Investors hail landmark moment for responsible investment in South Africa

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SOUTH AFRICA, 21 May 2009 – A group of South African investors and service providers worth approximately R1,625 billion, with support from a major international investment house, launched an ambitious investor-led network as part of their commitment to the UN-backed Principles for Responsible Investment (PRI).

South Africa becomes only the third country in the world to host such a network, following the emergence of other PRI country networks in Brazil and South Korea. The South African network was hailed as a ‘potential landmark moment for responsible investment in South Africa’.

The South African PRI Network is to be led by Government Employees Pension Fund and supported by the PRI Secretariat and Noah Chair for Responsible Investment at UNISA. The aims and objective of this network are:

  •  To raise awareness about the business case for responsible investment in order to persuade more South African pension funds and other asset owners to consider environmental, social and corporate governance factors in their investment decisions (ESG). 
  •  To capture evolving best practice on how to factor ESG issues into investments processes and to implement the Principles in the South African context. 
  •  To examine any regulatory and other barriers that might prevent an increase in the ability of South African investors to engage with companies so as to improve corporate performance on environmental, social and corporate governance matters. This will include discussing the potential for future collaborative engagements by investors.

John Oliphant, Head: Investments and Actuarial at GEPF said,

“The new network has come together to help investors put the Principles for Responsible Investment into practice here in South Africa. As investors we recognise that ESG issues such as transformation, human rights and climate change can have a financial impact on our investments if they are not successfully managed, and we are therefore committed to helping build South African capital markets that are sustainable over the long term.  

“No financial institution can do this alone, and this network will help responsible investors in South Africa to combine our knowledge, influence and reach wherever possible. It’s a potential landmark moment for responsible investment in South Africa.”

James Gifford, Executive Director of the PRI added,

“I am delighted that PRI signatories in South Africa have taken the initiative to create this network. Responsible investment is a global movement but needs to be applied to local conditions and focus on issues that are relevant to local investors. This network is a significant step forward in the mainstreaming of responsible investment practices across the globe.”

The full list of PRI signatories involved are:

Government Employees Pension Fund of South Africa, 27Four Investment Managers, Advantage Asset Managers (Pty) Limited, Frater Asset Management, Futuregrowth Asset Management, Hermes Equity Ownership Services, Investec, Kagiso Asset Management, Prescient Investment Management, Prudential Portfolio Managers, RisCura, Sanlam Investment Management (SIM). In addition several non PRI Signatories were also involved.

The Principles for Responsible Investment (PRI)

The Principles for Responsible Investment, convened by UNEP FI and the UN Global Compact, was established as a framework to help investors achieve better long-term investment returns and sustainable markets through better analysis of environmental, social and governance issues in investment process and the exercise of responsible ownership practices. The Principles themselves, a full list of signatories and more information can be found at unpri.org

The Government Employees Pension Fund of South Africa (GEPF)

GEPF is the largest pension fund administrator in Africa with approximately 1 100 000 contributing members, 330 000 pension recipients (excluding members of other funds administered by the GEPF as an agent) and more than R711.15 billion of assets under management. In global terms the GEPF is acknowledged as the 6th largest pension fund in the world. It is a self- administered, defined benefit pension fund committed to effectively and efficiently providing benefits to members, pensioners and beneficiaries. For more, visit www.gepf.gov.za • UN Global Compact: Launched in 2000, the UN Global Compact brings business together with UN agencies, labour, civil society and governments to advance ten universal principles in the areas of human rights, labour, environment and anti-corruption. Through the power of collective action, the Global Compact seeks to mainstream these ten principles in business activities around the world and to catalyze actions in support of broader UN goals. With more than 5000 participating businesses from over 130 countries, it is the world’s largest voluntary corporate sustainability initiative. www.unglobalcompact.org

United Nations Environment Programme Finance Initiative (UNEP FI):

UNEP FI is a unique public-private partnership between UNEP and the global financial sector. UNEP works with over 170 banks, insurers and investment firms, and a range of partner organisations, to develop and promote linkages between sustainability and financial performance. Through its comprehensive work programme encompassing research, training, events and regional activities, UNEP FI carries out its mission to identify, promote and realise the adoption of best environmental and sustainability practice at all levels of financial institution operations. www.unepfi.org

Issued jointly by Government Employees Pension Fund (GEPF) and the United Nations- backed Principles for Responsible Investment (PRI).