AXA Investment Managers –Corporate Governance & Voting
PolicyFebruary 2024
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Table of contents

1. Preamble ..................................................................................................................................3
2. Company Boards and Directors ...................................................................................................5
3. Executive Remuneration ......................................................................................................10
4. Reporting and Audit ............................................................................................................. 13
5. Shareholder Rights ............................................................................................................... 14
6. Mergers and Acquisitions.....................................................................................................18
7. Environmental and Social Issues .......................................................................................... 19
8. Implementation ................................................................................................................... 228.1. OVERSIGHT ........................................................................................................................................... 228.2. COMPANY DIALOGUE .......................................................................................................................... 228.3. VOTING ................................................................................................................................................. 228.4. STOCK LENDING ................................................................................................................................... 23
8.5. CONFLICTS OF INTEREST ...................................................................................................................... 23
8.6. REPORTING .......................................................................................................................................... 23

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1. PREAMBLE
Our general approach

Therefore, we have developed this Policy to help
guide us in performing our fiduciary duties and tocommunicate the principles which underpin this
aspect of our responsible investment activity to themarketplace.

AXA IM's approach to corporate governance –namely our proxy voting and shareholder
engagement work – derives from our strongly held
belief that company management, directors andinvestors all have critical yet unique roles to play insustaining the health of financial markets andensuring the efficient allocation of capital.

This policy provides the foundation for AXA IM's
proxy voting and company engagement activities, aswell as for participation in related public policy
discussions. This policy is applicable to listed equity
holdings managed by all AXA IM entities on behalfof clients who have given AXA IM full discretion to
vote.

Corporate governance refers to the system by whicha corporation is directed and controlled. It concerns
rights, responsibilities of the different stakeholders
in the corporation such as the functioning of theBoards, managers, shareholders.

The building blocks of this policy are based oninternationally recognised best-practice principles
and our lengthy experience as an asset manager
invested and engaging with companies fromdifferent regions with heterogenous governancepractices. AXA IM supports the development ofindustry standards aimed at guiding our activities
as a responsible asset manager. We are notably amember of the United Nations-backed Principles
for Responsible Investment (PRI), a supporter of
the Task Force on Climate-related Financial
Disclosures (TCFD), a signatory of the UK
Stewardship Code (the Code), and an endorser of
the International Corporate Governance Network(ICGN) Stewardship Principles1. We wish to play arole in defining those standards, and to act inaccordance with the principles and best practices
as defined by such relevant initiatives.

The effective governance of individual corporations
by directors and the attentiveness of institutional
investors, as the primary owners of publiccompanies, are required to produce sustainable
performance that serves the best interests of all
marketplace stakeholders. Accordingly, we believethat delivering long-term financial returns requires
effective consideration of all value drivers, including
sustainability factors, in the assessment of ourinvestments’ risk/return profile. In that respect, we
believe that institutional investors have an
obligation to exercise their rights as owners andengage with portfolio companies in a responsible
way. As an investor with a widely diversified
portfolio and long-term horizons, we believe thatsustainable corporate governance increases theresilience of our investments and creates theframework to ensure that a corporation is managed
in the long-term interest of its stakeholders. Voting
at Annual General Meetings is a key component ofstewardship with our investee companies, and aright given to the shareholders, as such, we intend
to exercise our voting rights in a way that is
responsible and prudent, in order to deliver the best
economical outcome to our clients. We consider thisto be part of the fiduciary duty for a fund manager
like AXA IM.

A flexible policy guided by engagement withinvestee companies
We believe that the principles included in this policy
provide a robust framework for the proper
governance of companies. However, in applying
these principles, we are cognisant of the fact thatcompanies are dynamic and a “one size fits all”
approach is not appropriate. We are committed to

1

The complete list is available in our annual
Stewardship report.

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progress, we will not support proposals thatare inconsistent with safeguarding
shareholders’ long-term interests.
3. Engagement: In the event of a resolutionthat is contrary to our policy, standards ofgood governance or the protection of thelong-term interests of shareholders, we willseek to engage with the company before
voting against a resolution, on a best effort
basis and depending on several factors,
including the severity of sustainability risktackled via the resolution and thesignificance of our holdings. We strive tovote in an informed manner, to have aquality vote, guided by our policy and any
additional information provided by thecompany. We will seek to inform thecompanies engaged of any potential voteagainst management in advance, and thereasons for that vote. For the othercompanies, we will inform them of ourvoting intention on a best-efforts basis.

exercise this Policy across different portfolios andmarkets, but Corporate Governance standards canvary from a market to another. Therefore, this policy
prescribes general principles, but AXA IM will take
into consideration specific circumstances such as
geography, company size, market capitalization,
number of our holdings, and most importantly theongoing engagement with the management anddirectors of the company concerned. Our approachis based above all on a regular dialogue with thecompanies we invest in, an understanding of theiractivities, their sector and the challenges they face.
General Principles
1. No abstention: AXA IM aims to vote against
or for a resolution and abstain in rare cases,
guided by exceptional circumstances.
2. Support for management: we aim tosupport the companies (and therefore theirboards) in which we invest on theirtransition journey, via constructive andlong-term dialogue. Yet, if we do not see

The core principles of AXA IM's Corporate
Governance and Voting Policy include the following:

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2. COMPANY BOARDS AND DIRECTORS•Contributing to the right strategy for thecompany;•

Considering material risk issues, including
environmental and social issues impacting
the company;•

Participating in Board discussions on major
issues of business development;•

Appraising the performance of key
executives, including the Chief Executive;

As such, we push investee companies to constituteboards whose approach enables the creation of
long-term sustainable value, thus taking into
account the management and supervision ofstrategic, operational and material financial andnon-financial factors and the interests of key
stakeholders. It is essential that the board is able toestablish and maintain robust governance tosupport and sustain the company's strategic
objectives.

•

Monitoring results and pressing for
appropriate corrective action whennecessary;•

Ensuring that the company has the rightexecutive leadership and appropriate
succession plans;•

Safeguarding shareholders’ funds by using
the ability to challenge management andinitiate change when necessary;•

Ensuring effective company communication
with shareholders; andNON-EXECUTIVE DIRECTORS•

Carrying out specific corporate governancefunctions, principally via Board committees
which deal with real or apparent conflicts ofinterests in the areas of financial reporting,remuneration and nomination of new
members to the Board.

We consider the Board to be the cornerstone ofgood corporate governance as it is the decisionmaking body charged with overseeing a company’s
affairs on behalf of its owners.
Directors have, either by law or in De Facto terms,
fiduciary responsibility for acting in the bestinterests of the company and are accountable to theshareholders as a whole.

The key role of non-executive directors is to ensurethat management concentrate on optimising longterm shareholder value.
The detachment of non-executive directors fromthe day-to-day management of the company meansthat they have the capacity to look at the interestsof the company over the longer term. It is
nonetheless vital that non-executive directors are
truly engaged with the business in their supervisory
capacity and able to bring a long-term perspective
to deliberations so that management decisions are
not dominated by short-term considerations.

Market integrity also requires that key participants
exercise their responsibilities with diligence andhonesty. Events of the last decade have highlighted
the ramifications to companies, investors andsociety of inattention to these basic principles.
INDEPENDENCE
Boards have to manage the company’s relationshipwith a wide range of interests including theexecutives, significant shareholders, employees,
suppliers and regulators. Oftentimes, thesestakeholders have directors representing theirinterest on the Board. Notwithstanding theparticular interest they represent, directors have afiduciary duty to act in the best interest of thecollective shareholder body and to exercise

Non-executive directors must exercise effective
oversight of the executives in relation to theirachievement of strategy and targets as well as
managing situations where there may be real or
potential conflicts between the interests ofmanagement and those of shareholders.
We consider that the role of non-executive directors
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independent judgement when deliberating on thecompany’s affairs.

SHAREHOLDER REPRESENTATIVES
We are not in favour of direct proportionality
between the holdings of major shareholders andthe number of representatives they are allowed tonominate to the Board. Major shareholder(s)representatives should not be allowed to dominate
the Board simply by virtue of the holdings they
represent.

Due to inherent conflicts that may occur, we
require that a significant number of directors on
the Board be independent in a strict sense. Such
independent directors provide assurance that theinterests of a particular group are not allowed todominate the affairs of a company. We expect
Boards to align with national norms or bestpractice on independent director participation on
board.

BOARD DIVERSITYThe Board should comprise a range of directors who,
individually and collectively, understand thecompany’s strategy; can contribute their knowledge
and expertise to the development of its businesses;
understand the environment in which it operates;
have a knowledge of the markets where it conducts
its businesses; are aware of the risks associated withthe strategy; and have insights into the different
stakeholders, including regulators, customers,
shareholders and wider society, whose views
impact on the company or whose support isnecessary for its continued success.

An independent director is one who is free from
relationships or circumstances which could affect,
or appear to affect, the director’s judgement. No
checklist of descriptive characteristics will suffice tocapture whether a director is likely to behave in an
independent fashion. Nevertheless, factors webelieve may affect a director’s judgement andtherefore independence include where the director:• Is a former employee of the company within
the last five years;• Has (had within the last three years) amaterial business relationship with thecompany or is a representative of suchinterests;• Receives additional remuneration from thecompany other than in the capacity of adirector;• Has close family ties with any of thecompany’s directors, senior employees orcompany’s advisers;• Holds cross directorships with an executive
director;• Is or represents a significant shareholder;and;• Has served on the Board for a significant
length of time, from 9 years to 12 years
depending on market practice.

This points to the need for a diversity of skills,
knowledge, experience, gender and nationality
amongst the directors on the Board. We believe thata well-balanced and gender-diverse Board of
Directors leads to higher profitability and value
creation by overcoming issues of group think andtriggering debates and innovation.
We signal via our voting on the Nomination
Committee Chair, other director-related matters,
or any other relevant resolution reservations
around the gender diversity level of investee
companies’ boards.
We are also mindful of all aspects of diversity
beyond gender, especially a diversity of origins,
ethnicities, and social backgrounds. For markets
where this is permissible, we may also take action
against the Nomination Committee Chair where
there is insufficient ethnic representation on the
Board.

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AXA IM - PUBLICBOARD OVERSIGHT OF E&S ISSUES

Moreover, we expect Boards to evidence proper
governance of key ESG-related risk issues, unless
we may raise concerns under the reelection of theBoard Chair.

We will pay particular attention to the board
members’ experience and proven track-record inmanaging environmental and social issues which
may impact the long-term success of the company.
In the context of the energy transition,competences of the board members on material
sustainability issues will be sought as we consider
them to be key and essential.

CHAIRMAN AND CEO
Our general preference is that companies separate
the roles of Chief Executive Officer (CEO) and
Chairman; with the CEO responsible for leading
executives in implementing Board strategy and the
Chairman leading the Board’s supervision of
executive performance. Where these functions are
combined, there would be no independent person
charged with leading the Board’s discharge of its
oversight responsibilities.

In that context, the TCFD guidance on governance,
mainly the disclosure of the board’s oversight ofclimate-related risks and opportunities, and how
the board is acting on those, in addition to
management’s role in assessing and managing
climate-related risks, are elements we examine inthose companies that are critical for the transition.

A company’s decision to combine these positions
will be reviewed on the merits, taking account of thecompany’s circumstances and whether there arechecks and balances to mitigate against power
being concentrated in the hands of one
individual. To guard against this risk, companies
who have combined the Chairman/CEO functions
should appoint a Senior Independent Director (SID)
to lead non-executive directors on matters where
the Chairman/CEO is conflicted and act as anadditional contact point for shareholders. The SID
should be vested with sufficient powers andresponsibilities to act as an effective counterpower.
In addition, where roles are combined, we would
expectthat
qualifiedandexperienced
independent non-executive directors compose atleast 50% of the Board, even in markets where
corporate governance norms accept a lower levelof board independence.

This approach would also apply to other ESG risks
that might be material to our investee companies’
operations, including but not limited to, social issues,and data privacy. On all those issues, engagement
remains the first angle of approach tounderstanding the nomination committee’s
approach of board appointments. However, robust
disclosure on the desired ESG skills, and how
nominees contribute to the overall Board’s
expertise and effective oversight of sustainability
matters, is expected.
In that respect, we welcome the move by many
companies to establish a standing board committee
to oversee the company’s management of its
material environmental and social risks and toensure that the company fulfils its reporting
obligation to enable shareholders to assess this
aspect of the company’s performance. We believethat it is increasingly important that boards address
and report on this activity as seriously as they dotheir other functions.

A decision to combine these functions should be
subject to periodic reviews to ensure that it
continues to be in the interest of the company andits shareholders.

Where we consider that a Board has not managed
environmental and social risks appropriately, we
will reflect our concerns by voting against relevant
directors standing for election.

Although we acknowledge the presence of a retiring
Chair & CEO as Chair to be beneficial in specific cases,
including to ensure a smooth and organizedtransition, appropriate checks and balances should

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be in place to prevent any risk of conflict of interestor undue influence from the non-independent Chair.
AVAILABILITY
In light of the growingly complex and sophisticatedresponsibilities of the Board towards the Company,
its shareholders and an increasingly wider group of
stakeholders, it is crucial that the Nomination
Committee ensure that directors have sufficient
time to devote to their role.
We will therefore be mindful of the number andnature of external commitments held by directors,
and expect them to attend all board andcommittee meetings held.
Limiting the number of boards mandates anindividual can hold may also encourage Board
refreshment and the appointment of candidates
with more diverse backgrounds.
BOARD COMMITTEES
Committees may be beneficial to the effectivenessof Board functioning by providing counseling andadvice to the Board on specific issues that could
require specific expertise.
Therefore, we expect members of any key
committee to have appropriate experience andsufficient expertise in the areas relevant to theduties assigned to said committee. We also expect
key Committees to be majority independent, andhave a strong preference for Committee Chairs tobe appointed among independent directors.
BOARD ACCOUNTABILITY
The Board being the ultimate representative ofshareholders’ interests, we may hold relevant
directors responsible in case of poor managementof environmental, social or governance risks,
including (but not limited to) in the following cases:•

Insufficient measures taken to addressmaterial climate issues which may impact
shareholders’ long-term interests, or any
other relevant E&S issues raised during oneof our thematic engagement;
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Lack of responsiveness following oppositionat the AGM, including on remuneration
proposals;•

Significant environmental, social or
governance controversy which may impact
shareholder value has occurred, and theBoard has proven to have failed to take thenecessary measures to prevent it;•

Measures were taken by the Board thatnegatively impacted shareholders’ rights.

ISSUES OF CONCERN – BOARDS
We may withhold support from director elections in the following instances:
1/ Information & election process• Insufficient information on the Board or where biographical details on proposed directors are
not provided;• Directors do not stand for election by shareholders on a regular basis;• The election of several directors is bundled into one resolution.
2/ Independence
The nominee is not considered to be independent, and:• Independent directors on the Board constitute less than one third (or the number recommended
by local best practice) of the total board (including management, employee directors, etc.).
3/ Diversity:• Composition of the Board does not reflect necessary diversity.
4/ Board oversight of ESG issues• The structure of the Board does not allow for effective management and oversight of ESG risks;• There are not enough directors with an experience and a proven track-record in managing
environmental and social risks.
5/ Dissociation of Chairman/CEO roles• The position of Chairman and Chief Executive are held by one person and the risk is not
mitigated by a Senior Independent Director and a majority independent Board;• The position of Chairman is held by the former Chair & CEO and no adequate counterpower
mechanisms are in place.
6/ Availability• The number of directorships held by the nominee is excessive and/or the director has not
devoted sufficient time to the company.
7/ Board committees:• Key committees are not majority independent;• The Board has not established audit, remuneration or nomination committees while executive
directors sit on the Board.
8/ Board accountability• To raise concerns about the company’s governance or ESG-related performance;• Concerns about a director(s) execution of their ESG risk-related responsibilities;• Concerns about the Board’s response to shareholders’ expectations.

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3. Executive Remuneration
Boards, through the Remuneration Committee, areresponsible for adopting remuneration policies andpractices that promote the success of companies increating value for the longer term.

payable on termination. This information should be
provided on an individual basis.
There is a growing trend for transparency andaccountability by the Board in its oversight ofexecutive remuneration on shareholders’ behalf.
Many jurisdictions provide shareholders with theopportunity to vote on the remuneration policy andits application during the year at the general
meeting.
We welcome this trend towards
accountability and encourage all companies toadopt this practice.

The policies and practices should be demonstrablyaligned with corporate objectives and businessstrategy and reviewed regularly. It is necessary toensure that remuneration policies encourage highstandards of performance, aligning the interest of
management with those of long-term shareholders.
QUANTUM
Levels of remuneration should be sufficient to
attract, motivate and retain management of a highcalibre but should not be excessive by the standardsof employment conditions within the company,
sector or the executive’s country of residence.

PERFORMANCE-RELATED REMUNERATION
Annual bonuses and grants of options or conditional
shares to executives should be subject to definedand relevant performance criteria which should be
disclosed to shareholders. Targets should betailored to the requirements of the business and bereviewed in line with the evolution of thecompany’s strategy.

When setting executive pay, the Remuneration
Committee and Board should therefore consider
pay and employment conditions for the general
workforce. We generally do not support repeatedincreases to the pay and conditions for senior
executives, especially when salary increases(expressed in percentage) for executives on the
Board appear to be higher than increases awarded
to the workforce. In that situation, depending on
the justification provided by the company and thespecificity of each market, we will also expect a
detailed approach on the actions conducted inrelation to protecting and retaining the wider
workforce.

Remuneration arrangements should not entitle
executives to rewards when this is not justified by
performance. Performance conditions may besubject to criteria linked to the company's
performance from a financial point of view.
However, we also encourage investee companies tointroduce criteria linked to the company's nonfinancial performance. Subordinating a part of thevariable remuneration of executives to nonfinancial objectives will accelerate the transition ofcompanies towards more virtuous models.

REMUNERATION DISCLOSURE

Performance objectives should include ESG
elements in order to motivate management tomove the company towards a more sustainablemodel. These elements need to be tangible,
material to the company’s strategy, clearly
explained to shareholders, and not be used as adiscretionary way of adjusting executive
remuneration outcomes.

We expect companies to provide full andcomprehensive information on the company’s
remuneration policy and practices in the Annual
Report. The information provided should cover all
the elements of remuneration, including salary,
annual bonus, benefits, share-based compensation,pensions and details of executive service contracts
including notice periods and compensation

We will pay attention to a choice of relevant metrics,
which are related to the activity of the company, its

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sector, its strategy, and are measurable,comparable and achievable metrics. Criteria usedshould be disclosed, detailed, stringent enough.

should be fully explained so that shareholders canmake an informed judgement.
The operation of share incentive schemes
represents a cost to shareholders. The operation ofsuch schemes should not lead to dilution ofshareholder equity in excess of the limits
acceptable to shareholders.

For companies which belong to the sectors which
are the most sensitive to climate considerations, we
expect specific climate-related criteria to be
included in the variable remuneration of the main
executives.

We support initiatives to encourage executives tohold shares in the company equivalent to at least
one year’s salary. This further aligns the interest of
the executive with those of the company and its
shareholders. Many companies require executives
to retain awards accruing to them under long-term
share schemes until they meet the share ownership
requirement.

EXCEPTIONAL REMUNERATION
We do not support the payment of bonuses thatreward executives for executing transactions (suchas mergers or acquisitions) irrespective of their
future financial implications for the company.
LONG-TERM SCHEMESLong-term incentives, by linking reward to
performance over the longer term, motivate
executives to create sustainable shareholder value.
The receipt of rewards under these schemes
should therefore be based on disclosed andchallenging performance conditions measured
over a period appropriate to the strategic
objectives of the company.

TERMINATION BENEFITS
Companies should align service contract termswith best practice in their relevant markets and inany case should not exceed the equivalent of 24months compensation.
Boards and remuneration committees should
ensure that any compensation paid cannot beviewed as a reward for failure.

The minimum period should be no shorter than
three years and we actively support longer
performance periods that are in tune with thecompany’s longer-term strategy. All new sharebased incentives or any substantive changes toexisting schemes should be subject to prior approvalby shareholders by means of a separate and binding
resolution. Their operation, rationale and cost

MALUS & CLAW-BACK POLICYThe Board should consider means of withholding or
reclaiming rewards under certain circumstances,including where performance achievements aresubsequently found to have been significantly
misstated, or significant controversy or ethics
violation have occurred.

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AXA IM - PUBLICISSUES OF CONCERN – REMUNERATION
We may withhold support from remuneration proposals in the following instances:
1/ Quantum:• Remuneration is based on inappropriate peer comparisons;• Pay for senior executives is out of line with pay conditions for the general workforce.
2/ Disclosure:• There is a poor level of disclosure of remuneration policy and practices;• There is an incomplete disclosure of performance metrics underpinning performance-related
remuneration.
3/ Performance related remuneration:• Performance targets are not relevant to the company’s strategy, insufficiently challenging, orabsent;• Rewards granted are not justified by the Company’s performance;• There are no ESG elements added to the performance-based remuneration (bonus or LTI), or
the KPIs selected are not relevant to the company’s long-term strategy, tangible, clearly
explained, or sufficiently stringent.
4/ Exceptional remuneration• Executives are rewarded for executing transactions irrespective of their future financial
implications for the company.
5/ Long-term schemes• The performance period for a long-term scheme is shorter than three years;• Stock options for executives are granted at a discount i.e. priced below prevailing market
price;• The company engages in option award backdating;• The dilution of shareholder equity through the issuance of shares for share incentive schemes
is excessive.
6/ Termination payments:• Compensation payable on termination is excessive or not in line with market practice;• Termination payment is paid in a situation of failure;• Allows triggering of change in control payouts without loss of job or substantial diminution ofduties;• Enhanced compensation on change of control of the company.

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4. Reporting and Audit
CORPORATE REPORTING

material to the company’s strategy andperformance;

In a well-functioning market, which enables
investors to perform their fiduciary role vis a vis
clients’ assets, it is critical that investment decisions
which impact the allocation of capital be based on
full and accurate information.
Robust disclosure is essential for investors toeffectively gauge companies’ business practices andstrategic planning related to E&S risks andopportunities. Thus, we support the adoption ofinternational frameworks that allow companies toreport on sustainability information. This allows us
to evaluate how the company’s strategy,
governance, performance and prospects, in thecontext of its external environment, lead to thecreation of value over the short, medium and longterm. The Board should provide sustainability
reporting that puts historical performance into
context, and portrays the risks, opportunities andprospects for the company in the future, helping
investors understand a company’s strategic
objectives and its progress towards meeting them.
This reporting should be easily accessible toshareholders, and should:•

Be linked to the company’s business model;•

Be genuinely informative and include
forward-looking elements where this will
enhance understanding;•Describe the company’s strategy, andassociated risks and opportunities, andexplain the board’s role in assessing andoverseeing strategy and the managementof risks and opportunities;

•

•

•

Use key performance indicators that arelinked to strategy and facilitatecomparisons;•Use objective metrics where they apply andevidence-based estimates where they donot;•

Be strengthened where possible byindependent assurance that is carried out
annually having regard to establisheddisclosure standards.

Full company accounts, audited by independent
external auditors, should be presented to acompany’s annual general meeting for shareholders’approval.
AUDIT COMMITTEE
The Audit Committee is responsible for exercisingoversight of the company’s process for internal
controls
andfinancialreporting.
Actingindependently from management, it has a particularrole to ensure that the interests of shareholders areprotected in relation to financial reporting. The
Committee is responsible for overseeing andproviding assurances to shareholders on the
integrity, objectivity and independence of theexternal audit process.
NON-AUDIT FEES
The Audit Committee should pay particularattention to the provision of non-audit services by
the external auditor and the risks that theprovision of such services may compromise theintegrity of external audit.

Be accessible and appropriately integrated
with other information that enables
investors to obtain a picture of the whole
company;

AUDIT FIRM / AUDIT PARTNER ROTATION
There are now developments in many markets
supporting audit firm or audit partner rotation as amean to improve the independence and objectivityof the audit process. We support periodic rotation

Includeenvironmental,socialandgovernance related information that is

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as a further means to enhance the integrity andreliability of the external audit process.

ISSUES OF CONCERN – Reports & Account & Audit
We may withhold support from approval of Reports & Accounts and audit-related resolutions in
the following instances:
1/ Disclosure• The company’s extra financial disclosure is lacking (e.g., oil major with no TCFD-aligned
disclosure);• Non provision of the audited accounts in a timely manner;• Concerns about the integrity of the information reported;• Non-reporting of material ESG performance, particularly in high-risk sectors and or
where sectorial peers are able to report.
2/ Audit Integrity• Where an executive director is a member of the Audit Committee;• Non-audit fees are significantly higher than audit fees and no reasonable explanation isprovided;• The Audit firm has been in place for several years and no retendering of audit services
has been conducted by the Company or there has been no audit partner rotation for asignificant number of years.

5. Shareholder Rights
The ownership of shares in a company entitles
shareholders to corresponding rights in thecompany. We expect Boards to protect andfacilitate the exercise of shareholders’ ownershiprights. This includes giving shareholders reasonable
notice of all matters in respect of which they are
required to take action in the exercise of voting
rights, or which they may elect to take action on.

rights of minority shareholders to the benefit ofmanagement or a particular shareholder(s).
Barriers to the exercise of shareholders’ rights comein different forms. These include restrictions onshareholders’ voting rights; dilution of economic
interests through excessive issuance of shares; andprovisions which aim to limit the right ofshareholders to influence a company’s governance,or their ability to consider transformationaltransactions such as mergers, acquisitions or
disposals.

Major changes to the core businesses of acorporation and other corporate changes which
may in substance or effect, dilute the equity orerode the economic interests or share ownershiprights of existing shareholders, including mergers,
acquisitions, disposals, and issuance of equity
should not be made without prior shareholder
approval.

VOTING RIGHTS
In a shareholder democracy, the shareholder vote at
general meeting is the principal manner throughwhich shareholders can influence a company’s
governance and its strategic direction. Due to its
fundamental importance, we believe thatshareholders should have voting rights in direct
proportion to their economic interest (and risk
exposure) in a company. This is normally expressed

We are fundamentally opposed to measures that
seek to restrict, undermine, dilute or limit theexercise of ownership rights. In particular, we areconcerned about restrictions which seek to limit the14
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as the one share, one vote principle.
therefore opposed to:•

We areadditional dilutive shares in the event of abid;

Measures that dilute the voting rights of any
shareholder by giving certain shareholders
voting rights in excess of their economic
interests;•

Proposals that cap shareholders’ voting
rights once ownership of a certain
percentage of shares is reached;•

Multi-class capitalisation structures created
to provide a particular class of shareholders
with disproportionate voting rights;•

Supermajority
votingrequirements
intended to limit the ability of shareholders
to effect change by effectively providing aveto to a large minority or a group ofminority shareholders;•Voting schemes that do not provide for
confidentiality of a shareholders' voteduring the election;•

Unduly restrictive shareholder disclosure
policies which have the potential to deprive
shareholders of their voting rights.

Transactions which transfer the legal title ofa key asset to a friendly foundation andhave the effect of frustrating a takeover bid;•

Proposed repurchase of the company’s
shares during a bid period at a price that issignificantly higher than the fair market
value of the shares; and•Blank-cheque preferred shares which may
be used as a takeover defence or may beplaced in friendly hands to help block a
potential takeover bid.

PRE-EMPTION RIGHTS
Issuance of new shares presents a risk of dilution toshareholders’ economic interests. It is establishedpractice in many jurisdictions to grant shareholders
the right to approve the issuance of new shares toguard against inappropriate dilution of theireconomic interest in a company.
The issuance of new shares may be on a preemptive basis (new shares are offered to existing
shareholders in proportion to their holdings in thecompany) or on a non-pre-emptive basis (where thepre-emption rights of shareholders are excluded).

ANTI-TAKEOVER PROVISIONSThe Board has an important role in ensuring that thecompany is properly valued during change ofcontrol transactions. However, we have concerns
about anti-takeover devices that have the effect of
discouraging transactions that may be attractive toshareholders or which limit shareholders’ ability tovoice their opinion on a change of control
transaction. Many of these devices serve toentrench management and do not allow
shareholders the opportunity to judge theperformance and prospects of the company under
its management relative to the proposal from thebidder.

We are vigilant in reviewing resolutions to issue
new shares, particularly if such requests are inexcess of the norms in the relevant market. Factors
we will take into consideration in reaching adecision include:

Devices that cause concerns include:••

Poison pills which deter takeovers by
granting the board the ability to issue15
AXA IM - PUBLIC•

The level of dilution of value and control forexisting shareholders;•

The strength of the business case: in orderto make a reasoned assessment
shareholders need to receive a clear
explanation of the purpose to which thecapital raised will be put and the benefits to
be gained - for example in terms of productdevelopment or the opportunity cost of notraising new finance to exploit newcommercial opportunities - and how thefinancing or proposed future financing fits
in with the life-cycle and financial needs ofthe company;•

The size and stage of development of thecompany and the sector within which it
operates;•

The stewardship and governance of thecompany. If the company has a track recordof generating shareholder value, clear
planning and good communications, thismaygiveshareholders
additional
confidence in its judgement; and•Availability of financing options that do not
involve the issue of new shares.

GENERAL MEETINGThe choice of the general meeting format is thatof every company and its board to determine.
However, virtual meetings, if badly executed, may
diminish the ability of shareholders to effectively
participate and engage the board.
Therefore, we consider that virtual-only AGM
formats should only be held in emergency
situations, with companies ensuring that:• They have reliable and securetechnological capabilities to support thevirtual meeting and ensure effective andfluid participation.
• Questions are allowed and moderated
during the meeting under objective andtransparent criteria.
• Submission of shareholder resolutions, tothe extent permitted by law, are nothindered by the fact that the meeting isoccurring virtually.
• Shareholder identification, for the
purposes of participating in the meeting,askingquestions,orsubmitting
shareholder resolutions, is electronicallyfacilitated.

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AXA IM - PUBLICISSUES OF CONCERN – Shareholder Rights
We may withhold support from resolutions that impact on shareholder rights in the following instances:
1/ Voting Rights:• Measures that dilute the voting rights of any shareholder by giving certain shareholders voting rights inexcess of their economic interests;• Proposals that cap shareholders’ voting rights once ownership of a certain percentage of shares is reached;• Multi-class capitalisation structures created to provide a particular class of shareholders withdisproportionate voting rights;• Supermajority voting requirements intended to limit the ability of shareholders to effect change byeffectively providing a veto to a large minority or a group of minority shareholders;• Unduly restrictive shareholder disclosure policies which have the potential to deprive shareholders of theirvoting rights.
2/ Anti-takeover provisions:• Poison pills which deter takeovers by granting the Board to ability to issue additional dilutive shares in theevent of a bid;
• Transactions which transfer the legal title of a key asset to a friendly foundation and have the effect offrustrating a takeover bid;
• Proposed repurchase of the company’s shares during a bid period at a price that is significantly higher than
the fair market value of the shares;• Blank-cheque preferred shares which may be used as a takeover defence or may be placed in friendly
hands to help block a potential takeover bid.
3/ Pre-emption Rights• Proposed issuance of new shares with or without pre-emptive rights that are either in excess of themarket norms or are not justified.
4/ General meeting formal• General meeting is held virtually with no compelling rationale and no assurance that shareholder rights
be preserved, if not enhanced

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6. Mergers and Acquisitions
Mergers and Acquisitions require that we closely
evaluate the expected long-term success of thetransaction and may require a balancing of interests
on both sides of the transaction.
When evaluating a transaction, factors we take into
consideration will include:•

Short-term and long-term valuations, taking
the company's strategic potential into
consideration;•

Ability of the acquirer to successfully
implement the acquisition and integrate thecompanies;•

Strategic fit of the companies and ESG
factors bearing on future success;•Views of significant shareholders;•

Impact of the transaction on customers andother stakeholders;•Competitive landscape for the relevant
entities before and after the transaction;•

Leverage embedded into the transaction
and leverage after completion;•

Degree of management remuneration
misalignment with shareholder interests,

including change in control, bonus,
consulting and incentive award payments;•

Advisor conflicts resulting from successfees, investment banking opportunities andfuture interests in the surviving entity;•

Fairness of the process, such as whether
there was a fair auction, alternatives wereconsidered and the deal was evaluated byanindependent
committee
withindependent advisors;•

Market reaction to announcement of thetransaction;•

Corporate governance profile of any
surviving entity in which we will retain aninterest;•

Human capital impact of the transaction
taking account of the consequences for
employees and communities.

Due to the complexity of change of control
transactions, voting decisions will be made on acase-by-case basis jointly with fund managers, inline with the interests of their clients, and including
any material ESG considerations.

ISSUES OF CONCERN – Mergers and Acquisitions
We may withhold support from change of control transactions including mergers and acquisitions• Where our fund managers believe that the transaction is not in the long-term interestsof shareholders;• Favourable terms are offered to majority shareholders to the detriment of our clients.

7. Environmental and Social Issues
We believe that companies which operate without
due regard to the environmental and social impactof their activities are unlikely to deliver sustainablelong-term shareholder value, being overly exposed
to risk of reputational and regulatory backlash,which could result in fines, higher taxes, or boycotts.
A
company’s
managementofrelevant
environmental and social issues is a lead indicator of
success or failure.

o

We also encourage companies to start integrating
the notion of a Just Transition into their climate
strategy and consider social implications of thechallenges posed by the energy transition.
In companies considered to be in risky sectors,
particularly exposed to climate issues, the Board
may be held responsible for not taking thenecessary measures to address those risks. In suchcases, a dissenting vote may be cast against theManagement, the Board Chairman, the Audit
Committee Chairman, or the appropriate
supervisory element of the governance structure incase risk management shortcomings are proven tohave occurred or enough commitments are notmade to address issues we raise via our thematic
engagements.

We expect companies to align their policies andpractices with the Principles of the UN Global
Compact on Human Rights, Labour, Environment
and Ethical Behaviour and OECD Guidelines forMulti-National Enterprises.
CLIMATE
Climate change is the major risk facing society today,
and immediate action is required if significant
environmental and societal damages are to be
avoided. Failing to do so will jeopardise the global
economy and the prospect of a sustainable
investment returns given the potential for more
extreme weather events, social disruption and theloss of economic activity. As investor, we need to
identify the main contributors to climate risks tobetter understand the potential financial impacts
and thus be able to deliver stronger and more
resilient financial returns over the years anddecades to come.

VOTE ON TRANSITION PLANS
While acknowledging strategy as being of theprerogative of management, we welcome themovement by some investee companies to submit
an advisory vote on their transition plans, as a spacefor shareholder dialogue and increased engagement.
We welcome regular votes or other means ofshareholder communication on the progressagainst these announced strategies, and theirregular revision in line with science and investor
expectations.

Therefore, as part of our climate risks policy we urge
companies to:ooolimited to the Paris Agreement goals;
andAlign executive remuneration toclimate change objectives.

Commit to a net zero emission strategy,
with short-, mid- and long-term carbon
emissions reduction targets that are
based on climate science. There should
be a clear explanation of corresponding
capital allocation plans;
Integrate the company’s entire value
chain in the climate strategy;
Perform scenario analysis using a
scenario where global warming is

We will analyse them and assess their consistency
with the company’s climate strategy. We will
regularly review the proposed plans and ask
companies to report to shareholders andstakeholders on the achievement of the objectivesof these transition plans, notably in the mediumterm. We will also seek disclosure of potential
climate lobbying activities to ensure consistency
between publicly stated goals and corporate
lobbying.
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BIODIVERSITY

the Board should disclose, monitor, and regularly
review whether the lobbying activities of tradeassociations are consistent with the company’s
public positioning on environmental, social andgovernance issues, and should be willing torelinquish their membership in case of
misalignment. A dissenting vote against relevant
resolutions may be cast at companies particularly
exposed to climate issues that fail to appropriately
report on their climate lobbying activities.

In light of the alarming deterioration of ourbiodiversity system, we believe it is increasingly
important to consider how biodiversity loss might
impact long-term portfolio sustainability – namely
in the form of business and market disruptions(linked to major fluctuations in raw material costs
and disruptions to operations and supply chains),
reputational and regulatory risks (with theintroduction of new regulations and global
initiative such as the Global Biodiversity
Framework), and potentially lower returns.

TAX TRANSPARENCY
Aggressive tax practices pose material financial
risks to our portfolios, as a company’s profitability
dependent on tax savings leads to heightened
vulnerability to regulatory changes. It also
increases the litigation and reputational risks
weighting on companies.

Therefore, as part of our policy on Deforestationand Ecosystem Protection, we encouragecompanies with a material impact and reliance on
biodiversity and natural capital more globally to
put in place effective mitigation strategies withinrelevant timelines.

In addition, corporate tax contributions enable
governments to generate revenues for essential
services, and are thus crucial to financing the
Sustainable Development Goals (SDGs) andaddressing global inequality.

For these companies, insufficient improvements
in terms of disclosure of biodiversity-related
strategy and risk management may lead to adissenting vote cast against the Management(including by supporting biodiversity-relatedshareholder resolutions) or the Board.

We therefore expect adequate tax disclosure toenable our understanding of the Boards’
priorities and risk management.
Investeecompanies should have a detailed tax policy andgovernance. They should also provide sufficient
disclosure on tax arrangements, and we
encourage a country-by-country reporting.

In companies which are exposed to other ESG risks,such as social and data privacy risks, the Board
may also be held responsible for not taking thenecessary measures to address them.

We will carefully review shareholder proposals
related to tax issues and may decide to support
them to encourage further transparency oncompanies’ tax practices. We may also decide, ona case-by-case basis, to vote against the Board
Chair or the Audit Committee Chair should
significant tax controversies arise.

POLITICAL DONATIONS & LOBBYINGThe Board of Directors should ensure that charitableand political contributions and membership of tradeassociations are in line with the long-term interestsof the company and its shareholders. In particular,

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AXA IM - PUBLICISSUES OF CONCERN – Environmental & Social Issues
We may withhold support from relevant resolutions including approval of Reports & Accounts,
director elections, remuneration proposals or support relevant E&S-related shareholder proposals
in the following instances:
1/ Disclosure• Non-disclosure of quantitative and qualitative information (and where appropriate targets)on key environmental and social issues of relevance to the company, particularly in high-risk
sectors (climate, biodiversity issues) and or where sectorial peers are able to report;• Insufficient tax disclosure.
2/ Performance• A material failure in the management of environmental and social risks with resulting
negative impacts on the company and stakeholders including employees, customers andcommunities;• Material breach of one or more Principles of the UN Global Compact on Human rights,
Labour, Environment and Ethical Behaviour and OECD Guidelines for Multi-National
Enterprises;• Support for lobbying positions contrary to the long-term interests of the company and its
investors.

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8. Implementation
8.1. OVERSIGHT

executive/Board performance, and management of
extra-financial drivers of risk and reward.

The Corporate Governance and Voting policy isrevised annually and validated by the Corporate
Governance Committee and by the Sustainability
Strategic Committee. It is ultimately validated by
AXA IM Management Board.

Our general policy is to be supportive of companies
in which we invest. However, where we haveconcerns that have not been or cannot beadequately addressed by a company’s management,
we will bring the issue to the attention of the
Chairman and other non-executive directors. We
may also act in conjunction with other shareholders.

The policy applies to listed equity holdings managed
by all AXA IM entities on behalf of clients who havegiven AXA IM full discretion to vote.23

If we are unable to resolve the issue throughengagement, we may consider using our clients’ownership rights to vote against relevant
resolutions or, submit resolutions at shareholders'meetings or requisition of an extraordinary general
meeting.

AXA IM has established a Corporate GovernanceCommittee which is charged with upholding goodstandards of corporate governance in investee
companies. The Corporate Governance Committee
is co-chaired by the Chief Investment Officer of AXA
IM Paris and the Head of AXA IM Group Research.
The Committee comprises representatives ofInvestment teams, who bring their investment
perspectives to the Committee’s deliberations, aswell as representatives from Responsible
Investment teams. It is organised by the Corporate
Governance team.

Corporate governance-related engagement is partof our engagement policy (link). Portfolio managers
of relevant platform are involved in the engagementwith investee companies.
8.3. VOTING
We believe that voting at company meetings is an
important part of the dialogue between a company
and its shareholders and a fundamental aspect ofour fiduciary duty to our clients. We actively
monitor resolutions proposed for shareholder
approval at general meetings and exercise voting
rights on behalf of our clients.

In addition, members of our Compliancedepartment are represented on the Committee toensure that decisions are taken in line withprescribed process, free of conflicts and in theclients’ interests. Our Middle Office is also
represented on the Committee in view of theirimportant role to ensure that the voting chain andprocessing of voting instructions works correctly.

However, we recognise that practices vary in
different jurisdictions and that the companies inwhich we invest are subject to different local laws
and regulations on governance matters. Whenreviewing resolutions proposed at general
meetings we judge resolutions against
fundamental principles of good corporate
governance, while taking account of best practicestandards pertinent to the relevant market andthe Company’s particular circumstances.

The Corporate Governance team implements thispolicy under the direction of the Committee.
8.2. COMPANY DIALOGUEAXA IM holds regular discussions with the Board andmanagement of investee companies on a range of
topics including the company’s strategy, operational
performance, acquisition and disposal strategy,

2

3 Although voting may occur in alternative asset classes, AXA IM

Application of this policy may differ upon request from clients ordepending on local regulation.

Corporate Governance & Voting Policy would not be applicableconsidering the specificities of such asset class.

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AXA IM - PUBLICAs far as possible, we do not apply any specificrestrictions on voting regarding the type ofresolution nor the issuer in question, but theobjective is to vote at all possible general
meetings. Exceptions to these would be explainedin our annual voting report.

We manage conflicts within our voting activities
using the following approach. Firstly, the Corporate
Governance Committee has the sole responsibility
for taking voting decisions on behalf of clients who
have given AXA IM full discretion to vote. Voting
decisions are taken prior to any reference or
discussions with clients who have not delegatedvoting rights to the Corporate GovernanceCommittee or have their own Policy. This is toensure that decisions are free from outside
influence.

AXA IM makes use of the voting information
services of Institutional Shareholder Services, andProxinvest. The research received is used toaugment knowledge of companies and resolutions
at forthcoming general meetings. All voting
decisions at listed companies’ AGMs are made by
the AXA IM Corporate Governance team and are
based on our Corporate Governance & Voting
Policy4.

In addition, where potential conflicts of interests
have been identified, recommendations to vote insupport of management resolutions contrary to ourregular Policy position will be escalated to the
Corporate Governance Committee. Any decision by
the Committee to vote contrary to the Policy
position in these cases will be supported by awritten record and, where appropriate, will be
notified to the relevant local internal governancecommittee and/or Compliance Department.

8.4. STOCK LENDING
Stock lending aids market liquidity and allows clientsto maximise revenues from their holdings and is atechnique used by AXA Investment Managers.
However, the attendant transfer of voting rights
along with the lent shares means that additional
scrutiny is required to ensure that lent shares are
not put to purposes that are detrimental to thelong-term interests of the shareowner. Shares will
not be lent where the objective of such activities is
to vote at general meetings.

An independent voting advisory service has been
appointed to take voting decisions on behalf of ourthird-party clients at the general meetings of ourparent company, AXA SA.
Our conflict-of-interest policy is available on our
website.

AXA IM as lending agent intends to recall all shares,
ahead of the record date (where the record date is
not backdated) in advance of general meetings toexercise our full voting right for open-ended funds
and mandates. Ongoing securities transactions aremonitored by the securities lending team.

8.6. REPORTING
Our Voting Records are accessible to the public anddetail how we voted at General Meetings ofcompanies held on our clients’ behalf. In addition,
we publish a Stewardship Report and a TCFD and
French Article 29 of the Energy Climate law’s reporton an annual basis and information on responsible
investment issues, engagement with companies andaggregated voting records for the relevant year.

8.5. CONFLICTS OF INTEREST
In relation to our stewardship activities, we haveadopted a set of guidelines to identify
circumstances which may lead to conflicts ofinterests. These guidelines include relationships
with listed affiliates such as our parent company,
AXA SA, key clients and significant suppliers.

Voting and Engagement reports are available on ourFund Center for our ESG, Sustainable and Impact
funds. We also provide our clients with detailed

4

Unless instructed otherwise by our clients or local
regulation.

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quarterly reports on voting and engagement
activities upon request.

Information on AXA IM’s Responsible Investment
activities is available on our dedicated RI website.

Issued by AXA INVESTMENT MANAGERS PARIS, a company incorporated under the laws of France, having its
registered office located at Tour Majunga, 6 place de la Pyramide, 92800 Puteaux, registered with the
Nanterre Trade and Companies Register under number 353 534 506, and a Portfolio Management Company,
holder of AMF approval no. GP 92-08, issued on 7 April 1992.
In other jurisdictions, this document is issued by AXA Investment Managers SA’s affiliates in those countries.

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