Policy

Engage signatories, policy makers and regulators to identify and tackle regulatory barriers to responsible investment.

The Policy team is conducting a project on fiduciary duty, involving interviewing investors, lawyers, regulators and policy makers across eight countries, and holding four stakeholder roundtables, in the UK, US, Japan and Australia. A series of asset owner case studies on long-term guidance will form a short best practice guidance document building on the long-term mandates discussion paper issued in mid-2014.

The team is working with the PRI’s two UN partners and UNCTAD to investigate how effective regulation is at creating good practice. The project will compile a global map of responsible investment regulation and compare it against the PRI Reporting Framework.

The team will react quickly to policy consultations using data from the PRI Reporting Framework as an evidence base. This approach has already led to well-received submissions to the Japanese FSA, the European Commission and members of the All Party Parliamentary Group for pensions in the UK. All consultation submissions are also made public on the PRI website.

Current projects:

LONG-TERM MANDATES

The PRI launched a discussion paper on Long-Term Mandates, building on existing research, in particular, the International Corporate Governance Network’s (ICGN) model mandate. The paper presents a range of potential ways in which investors can ensure a long-term investment horizon.A consultation was opened to identify leading investor practice in mandate design, and seeks to accelerate the shift from analysis to implementation, in order to achieve long-term sustainable returns and improve system-wide capital allocation.

Download a copy of “Long-term mandates: a discussion paper”
  • On the 11th June 2015 the PRI organized the ‘Long-Term Mandates: A Practical Guide to Implementation’ workshop. The presentation is available here.

For further details contact Will Martindale (PRI).

FIDUCIARY DUTY

Fiduciary duties exist to ensure that those who manage other people’s money act in the interests of beneficiaries.Ten years after the original Freshfields report into fiduciary duty, many investors have made positive steps to incorporate sustainability risks as part of their fiduciary duties.
Despite significant progress, challenges remain. Many large investors have yet to sign the PRI or make equivalent commitments to responsible investment. Even among PRI signatories, most investors have yet to fully integrate ESG issues into their investment processes.The central objective of this project is to understand why investors are not systematically integrating ESG as part of their fiduciary duty. The report will propose practical actions for institutional investors and policy-makers to address these barriers.

Download a copy of “Complying with your Fiduciary Duty:
A Global Roadmap for ESG Integration”
  • On the 19th March 2015 the PRI and UNEP FI organized ‘Complying with your Fiduciary Duty: A Global Roadmap for ESG Integration’. The UNEP Inquiry moderated the panel. The event notes are now available to view here.
  • On the 21st April 2015 the PRI and UNEP FI participated in a panel discussion at the RI Asia 2015 Conference to examine the relevance of fiduciary duty for trustees in Japan, and to analyse how prevailing definitions and interpretations of fiduciary duty affect investors’ approach to the integration of environmental, social and governance (ESG) issues into their investment processes.The event notes are now available to view here.
  • On the 22nd April 2015 the PRI and UNEP FI convened a panel discussion at the UKSIF 2015 Edinburgh Conference to explore how prevailing definitions and interpretations of fiduciary duty affect UK investors’ approach to the integration of environmental, social and governance (ESG) issues into their investment processes. The event notes are now available to view here.
  • On the 9th July 2015 the PRI and UNEP FI hosted four webinars that presented the preliminary findings and recommendations into fiduciary duties and ESG integration, 10 years on from the original Freshfields report. The webinars focused on two questions: (i) to what extent is fiduciary duty an obstacle to ESG integration and long-term responsible investment, (ii) what actions might be taken at the national and international levels to address these obstacles. The recording of the webinar is now available to view here.
  • On the 4th June 2015 the PRI convened a panel discussion at the Rotman School of Management to explore how prevailing definitions and interpretations of fiduciary duty affect Canadian investors’ approach to the integration of environmental, social and governance (ESG) issues into their investment processes. The event video are now available to view here.

For further details contact Elodie Feller (UNEP FI) or Will Martindale (PRI).

PUBLIC POLICY

Public policy affects the sustainability and stability of financial markets, as well as social, environmental and economic systems. Based on interviews with an international group of investors and policymakers, this report analyses how and why investors can engage with policy. This report offers practical, effective recommendations, proposing a five-step approach to better integrate investor perspectives on environmental, social and governance (ESG) factors in the public policymaking process.

Download a copy of “The case for investor engagement in public policy

For further details contact Will Martindale (PRI).