How Nest exercises its voting rights

As a pension provider, Nest invests in thousands of companies on our members’ behalf. As shareholders, we are given voting rights at annual general meetings (AGMs). This gives Nest a voice when it comes to important business decisions, such as director re-elections, executive pay and climate strategy. Exercising our voting rights is a core part of our stewardship activity and broader responsible investment approach. We use our votes to push for better business practices that we hope will reduce long-term risks facing a company and benefit multiple stakeholders. We take investment considerations, research and analysis, and our engagement history into account to inform our voting decisions. We believe businesses that are well governed and consider their impact on people and the planet will be more successful in the long run, leading to better returns for your pension.  

What's New for 2025? 

Every year, we review our voting and engagement policy, which explains how we’ll exercise our voting rights on various issues. These reviews make sure we reflect the latest research and market and regulatory developments. 

This year, we’ve made some important updates to our global and UK policies, including new guidance on several priority themes such as technology, health, diversity and human rights.  

Technology

Artificial intelligence (AI) is creating new opportunities and risks that could impact businesses and society. This includes risks like privacy concerns, security and job displacement. We now expect company Boards to properly manage these AI risks and opportunities.  

Companies should set clear oversight and guidelines around AI and we may vote against the re-election of certain directors if we see evidence that AI has not been adequately managed. 

We’re also asking tech companies to better manage harmful content on their platforms. This includes making sure they have clear rules about what content is acceptable and processes to remove harmful material. We may vote against the re-election of directors if we believe that potential misinformation, disinformation and other harmful content is not managed effectively. 

Stronger commitments to social and environmental responsibility

We believe respect for human rights in business is strongly associated with a stable business operating environment. Therefore, we expect company boards to demonstrate they're actively overseeing human rights issues and addressing them in their business strategy and operations. 

A healthy natural environment is key for healthy societies and economies. Natural capital assets refer to owning stocks in natural resources such as water, minerals and gases, which provide a wide range of ecosystem services that make life possible. These ecosystem services can be described as the links between nature and business. We encourage companies in high-risk sectors to disclose meaningful and consistent data on their impacts and vulnerabilities to natural capital loss and we may vote against company directors if we find that they don't have clear deforestation and sustainable land use policies or equivalent. 

The food sector faces a number of risks and opportunities; not only does it have an impact on nature and global carbon emissions, but it also has an impact on our health. We have included new wording in our policy outlining our expectation of companies in the food and healthcare sectors to tackle antimicrobial resistance, which has been highlighted as one of the top global public health threats by World Health Organisation (WHO). 

What do these updates mean for your pension? 

By pushing companies to improve their governance and sustainability practices, we aim to: 

• Reduce long-term risks to your savings 
• Support sustainable business practices that can deliver better returns over the long-term 
• Drive positive change in how the companies operate

These policy updates reflect our commitment to investing your money responsibly. As one of the UK's largest pension schemes, we want to use our influence to encourage better company behaviour, which benefits all of you – our members - and society as a whole. 

You can find our updated Global Voting and Engagement Policy here, and our UK Voting and Engagement Policy here.