Asset manager Standard Life Aberdeen has overhauled its company engagement process after being burnt by a scandal at fast-fashion retailer Boohoo over allegations of poor working conditions at some of the company's suppliers earlier this year.

Boohoo's shares slumped in July after allegations that workers were being paid less than the minimum wage at some of the company's suppliers.

Boohoo in September accepted all the recommendations of an independent review, which found several failings in its supply chain.

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Standard Life Aberdeen, which had previously been one of Boohoo's largest investors, subsequently sold out after describing the company's response to the allegations as "inadequate".

Aberdeen Standard Investments' Global Head of Stewardship Euan Stirling said the experience had been "painful", particularly after his team had engaged heavily with Boohoo.

"What we had been doing over the period was not just sitting idly by and counting the pennies as they rolled in," Stirling, speaking at Reuters ESG Europe conference on Tuesday, said.

"We had been making quite significant demands of the company and of specific executives in providing us and the board with assurance over their supply chain, and encouraging them quite forcefully to adopt stronger industry-led practices."

As a result of the experience, Stirling said he had decided to change the process for key engagements going forward.

Institutional investors use "engagements" to talk to companies they invest in about a range of issues, including corporate governance.

"We're trying to now make them more rigorous; specific milestones set out at the beginning of an engagement programme, timelines associated with that and (then) looking for specific outcomes as well," he said.

"It's a significant development in the way that we engage," he said, adding it would apply to companies where ASI had significant concerns or in which it had a large equity or debt holding which could be materially impacted by the issue in question.

By using milestones, Stirling said the company would be able to determine when and how to escalate the engagement, with the ultimate option being, as with Boohoo, to sell out.