Pension funds need to show clear stewardship results to benefit members, Railpen stated. Railpen oversees £34bn for 350,000 members of the industry-wide pension scheme for the railways sector.
At the Pensions Management Institute’s annual conference in London, Matt Lomas, Railpen’s investment manager for sustainable ownership, explained how the scheme updated its stewardship strategy through 2030. The changes focus on financial relevance to ensure efforts support long-term returns.
The strategy keeps four main themes: responsible technology, sustainable financial markets, workforce issues, and climate and nature. However, Railpen shifted some priorities. Within sustainable financial markets, the scheme now emphasizes board effectiveness and shareholder rights more strongly, citing a global decline in governance standards. Lomas mentioned Railpen’s role in supporting the removal of BP chair Albert Manifold as an example of this change.
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“We’re leaning in to board effectiveness a bit more,” he said. “Corporate governance standards have weakened in many places, along with shareholder rights.”
The updated approach includes structured engagement plans for each theme, with clear objectives and milestones. Lomas also raised concerns about dual-class share structures, which reduce the influence of ordinary shareholders, including pension fund members. Railpen supports the principle of “one share, one vote.”
Caroline Escott, a colleague of Lomas, leads the Investor Coalition for Equal Votes, which opposes structures that weaken minority investor rights. “These setups don’t align well with ordinary shareholders,” Lomas said.
The strategy also treats public policy engagement as a key tool for stewardship. Pension funds can shape markets through direct company discussions, policy advocacy, collaboration, voting, and research. On climate and nature, Railpen has refined its focus to areas where investors can make the biggest difference, such as biodiversity and water-related risks.
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“Nature is vast,” Lomas said. “Targeting specific areas where you can have an effect makes it easier to drive change.”
He added that engaging with companies directly often works better than broad systemic efforts. “There are countless issues to address, but the priority should be what benefits the company’s long-term value—and members’ interests.”
Whether this leads to real improvements for members will be the true measure of success.
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