In 2020, we will focus on several ongoing topics, including board engagement, climate research, and emerging areas of regulatory interest.
We believe direct engagement with corporate boards can enhance discussions about long-term material ESG issues, complement our ongoing conversations with management teams, and help us assess a board’s effectiveness — which is challenging to do using company disclosures alone. We seek to understand how a board collaborates with management and delineates responsibilities. We look for indications that directors foster healthy debate, develop constructive relationships with management, and challenge the team where appropriate. Where we see opportunities for improvement, we provide feedback and explain how the suggestions can benefit our clients, their ultimate stock or bondholders. We expect to have more engagements with late-stage private companies to help them bolster ESG practices, potentially avoiding costly missteps during the IPO process.
We continue to take a multidisciplinary approach, including perspectives from equity and fixed income analysts for a richer dialogue. In 2019, board engagements comprised about a third of our ESG-focused discussions, and we expect that ratio to rise in 2020. As more directors become accustomed to these interactions, we expect board engagement to remain central to our investment stewardship and ESG research process.