Why aren't more bondholders flexing their muscles, Sparinvest asks - AMWatch

Most fixed income investors talk about engagement, but few actually influence their companies, the English language newswire Denmark based AMWatch wrote on Monday, in the light of a new whitepaper from Sparinvest called “Fixed Income engagement - where’s the impact?”

The paper is written by senior portfolio manager Thomas Bjørn Jensen and analyst Antonia Draghici from Sparinvest’s Fixed Income team.

Many fixed income investors claim to use their influence as lenders, Thomas Bjørn Jensen told AMWatch in an interview. "But if you scratch the surface, there are too many definitions of how to be an active owner and to which extent an investment manager actually does it," the senior portfolio manager said.

"It's our experience that companies are willing to listen when we engage directly with them instead of via a large engagement provider as it's a more personal approach. The companies know that we want to improve them because we eye a return potential," said Thomas Bjørn Jensen.

"One of the best things we can get is an official and published statement from a CEO or board that officially states that they want to change and how they plan to do so. This is likely to have a positive impact as the management can be held directly accountable for the progress compared to an indication on the phone," said Thomas Bjørn Jensen. 

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