The rules of alpha engagement in China By David Smith 27 April 2021 If you’re a passive investor, you’re missing out on the chance to make a positive impact on the companies you own. So what does it mean to be an active shareholder? Being active means engaging with companies after you’ve bought them, constructively asking questions of management with a view to encouraging improvement. This can help drive investment returns, in our experience. Engagement means different things to different people. In practice, there are two types: proactive suggestions around environment, social and governance (ESG) issues; and remedial efforts to get a company back on track in response to a negative event.