reo® turns 25: what have we learned and what comes next?
1. The genesis of engagement
In 2025, the Responsible Engagement Overlay service (reo®) celebrates 25 years of active ESG engagement and proxy voting on behalf of its clients.
For a quarter of a century, reo® has helped shape corporate behaviour across industries and geographies. We have engaged with more than 6,454 companies on the most relevant and impactful ESG issues for their businesses and have recorded over 5,170 ‘milestones’ – instances of positive change.
The environment looks quite different today. Once a niche activity, investor stewardship is now widely understood as a core expectation of asset managers. However, as we hit , some of the tenets of engagement are under challenge. We reflect on the evolution of stewardship – and discuss what comes next.
Figure 1: Engagements by ESG theme
Figure 2: Milestones by ESG theme
Source: Columbia Threadneedle Investments, as at December 2024.
2. Infancy: awareness and foundations
Early engagement and shareholder activism was largely driven by mission and faith-based investors. As concepts of shareholder rights and sustainable development grew, momentum behind active ownership started to build amongst mainstream investors, but through the 1990s it remained a relatively niche activity, often restricted to matters of corporate governance and voting.
But that changed in 2000 when our flagship reo® engagement service was launched. reo® was set up to encourage companies to systematically identify and reduce their negative social and environmental impacts. Initially, it had a focus on climate change, environmental management, human rights, and forestry.
In the wake of 2008’s global financial crisis, a sharp focus was brought to holding financial institutions to account, and pressing for enduring improvements in governance and cultures. In our own engagement programme, we leveraged our relationships with key financial institutions including HSBC and Barclays to promote changes in culture and management behaviour.
Important advances for active ownership were born from activity in this period, with engagement activity gaining legitimacy and investee companies starting to value discussions with shareholders. At the same time, shareholders increasingly recognized their role in expressing views through their votes.
3. Teenage: experimentation and momentum
The teenage years saw a surge in interest, experimentation, and growing pains. With rising climate change awareness. social justice movements, and increasing regulation, investors began addressing engagement and proxy voting more systematically, and in tandem.
Collaborative action also solidified its place in the investor toolkit in the 2010s, as investors recognized and experienced the benefit of speaking to companies as a unified voice. In doing so, they were able to communicate concerns more effectively while gaining greater legitimacy. This in turn unlocked more opportunities to converse with executive-level players and board members.
Our own engagement programme evolved, broadening to more formally consider social themes including public health, human rights, and labour standards. The reaction from investee companies moved beyond box-checking and into meaningful dialogues with corporate leadership, tied to long-term value creation and reputational risk management. For example, we had strong dialogue with Amazon since 2011 on its approach to sustainability, including co-filing a shareholder resolution to encourage improvements in their sustainability disclosure. We pressed for dialogue with their Head of Sustainability and co-ordinated with others to urge the company to prioritise its human capital management strategy during its rapid growth. Our experience afforded us a powerful understanding of what good engagement looks like.
4. Coming of age: integration and accountability
Now in its ‘coming of age,’ ESG engagement and voting are becoming more sophisticated and impactful: shareholder proposals are more targeted and data-driven, and voting patterns increasingly transparent and progressive. Regulators are stepping in with clearer mandates aimed at standardization and enforcement. The integration of ESG into mainstream investment analysis has matured. We have responded by enhancing our use of data and technology as well as deepening thematic expertise by embedding ESG further into our research approach.
The investment landscape is currently navigating a growing anti-ESG backlash, particularly in regions where ESG is seen as politically charged or misaligned with fiduciary responsibilities. Investors could benefit from recentering the conversation around fiduciary duty, transparency, and financial relevance – making clear that ESG stewardship, when practiced responsibly, is not a trend or political stance, but a cornerstone of prudent investing.
Figure 3: Number of engagements by company
Figure 4: Number of engagements by sector
Source: Columbia Threadneedle Investments, as at December 2024.
5. Driving progress on nature:
One engagement area seeing significant development over the last 25 years is nature – the agenda for this topic is now as diverse and vivacious as the ecosystems we are seeking to safeguard! In 2024 we conducted 234 engagements with 191 issuers on nature-related topics, achieving 29 milestones of measurable progress against our engagement objectives.
In recent years we have conducted detailed research projects on topics such as deforestation risks, PFAS (forever chemicals), plastic packaging and water risks to ensure that we are conducting additive engagements with investee companies and to develop investable insights for our portfolio management teams.
We are aware that there are limits to what we can achieve operating independently, and that we need to work with the wider industry to drive progress on nature. We are proud to be a founding investor of the Nature Action 100 initiative, and we continue to sit on the Steering Group and Technical Advisory Group of the initiative.
Case study: DP World
DP World, a global ports and logistics company, initially ranked towards the bottom of its peer group in our biodiversity impact analysis, showing limited capabilities in assessing and managing its biodiversity impacts. This was particularly concerning given the company’s substantial footprint through its port operations and development activities. Through intensive engagement efforts, including 17 interactions through 2022-2024, we have worked closely with DP World to improve their approach to biodiversity management. Our persistent engagement has contributed to notable progress. In this period, the company has specifically taken onboard our advice on biodiversity, commissioning a consultant to identify priority impacts and dependencies across its asset base, publishing a public statement articulating its plan to manage biodiversity impacts and hiring a biodiversity specialist. While the company still has more to do, we see this as evidence of meaningful improvement in biodiversity management. We will strive to continue active engagement with DP World to ensure continued progress in their biodiversity strategy and implementation.
6. What comes next:
As reo® enters its second quarter-century, responsible investment continues to evolve. Increasing awareness of climate change, biodiversity loss and social inequality is prompting broader conversations about the role of investors in supporting systemic change, and greater accountability. reo® has deep experience in through rapidly evolving ESG expectations and regulatory developments in this time, and remains a forward-looking partner, helping investors align their fiduciary responsibilities with their values.
The next 25 years will likely be defined by the transition to a lower-carbon, nature-positive and inclusive economy. In this context, the role of services like reo® – with its deep focus on active ownership – will be more important than ever.
By staying true to its founding principles of constructive engagement, long-term vision, and client service, the reo® service – one that continues to advocate corporate transparency, accountability and progress across global markets.
