Signatories self-select the category they fall into, but the PRI Association Board reserves the right to determine which category is most appropriate. While the categories are not designed to be overly prescriptive, the general rule is that an investor would be considered an asset owner rather than an investment manager if it manages more of its own funds than those of third-party clients.
We ask that the highest level of an organisation signs up on behalf of the entire organisation, including its subsidiaries. The signatory category would depend on which of these businesses is the largest. In cases where different businesses are run independently, it is possible to sign up across different categories as an asset owner, investment manager or professional service partner.
This category includes organisations that represent end-asset owners who hold long-term retirement savings, insurance and other assets. Examples include pension funds, government reserve funds, foundations, endowments, insurance and reinsurance companies and depository organisations.
Why sign the PRI?
The importance of ESG issues is recognised by top pension funds and investors, who want to reduce both risk and generate sustainable financial returns. There is a growing body of expert opinion and evidence that well governed companies produce more reliable returns and deliver stronger environmental performance than poorly governed companies.
This category includes investment management companies that serve an institutional and/or retail market and manage assets as a third-party provider. Investment managers that are not actively managing assets (in fund raising stage) can sign the PRI as provisional signatories. They are granted this status for 12 months, after which their status is reviewed and, if necessary, renewed at the discretion of the Secretariat. The fee for provisional signatories is based on the target size of their fund. Once they are actively managing assets they must inform the Secretariat and will be signed as active signatories.
Why sign the PRI?
Being a signatory to the PRI gives asset managers a competitive edge over their non-signatory peers by helping them to develop their expertise to better incorporate in investment strategies the risks and opportunities posed by ESG issues. Asset owners, pension fund trustees and investors are demanding increasingly that managers are responsive to ESG issues and able to further their responsible investment goals. Integrating ESG factors fits the needs of clients, and in order to promote the best interests of their clients, becoming a signatory to the PRI is an obvious step.
Professional service partner
This category includes organisations that offer products or services to asset owners and/or investment managers. Although such professional service partners are not stewards or managers of assets in their own right, they do have considerable influence over how their clients address ESG issues. For this group, becoming a signatory is an acknowledgement of the relevance of ESG issues to investment management. It also represents a commitment to providing and promoting services that support the implementation of the Principles by clients, and to improving such services over time.
Why sign the PRI?
As investors increasingly look to incorporate ESG issues into their investment processes, the implementation of the Principles by signatories will affect the investment supply chain. With ESG factors increasingly perceived as important by investors, service providers need to be well informed. PRI membership allows service providers to keep up with the latest responsible investment trends by giving them access to extensive resources and expertise and providing opportunities for them to become partners on engagements with companies.