HSBC Global Asset Management
Engagement Policy
May 2020

Introduction

We believe that environmental, social & governance (ESG) factors can impact the sustainability of companies’ and otherissuers’ financial returns.
We integrate ESG in our investment process by considering these factors alongside others which can impact returns.
We recognise a fiduciary responsibility for the stewardship oversight of companies and other issuers whose securities we holdon behalf of our clients.
Engagement with investee companies and other issuers is an important element in both our ESG integration and ourstewardship oversight.
We expect companies and other issuers in which we invest to provide effective stewardship. We engage with them for better
understanding, to monitor our clients’ investment, and to encourage them to be pro-active and transparent in the managementof ESG and other risks.
This policy applies to both equity and fixed income assets. It reflects our adherence to the European Shareholder Rights
Directive, as well as the UK Stewardship Code1, the Hong Kong Principles of Responsible Ownership, the Taiwan Stewardship
Principles and the Principles for Responsible Investment, to all of which we are a signatory.

1 We intend to apply to become a signatory to the UK Stewardship Code 2020 when applications open in Q1 2021.

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1Monitoring issuers
As an integral part of our investment process, we carefully monitor and analyse all companies and other issuers held in
active portfolios both before and during the period of our investment.
Our monitoring covers: strategy, financial and non-financial performance and risk, capital structure, social andenvironmental impact and corporate governance.
It may include assessment of companies and issuers’ own and market data, consideration of research from brokers andother independent research providers – including ESG & voting research, attending individual & group meetings withmanagement and directors, visiting production sites, talking to competitors, customers and other stakeholders, and ourown financial modelling.
Companies and other issuers held in active portfolios are discussed regularly within our investment teams, informed byour monitoring and analysis.
For companies and issuers held only in quantitative portfolios, we use internal and external ESG & voting research tomonitor companies’ and other issuers’ exposure to and management of ESG and other risks, as well as strategic, financial
and governance issues which may arise.

2Engagement
We meet the management of companies and other issuers regularly as part of our active investment process.
This engagement is a key element in our stewardship oversight of client assets. It may form part of our monitoring ofcompanies and issuers or represent an escalation of concerns we have identified.
We challenge companies and issuers on their delivery of corporate strategy, financial and non-financial performance andrisk, allocation of capital and management of environmental, social and governance issues.
We engage to understand the approach management is taking and test how far they are being good stewards.
We also encourage companies and other issuers held in client portfolios to establish and maintain high levels oftransparency, particularly in their management of ESG issues and risks.
We raise ESG or other concerns with companies and other issuers where we believe that to be in the interest of investors,
identifying company specific or systemic risks.
We prioritise our engagement on the basis of scale of client holdings, salience of the issues concerned, and our overall
exposure to these issues.
In addition to executive directors and investor relations, we engage with other executives as available, including divisionaland regional heads, as well as ESG and strategy specialists.
We also engage with non-executive directors, either as part of our regular dialogue or to raise and escalate issues ofconcern.
Engagement is undertaken through meetings, conference calls and correspondence. We occasionally co-file shareholderresolutions and support or deliver statements at shareholder meetings to communicate publicly with companies andescalate our engagement.

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3Collective engagement
We also engage with companies and other issuers alongside other investors in a number of collective engagements.
These may form part of a broad initiative to address systemic issues such as climate change, or may reflect an escalationof company-specific concerns shared by investors.
Collective engagement helps companies by allowing a focused dialogue with a number of investors on issues of concern.
They also allow investors to share resources and insights to address concerns.
We are careful to ensure that we respect rules about acting in concert and other forms of collective action, as well as rules
on insider information.

4Voting
We believe that exercising our voting rights is an important expression of our stewardship and broader responsible
investment approach.
Our global voting guidelines encourage high standards of corporate governance. They also encourage transparency andaccountability on environmental and social issues.
We apply our global voting guidelines to resolutions at company meetings. Our guidelines are sensitive to developed andemerging market governance standards.
We vote all shares over which clients have given us voting authority, unless the cost or other associated burdens meanthat it is not in clients’ interest to do so.
Votes for all actively-managed holdings are reviewed by fund managers. Quantitatively-managed holdings are usually
voted automatically in line with guidelines.
Engagement with companies on voting issues is an important element in our stewardship activity.
Our voting guidelines are available at: https://www.assetmanagement.hsbc.co.uk//media/files/attachments/common/resource-documents/global-voting-guidelines-en.pdf.

5Conflicts of Interest
Our engagement and voting is focused upon advancing and protecting the interests of our clients as investors incompanies and other issuers.
We recognise that actual and potential conflicts of interest may arise in our engagement and voting. We have establishedpolicies, procedures and protocols to identify and manage such conflicts. These include: functional and operational
independence from other HSBC Group companies, guidelines for our voting, as well as procedures to escalate, manageand monitor conflicts.
Oversight of conflicts of interest is embedded within our governance framework, which includes regular risk management
meetings, a Stewardship, Fiduciary and Conflicts Forum, and CEO responsibility for compliance with HSBC Group’s
conflict of interest policy.
Further details are available at: https://www.assetmanagement.hsbc.co.uk/-/media/files/attachments/common/resourcedocuments/stewardship-and-conflicts-of-interest-en.pdf

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Reporting
Reporting on our engagement and voting is available to clients in line with their requirements. We also publish our voting
quarterly and summary information about our engagement activity annually.
Our voting record is available at: https://www.assetmanagement.hsbc.co.uk/en/institutional-investor/about-us/responsibleinvesting/stewardship.
Summary information about our engagement is available at: https://www.assetmanagement.hsbc.co.uk//media/files/attachments/common/resource-documents/responsible-investment-review-2020.pdf.

@Copyright HSBC Global Asset Management 2020. All Rights Reserved.

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