Increasing numbers of pension funds are taking the stewardship activities and policies of asset managers into account when selecting them, but are also continually being held back by investment advisers, the National Association of Pension Funds (NAPF) has revealed.

In its annual Engagement Survey, which published data from 42 respondents with combined assets under management of £323bn, the NAPF stated that 71 per cent of pension funds were now engaging in stewardship activities up from 48 per cent in 2011.

In addition, 90 per cent stated that they had reviewed their asset managers’ application of the stewardship policy.

The NAPF stated that there was still some room for improvement as investment consultants proactively raised the issue of stewardship with pension funds in just 38 per cent of cases and even when it was discussed investment consultants recommended signing up to the Code in less than half of the cases (45 per cent).

NAPF chief executive Joanne Segars said: “Our research shows that pension funds are embracing their stewardship responsibilities and are beginning to foster a market for stewardship.

“As key intermediaries between pension funds and asset managers, investment consultants could do more to encourage the take-up of the Code by explaining its relevance to their pension fund clients. We believe that this could drive more pension funds to sign up to the Code."

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