific to our investment strategy. However, there may be some ESG risks, ethical issues and circumstances in which we believe it is appropriate to take action, whether that’s through the use of negative screens, exclusions or active engagement with our investment managers. These decisions are not made lightly, and before doing so, we aim to first influence company behaviour through other means. See our </span></span><span class="p2"><a data-tracker-locationid="cfs | text1-cfstext1engagement" href="/content/cfs-winged/au/en/about-us/corporate-profile/responsible-investment/active-ownership.html#engagement"><span class="colour--grey-1">engagement</span></a> </span><span class="colour--grey-1"><span class="p2">and </span></span><span class="p2"><a data-tracker-locationid="cfs | text1-cfstext1proxyvoting" href="/content/cfs-winged/au/en/about-us/corporate-profile/responsible-investment/active-ownership.html#proxy"><span class="colour--grey-1">proxy voting</span></a></span><span class="colour--grey-1"><span class="p2"> approaches for further information.</span></span></p> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-5 "> </div> </div> <div class="title aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="title-6fab2c6a02" class="cmp-title"> <h4 class="cmp-title__text text--left colour-- h4">How do we decide if an exclusion is required?</h4> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-967efb646d" class="cmp-text"> <p><span class="p2"><span class="colour--grey-1">During the regular monitoring of your investments, there are many questions that concern us. The following need to be asked if we are considering an exclusion:</span></span></p> <ul><li><span class="p2"><span class="colour--grey-1">Does the investment contravene global norms, international treaties or conventions?<br /> <br /> </span></span></li><li><span class="p2"><span class="colour--grey-1">How severe and/or material is the ESG risk?<br /> <br /> </span></span></li><li><span class="p2"><span class="colour--grey-1">Can the company or its activities be influenced through <a data-tracker-locationid="cfs | text2-engagement" href="/content/cfs-winged/au/en/about-us/corporate-profile/responsible-investment/active-ownership.html#engagement">engagement</a> and/or <a data-tracker-locationid="cfs | text2-proxyvoting" href="/content/cfs-winged/au/en/about-us/corporate-profile/responsible-investment/active-ownership.html#proxy">proxy voting</a>?<br /> <br /> </span></span></li><li><span class="p2"><span class="colour--grey-1">Will this investment achieve sustainable, long-term wealth protection?</span></span></li></ul> <p><span class="p2"><span class="colour--grey-1">If we decide that the risk is great enough to warrant exclusion, we must be satisfied that your investment is not unduly affected. The following need to be answered satisfactorily:</span></span></p> <ul><li><span class="p2"><span class="colour--grey-1">Will your investment still be adequately diversified?<br /> <br /> </span></span></li><li><span class="p2"><span class="colour--grey-1">Will the investment objectives still be met?</span></span></li></ul> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; --custom-sm: px; --custom-md: px; --custom-lg: px; --custom-xl: px; " class=" Spacer Spacer--type-manual Spacer--preset-md Spacer--direction-vertical Spacer--size-xs-inherit Spacer--size-sm-inherit Spacer--size-md-inherit Spacer--size-lg-inherit Spacer--size-xl-6 "> </div> </div> <div class="title aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn--default--9 aem-GridColumn aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="title-60fa0b5733" class="cmp-title"> <h4 class="cmp-title__text text--left colour-- h4">What are our FirstChoice exclusions?</h4> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-b5178466c2" class="cmp-text"> <p>CFS has two investment exclusions in place across all FirstChoice portfolios. These are exclusions against controversial weapons manufacturers and tobacco producers.   </p> <p> </p> <p>Due to the labour, environmental and social risks associated with the production of tobacco and manufacture of controversial weapons, we do not allow investment managers to invest in equity and debt securities<sup>1</sup> issued by companies who are involved in these practices. Whilst we make every endeavour to exclude these companies, there may, from time to time, be unintended exposure due to lack of data, corporate activity, indirect exposure or exposure through index derivatives or third party managed pooled unit trusts.  </p> <p> </p> <p>For publicly listed assets we rely on third party data<sup>2</sup> to assist in creating and monitoring our exclusion list. For private assets, our investment managers assess the exclusions individually and CFS will monitor on a best endeavour basis.  </p> <p> </p> <p>From December 2019, Colonial First State will not invest in equity and debt securities1 issued by companies that are manufacturing controversial weapons and tobacco producers. The list of companies is reviewed and updated each calendar year. <a data-tracker-locationid="cfs | -ourcurrentexclusionlistcanbeviewedhere" href="https://www.cfs.com.au/content/dam/prospects/fs/7/2/fs7278.pdf" target="_blank" rel="noopener noreferrer">Our current exclusion list can be viewed here.</a><sup>3</sup>  </p> </div> </div> <div class="accordion panelcontainer aem-GridColumn--default--none aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2"> <div data-cmp-is="cfsAccordion" data-deeplinking="true" data-placeholder-text="false" id="accordion-a7d86a7f88" class=" Accordion Accordion--heading-alignment-center Accordion--theme-light Accordion--style-plus_right "> <div class="Accordion__ItemList"> <div class="Accordion__Item"> <button class="Accordion__ItemHeader" id="accordion-a7d86a7f88-item-11f17807c9-header" data-title="What are controversial weapons?"> <div class="Accordion__ItemHeaderIcon"> <i class="iconfont-chevron-up" aria-hidden="true"></i> <i class="iconfont-chevron-down" aria-hidden="true"></i> </div> <div class="Accordion__ItemHeaderTitle p2">What are controversial weapons?</div> </button> <div class="Accordion__ItemPanel" id="accordion-a7d86a7f88-item-11f17807c9-panel" role="region" aria-labelledby="accordion-a7d86a7f88-item-11f17807c9-header"> <div class="Accordion__ItemPanelWrapper"> <div class="Accordion__ItemPanelContent"> <div data-cmp-is="container" id="container-11f17807c9" data-overlap-top="0" data-overlap-bottom="0" class=" container container--padding-top-none container--padding-bottom-none container--padding-right-none container--padding-left-none container--row-spacing-none container--gridGutters-on container--mobile-order-0 background-- "> <div class="aem-Grid aem-Grid--8 aem-Grid--default--8 "> <div class="text aem-GridColumn aem-GridColumn--default--8"> <div id="text-bf13ed4a5f" class="cmp-text"> <p>There is no universally accepted definition of controversial weapons. Typically, they are those that indiscriminately kill or disproportionately harm people. Through normal use, these weapons may kill civilians as well as military targets (including after conflict has ended) thus their use is prohibited and breaches global conventions on human rights.  </p> <p> </p> <p>CFS defines controversial weapons manufacturers as any company engaged in the manufacture of chemical and biological weapons, cluster munitions<sup>4</sup>, antipersonnel landmines, depleted uranium ammunition, non-detectable fragments, incendiary weapons<sup>5</sup> and blinding lasers.  </p> </div> </div> </div> </div> </div> </div> </div> </div> <div class="Accordion__Item"> <button class="Accordion__ItemHeader" id="accordion-a7d86a7f88-item-d30ad25050-header" data-title="Why tobacco producers?"> <div class="Accordion__ItemHeaderIcon"> <i class="iconfont-chevron-up" aria-hidden="true"></i> <i class="iconfont-chevron-down" aria-hidden="true"></i> </div> <div class="Accordion__ItemHeaderTitle p2">Why tobacco producers?</div> </button> <div class="Accordion__ItemPanel" id="accordion-a7d86a7f88-item-d30ad25050-panel" role="region" aria-labelledby="accordion-a7d86a7f88-item-d30ad25050-header"> <div class="Accordion__ItemPanelWrapper"> <div class="Accordion__ItemPanelContent"> <div data-cmp-is="container" id="container-d30ad25050" data-overlap-top="0" data-overlap-bottom="0" class=" container container--padding-top-none container--padding-bottom-none container--padding-right-none container--padding-left-none container--row-spacing-none container--gridGutters-on container--mobile-order-0 background-- "> <div class="aem-Grid aem-Grid--8 aem-Grid--default--8 "> <div class="text aem-GridColumn aem-GridColumn--default--8"> <div id="text-2614c7a2f5" class="cmp-text"> <p>Tobacco production causes many environmental, social and economic risks. The tobacco industry is a large employer of child labour and contributor to <a data-tracker-locationid="cfs | -modernslavery" href="/content/cfs-winged/au/en/about-us/responsible-investing/modern-slavery.html">modern slavery</a> through bonded labour<sup>6</sup> . It is estimated by the International Labour Organisation (ILO) that 1.3 million children are employed worldwide in the sector.<sup>7</sup> Environmental damages caused by the tobacco industry include deforestation, soil degradation by land clearing, and land and water pollution due to the extensive use of pesticides and chemicals in the agricultural and manufacturing process. From a social perspective, the product is a highly addictive drug and causes death. There is no safe level of use or exposure as death, disease and health issues arise from primary and secondary consumption.8  </p> <p> </p> <p>CFS defines tobacco producers as any company that is engaged in the production or manufacture of tobacco and tobacco related products. This includes but is not limited to companies that manufacture tobacco products, such as cigars, blunts, cigarettes, e-cigarettes, inhalers, beedis, kreteks, smokeless tobacco, snuff, snus, dissolvable and chewing tobacco. This also includes companies that grow or process raw tobacco leaves.  </p> <p> </p> <p>Investment in tobacco contravenes three major international treaties, conventions and sets of global norms principles. These include the UN Global Compact (UNGC), the UN Guiding Principles on Business and Human Rights, and the World Health Organisation Framework Convention on Tobacco Control (FCTC).  </p> </div> </div> </div> </div> </div> </div> </div> </div> </div> </div> </div> <div class="text aem-GridColumn--default--none aem-GridColumn--phone--none aem-GridColumn--phone--12 aem-GridColumn aem-GridColumn--default--8 aem-GridColumn--offset--default--2 aem-GridColumn--offset--phone--0"> <div id="text-1e3863953e" class="cmp-text"> <p> </p> <p><sup>1. The list of companies provided is of the parent company only. There may be subsidiaries that sit under the parent company that are not highlighted in the list above. CFSIL as a Responsible Entity has instructed Investment managers not to purchase or hold a short position in equity or debt securities (or single name derivatives that would otherwise provide effective exposure to the excluded securities) issued by the above companies or their subsidiaries. Whilst we make every endeavour to exclude these companies, there may, from time to time, be a small level of unintended exposure due to lack of data, corporate activity, indirect exposure or exposure through  index derivatives or third party managed pooled unit trust.  If CFSIL discovers it is holding an excluded security, they will instruct the manager to sell down in an orderly manner.  </sup></p> <p><sup>2. We rely on our third party data provider, MSCI, for its data and methodology when making decisions around the exclusions.  </sup></p> <p><sup>3. Note that the stated exclusions do not apply to cash, derivative instruments, exchange traded funds and pooled unit trusts.  </sup></p> <p><sup>4. Cluster Munitions Manufacturers definition excludes ‘Delivery Platforms’  </sup></p> <p><sup>5. Incendiary Weapons are defined as per ‘The Convention on Certain Conventional Weapons of 1980 under Protocol 3’.  </sup></p> <p><sup>6. Human Rights Watch, 2018, &#39;A bitter harvest – child labour and human rights abuses on tobacco farms′. <a data-tracker-locationid="cfs | -abitterharvestchildlaborandhumanrightsabusesontobaccofarmsinzimbabwehrw" href="https://www.hrw.org/report/2018/04/05/bitter-harvest/child-labor-and-human-rights-abuses-tobacco-farms-zimbabwe" target="_blank" rel="noopener noreferrer">A Bitter Harvest: Child Labor and Human Rights Abuses on Tobacco Farms in Zimbabwe | HRW</a></sup></p> <p><sup>7. <a data-tracker-locationid="cfs | text4-cfstext4childlabournoquickendtochildrentrappedintobaccoproductionglobalissues" href="https://www.globalissues.org/news/2022/05/17/30869" target="_blank" rel="noopener noreferrer">Child Labour: No Quick End to Children Trapped in Tobacco Production — Global Issues </a></sup></p> <p><sup>8. World Health Organisation (WHO), &#39;<a data-tracker-locationid="cfs | -tobaccofreeinitiative" href="https://www.who.int/news-room/fact-sheets/detail/tobacco" target="_blank" rel="noopener noreferrer">Tobacco Free Initiative</a>&#39;.  </sup></p> </div> </div> </div> </div> </div> </div> </div> <div class="container responsivegrid aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="container" id="container-7dd4603265" data-overlap-top="0" data-overlap-bottom="0" class=" container container--padding-top-lg container--padding-bottom-lg container--padding-right-none container--padding-left-none container--row-spacing-sm container--gridGutters-on container--mobile-order-0 background-- "> <div class="margin"> <div class="wrapper"> <div class="aem-Grid aem-Grid--12 aem-Grid--default--12 "> <div class="title aem-GridColumn aem-GridColumn--default--12"> <div id="title-f9b2cb0142" class="cmp-title"> <h2 class="cmp-title__text text--center colour-- h2">What’s next?</h2> </div> </div> <div class="spacer aem-GridColumn aem-GridColumn--default--12"> <div data-cmp-is="spacer" style=" --custom-xs: px; 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