Hello readers,  

I'm Alan, part of the administration team at Ethical Futures, and designated question-asker at our recent attendance of the Abrdn AGM. As part of our involvement in ShareAction, Julian and I attended Abrdn Investment Management's 2024 Annual General Meeting (AGM) on 24th April at The Assembly Rooms in Edinburgh, a short (and sunny on the day!) walk from our office. 

As Marian and Julian have done before, we attended the Abrdn AGM as a proxy on behalf of ShareAction, an independent charity and UK experts on responsible investment. By buying a single share, ShareAction is entitled to ask a question directly to the board of directors and hold them accountable on a wide variety of environmental and social issues (for more information about ShareAction, click here). On this occasion, our question was a follow-up from ShareAction initially raising the issue at the 2023 AGM. The ‘issue’ in this case being Abrdn's reporting (or lack of) on the ethnicity pay-gap data in their business.  

Arriving at the Assembly Rooms, we were unsurprisingly greeted by the sight of an Extinction Rebellion protest picket outside of the venue, it definitely wasn’t the last we’d see of XR on the day! 

The main issue for protestors revolved around Abrdn’s continued position as one of a dwindling number of large investment management firms who continue to hold significant investments in corporate bonds issued by companies engaged in the expansion of fossil fuel extraction and the use of thermal coal for power generation. In particular, the Indian conglomerate Adani Group, who derive over 60% of their income from coal-related business and currently stand as India’s largest private coal mining company and Ithaca Energy, a leading operator of oil and gas extraction in the North Sea. Naturally, we gathered some leaflets being handed out by XR prior to heading in. 

The AGM itself was held in the suitably grand Music Hall within the venue. After filtering our way through security, we took our seats and briefly awaited the start of the AGM, during which I split my time between some last-minute re-reading of my question and craning my neck to stare at the beautifully gilded ceiling façade and chandelier above us. Despite the grand scenery, the event itself was sparsely attended, with many empty seats in the hall. This could be partly explained by the online attendance of many shareholders.  

The meeting commenced with a short introductory speech from Arbdn’s Chairman of the Board, Sir Douglas Flint, outlining the agenda of the meeting and the process for shareholder voting.  

Although intended to be a short introduction, we quickly discovered that this was XR’s time to strike. Roughly ten of the shareholders present were in fact XR activists intent on making their message heard as loudly as possible. The main point of contention being Abrdn’s refusal to adopt a complete blanket ban on any further investment in fossil fuels and an immediate disinvestment from all existing holdings the firm currently held in the face of the growing climate crisis.  

I was particularly impressed (yet slightly concerned), by the bravery of one elderly woman activist who stood atop her chair and protested loudly despite her visibly shaky legs as she tried (successfully) to maintain her balance. Venue security were kind enough to ensure she got down safely before removing her and her comrades from the room after 15 minutes of disruption.  

The event carried on with Abrdn’s CEO, Stephen Bird outlining the strategies for future growth they created, with anticipation of significant inflows of customers and capital onto their direct to customer platform Interactive Investor, and their adviser platform. He went on to outline Abrdn’s plan to build and grow profitability, “refocusing investments to capitalise on areas of strength” as profits were impacted by volatility and an allocation away from emerging markets into cash and liquidity with higher rates. With regards to IFAs, Mr Bird expressed the board’s faith in the launch of their new AdviserOS platform in 2024 and leveraging their existing reach in the UK IFA market to drive growth in the Managed Portfolio Service offering. 

This was followed by an outlining of plans to cut costs by streamlining their investment business, through exits from non-core areas of business such as their European and US private equity business and Australian operations and a fund rationalisation (a reduction in the number of funds from circa 700 to 580) among other cost-cutting measures.  

After much patient waiting on my part, we arrived at the Q&A session. On this occasion I had volunteered myself as the designated question-asker, with Julian as my trusty note-taking companion. I raised the question, seeking to ascertain an update on their ethnicity pay-gap reporting, highlighting the research which shows a direct correlation between diversity and financial performance.  

The answer we received from Sir Douglas Flint was slightly underwhelming and boiled down to, ‘We’re working on it’. He explained the board’s position that it was ‘not possible to force disclosure’ from their staff and that his lack of participation had resulted in the data collected being ‘too small to be a meaningful sample’ and any resulting reporting from the data they do have being skewed by outliers. He did however confirm that they remain committed to ‘looking for ways or ideas as to how to gather meaningful data’.  

The rest of the Q&A session was dominated by climate change issues, with more considered interventions from non-XR attendees around Abrdn not applying their responsible investment policy to fixed income where it was argued they could have more of an impact. There was further questions around their disinvestment from Adani Group and some quite technical questions from very prepared shareholders referring to their AGM report uses of climate change modelling. It was good to see that hard, well thought-out questions regarding Abrdn’s impact on the climate were not solely reserved to the XR activists in the room but also from less militant shareholders too.  

Shortly after the event end, Julian and I were approached directly by Tracy Hahn, Chief People Officer for Abrdn. She thanked us for attending and explained she had a meeting arranged with ShareAction in the near future. We expressed our disappointment over the lack of any ethnicity pay-gap disclosure. Hahn believed that this was something which would become a legal requirement in future anyway. Julian raised a good counterpoint that this should encourage Abrdn to take the initiative and make voluntary disclosures now. 

All in all, my first experience of a large investment firm AGM was an eye-opener. Climate activists in action, along with the usual talk of dividends, profits and plans for the future. I left with a palpable sense of the strong feelings held by activists and shareholders, namely towards institutional environmental policy decisions. Alongside their very real desire to see our leading investment managers step up, turn words into actions and tackle the pressing social and environmental challenges facing us all.