Commenting on the European Commission’s revised Renewable Energy Directive, PRI’s Head of EU Policy, Elise Attal said:

“The PRI welcomes the raised renewable energy targets for 2030 in the revised Renewable Energy Directive (REDIII). Industry, transport, and heating and cooling in buildings all need to shift to net-zero emission energy sources like solar and wind. Faster permitting will help accelerate the transition.

However, burning scarce and valuable wood and other primary biomass sources risks EU climate and nature targets. Forests are needed for biodiversity, for their carbon storage potential and other ecosystems services, and for high-value, low-quantity material use in the net-zero bioeconomy. The REDIII review in 2026 should strengthen binding sustainability criteria for Member States and exclude tax benefits or other support for using biomass for heating and power generation.”


Commenting on the European Commission’s adoption of ESRS 1 and ESRS 2, PRI’s Head of EU Policy, Elise Attal said:

“PRI welcomes the publication of the first ESRS delegated act. This is an important steppingstone towards investors having access to the data they need to assess sustainability risks, opportunities and impacts.

The requirements on companies to explain why they have deemed climate change to be non-material, and hence not worth disclosing, and to explicitly state which datapoints deriving from the SFDR are non-material, are important to improve transparency of materiality assessments. Investors will be able to keep a watchful eye on investee reporting and will expect comprehensive disclosures based on accurate and science-based materiality assessments. In particular, given climate change is a growing and acute system-level risk, related indicators such as GHG emissions should be considered material and thus reported on by all companies subject to CSRD.

Nevertheless, the Commission’s decision to subject all issue-specific reporting to a materiality assessment may not guarantee investor’s access to the consistent and reliable information they urgently need to allocate capital in line with sustainability goals and meet mandatory reporting obligations, such as the SFDR. The European Commission should commit to making key climate disclosure indicators and environmental and social indicators relevant to SFDR mandatory to disclose in the first review of this delegated act in 2026. In the meantime, it should provide clear, comprehensive and robust guidance on materiality assessments, so that material sustainability information is not omitted by companies.”


Commenting on the EU Parliament’s adoption of the Nature Restoration Law, Rebecca Chapman, Head of Climate and Environment at the PRI, said:

“The EU Parliament’s adoption of the Nature Restoration Law is an important signal which recognises the role of nature in addressing the twin challenges of climate change and biodiversity loss. Nature must be at the core of a European Green Deal that increases the EU’s resilience and aligns with its global climate and biodiversity commitments.

The EU Nature Restoration Law establishes a clear direction of travel and sets the groundwork for further advancement, particularly related to climate and biodiversity finance, which plays a central role at the heart of the issue. PRI supports a swift agreement between Council and Parliament to ratify the Law and will continue to work to ensure that the investor interests in nature and biodiversity are represented.”


Commenting in response to the European Supervisory Authorities Joint consultation on the review of SFDR Delegated Regulation, PRI’s Head of EU Policy, Elise Attal said:

“New ESA proposals published in the consultation should improve transparency and comparability of EU sustainability-related financial products. This can help to address some of the usability issues investors face when reporting under SFDR. The revision of the RTS will need to be carefully sequenced with the European Commission’s upcoming “comprehensive assessment” of the regulation; as well as the recent ESMA proposal on fund names to ensure effective implementation of the changes.

The PRI supports the proposed expanded social PAI indicators and climate target-setting proposals. However, policymakers will need to maintain consistency with the final ESRS as adopted by the European Commission. This will ensure that investors have sufficient data to produce meaningful reports as per SFDR requirements. The Commission’s decision to make certain issue-specific disclosures subject to a materiality assessment under the current ESRS proposal could result in areas of impact. We may see a potential failure to report the information that investors urgently need to assess the sustainability risks, opportunities, and impacts of their investments and meet their requirements under SFDR.”


Commenting in response to the FCA’s Consultation related to Primary Markets Effectiveness Review and proposed equity listing rule reforms, PRI’s Governance Manager, Betina Vaz Boni said:

“The PRI strongly opposes the FCA’s proposal to allow enhanced voting rights to be exercised on all matters without exception. Such a change could weaken existing corporate governance standards, expose institutional investors to undue risk and undermine the effectiveness of their stewardship activities. Our recommendations in light of this is to include maintaining the sunset period for DCSS at five years, without extending it to 10 years. Furthermore, in the interest of transparency, it is crucial to maintain the listing eligibility requirement for companies to have three years of audited historical financial information, representing at least 75% of their business. Mandatory independent shareholder approval of Related Party Transactions (RPTs) at or above the 5% threshold; mandatory independent shareholder approval of significant transactions at or above the 25% threshold and related requirements for shareholder circulars, should also be maintained.

Engagement and voting empower shareholders to improve returns, bolster governance, ensure accountability, address systemic risks, and achieve sustainability goals. The proposed changes by the FCA could curtail escalation opportunities and undermine the impact of stewardship efforts. They also contradict the FCA’s efforts to enhance investor stewardship and align companies’ governance, incentives, and competencies with sustainability considerations. The UK serves as a global reference on corporate governance, and relaxation of existing standards can have a ripple effect on corporate governance practices globally. In light of this, maintaining strong governance practices and preserving investor trust should be the priority, we urge the FCA to reconsider reforms that could undermine investor confidence in the UK market.”


Commenting on the European Sustainability Reporting Standards (ESRS) by the European Commission, René van Merrienboer, Director of Sustainable Systems at the Principles for Responsible Investment said:

“The PRI views the European Sustainability Reporting Standards (ESRS) as a major step forward to providing investors with the decision-useful corporate sustainability-related information they need. We also welcome efforts to align the ESRS with global sustainability reporting standards, while accounting for investor data needs and European policy priorities – this will help to ensure comparable reporting across jurisdictions for investors.

There remain concerns, however, that the European Commission’s decision to make certain issue-specific disclosures subject to a materiality assessment and making it optional to explain why an issue covered by the ESRS is not material for a company. This could result in a potential failure to report the information that investors urgently need to assess the sustainability risks, opportunities and impacts of their investments, and to meet their own regulatory requirements such as those under the Sustainable Finance Disclosure Regulation (SFDR). Therefore, the final standards should maintain certain requirements as mandatory – including Scope 1, 2 and 3 greenhouse gas emissions, disclosures enabling investors to assess the credibility of corporate transition plans, and indicators needed to comply with SFDR and other investor reporting regulations.”


Commenting on the adoption of the European Commission’s sustainable finance package, Elise Attal, Head of EU Policy at the Principles for Responsible Investment, said:

“PRI welcomes the European Commission’s sustainable finance package published 13 June 2023. In particular, we support the dual focus on (i) enhancing the usability and consistency of the sustainable finance framework and (ii) ensuring a transition towards a sustainable and inclusive financial system, economy and wider society.

PRI signatories need regulatory clarity and stability. Therefore, the Commission’s commitment to actively supporting implementation and ensuring that the tools and disclosures work in practice is an important signal. However, more needs to be done in future legislative reviews to achieve coherence and improve usability, while the global convergence of sustainable financial frameworks is also pursued. We welcome the Commission’s intention to intensify its efforts on this.

Beyond coherence and usability, we also support the Commission’s intention to prioritise facilitating transition finance. Given the urgency and magnitude of sustainability issues we face, sustainable finance needs to flow faster and bridge the large private investment gaps to achieve the objectives of the European Green Deal, the Paris Agreement, and the UN Sustainable Development Goals. This Commission’s last sustainable finance package before the end of its current mandate, linking to the Taxonomy and ESG ratings, should support this transition by improving the ability of investors to make informed decisions regarding the sustainability of their investments and helping companies to better understand their sustainability performance.”


Commenting on the adoption of the EU Corporate Sustainability Due Diligence Directive (CSDD) by the European Parliament, Elise Attal, Head of EU Policy at the Principles for Responsible Investment, said:

“PRI welcomes the outcome of the successful vote on the CSDD. The agreed text is an important step forward in creating a practical and effective directive which provides needed clarity in the EU’s sustainable finance policy architecture. As negotiations continue, it is important to maintain and, in some cases, further develop the Parliamentary text to ensure positive real-world impact. We welcome the risk-based approach to due diligence, in line with international standards, and the climate-related requirements. However, a greater acknowledgment of the investor approach to due diligence is needed, building on from the specific ART 8a voted in to encourage investor due diligence through stewardship, as well as clarification of the definition of value chain for the financial sector.”


Commenting on the EU trilogue negotiations on the Nature Restoration Law, Elise Attal, Head of EU Policy at the Principles for Responsible Investment, said:

“The twin challenges of climate change and biodiversity loss can only be solved together. This is why nature needs to be a core component of a coherent, robust European Green Deal that increases the EU’s resilience and aligns with its global climate and biodiversity commitments. PRI strongly supports an ambitious EU nature restoration law, which enables the financial community to fulfil its fiduciary duties, mitigate nature-related investment risks, and direct capital flows to positive outcomes for nature and thriving ecosystems.”


Commenting on the passing of Florida’s HB3 bill, Greg Hershman, Head of US Policy at the Principles for Responsible Investment, said:

“The bill signed today means more confusion and less freedom for investors. This legislation does not change the fact that investors find factors related to climate risks or corporate governance failures material to the value of their investments—it just undermines their freedom to consider those factors. The bill’s vague language related to ‘pecuniary’ factors simply creates more ambiguity when there’s a desire for greater clarity. We urge policymakers in states across the country, but particularly in states like Florida which face severe climate risk and its economic consequences, to hit pause, sit down with investors and let the public and private sectors work together for their shared beneficiaries – the American people.”


Commenting on the G7 ministerial meeting of Labour and Employment Ministries in Okayama, Japan, Margarita Pirovska, Director of Policy at the PRI, said:

“We welcome the renewed focus of the G7 Labour and Employment Ministries on the triple transformation of labour markets, including demographic challenges, digital transformation and the transition to net zero, as well as their continued commitment to promoting decent work in global supply chains, in line with authoritative international frameworks.

However, little emphasis is placed on the need to align the industrial policy required to support jobs in the climate transition. Every ministerial meeting of the G7 forum in the coming weeks should consider the risks and consequences of the transition to net zero. Long-term financial returns and the health of the economy rely on the viability of environmental and social systems. For sustainable job and pension markets in G7 countries, this requires a whole-of-government approach, aligned with the goals of the Paris Agreement and the UN Guiding Principles on Business and Human Rights, among others, to accelerate an effective investment in human capital for adequate upskilling and reskilling to ensure a just transition.

The 2023 Hiroshima Summit is an opportunity for G7 governments to align mainstream economic policy with global sustainability goals. We look forward to a final G7 Minister’s Communique following the May 2023 Hiroshima Summit which shows strong leadership from G7 governments towards a just economic transition to net zero.”


Commenting on the release of the IPCC’s AR6 Synthesis Report, Edward Baker, Head of Climate Policy at the Principles for Responsible Investment, said:

“The IPCC has today issued its starkest call yet: we are running out of time. Today’s report - which should serve as an important informer for investors implementing a science-backed climate strategy - makes the need for urgency abundantly clear. The longer we delay the greater the risks and damages will be. Every fraction of a degree of warming and every year matters in efforts to avoid the most damaging impacts of climate change. Future market stability depends on choices taken now and in the near-term, and investors sit at the heart of the required response. We need deep, rapid, and sustained emissions reduction, a greater focus on adaptation, equitable solutions, scaled-up public and private financing, and international cooperation to manage climate risk effectively. Not only that, but the industry must be supported by complementary policy action, specifically by removing the barriers stymying the flow of public and private capital to climate solutions. We already have most of the solutions, but we need to go further and faster to see these implemented.”


Commenting on the need for a substantive policy response to the rollback of corporate climate targets, Margarita Pirovska, Director of Policy at the PRI, said:

“The combination of high profits and a rollback of climate targets has given rise to some fundamental questions around the part played by fossil fuel companies in the transition to a sustainable world. This climbdown on targets, while deeply concerning and at odds with the urgency of action we are facing, is not a surprise. Shell, BP and others have built their business around the (currently) still profitable business of producing and selling oil. This highlights an enduring market failure and an insufficient global policy response to shift our financial systems to align profits with a liveable planet for generations to come.

While every government is bound to act on climate change as part of their commitment to the Paris Agreement, companies have no equivalent framework in place. This gap cannot be filled by investors alone – policymakers around the world need to work with industry, financial institutions, regulators and scientists to put in place transition measures that will deliver a 1.5C aligned global economic system, where investors can make responsible decisions with certainty around the long-term sustainability of their holdings. We need governments to step in with robust, clear and whole of economy strategy to ensure the transition to a net zero investment system.”


Commenting on the creation of the UK government’s Department for Energy Security and Net Zero and the Department for Business and Trade, Eliette Riera, Head of UK Policy at the Principles for Responsible Investment, said:

“The creation of the new UK government Department for Energy Security and Net Zero can be a positive step towards ensuring these important issues are dealt with holistically and with the appropriate level of focus. Net zero as an issue cannot be addressed in a siloed manner - the current energy security and cost of living crises can be only tackled effectively alongside the pursuit of longer-term climate objectives, and not in isolation. Shifting financial flows to address key societal concerns such as climate change, loss of biodiversity, and inequality, is pivotal to ensuring long-term resilience, stability and prosperity. This requires foundational changes in public policy as a whole: net zero must be placed at the core of the UK government and reflected in all aspects of the new Departments created today.”


Commenting on the release of the UK government’s report on net zero, Margarita Pirovska, Director of Policy at the PRI, said:

“The UK government’s report published today underlines clearly the benefits the UK stands to realise by moving towards a net zero economy. By acting on the areas the report outlines, numerous sectors – including food and beverages, renewable energy, and industries associated with improving household energy efficiency – stand to realise significant growth benefits and attract additional investment. A whole-of-economy, coordinated approach to transitioning to net zero is the most effective and efficient way to achieve the UK’s government’s goals. Investors themselves have made clear and consistent calls for the government move forward in the PMs ambition for the UK to become the world’s first net zero financial centre. We need the government to commit to an ambitious, clear and impactful roadmap for these opportunities to be realised, building on the work to date for the updated green finance strategy, and with renewed consultations with the financial sector.”  


Commenting on the outcome of negotiations at COP15, Tamsin Ballard, Director of Climate at the PRI, said:

“The adoption of the Kunming-Montreal Global Biodiversity Framework marks a historic moment for the conservation and restoration of nature. Adopted by 196 countries under the UN Convention on Biological Diversity, the agreement commits the world to take action by 2030 to halt and reverse biodiversity loss, and as part of this conserve at least 30% of land, freshwater and ocean globally, whilst respecting the rights of indigenous peoples. PRI particularly welcomes the call to align global financial flows with the goals and targets of the framework, the ask for large and transnational companies and financial institutions to assess and disclose their risks, dependencies and impacts on biodiversity and the intent to eliminate, phase out or reform harmful subsidies on biodiversity by 2030. However, to ensure successful implementation, it will now be essential that countries deliver on the Agreement, by translating it into national plans and policies and ensuring the efficient mobilisation of resources.”


Commenting on the agreement reached by the EU institutions on the reform of the EU emissions trading scheme, Ed Baker, Head of Climate Policy at the Principles for Responsible Investment, said:

“We very much welcome the agreement that was reached on the reform of the EU emissions trading scheme (ETS). This is a major milestone in realising the ambition that the EU has set out under the Fit for 55 package. We encourage the EU to implement the ETS extension to the transport and buildings sector in a just and equitable manner, and to incentivise a swift decarbonisation of industry sectors that are currently still receiving free emission allowances until 2034. These steps will further contribute to reaching the EU’s 2030 emission targets and carbon neutrality by 2050. ”


Commenting on the lunch of the US Energy Transition Plan, Ed Baker, Head of Climate Policy at the Principles for Responsible Investment, said:

“While the Energy Transition Accelerator represents a clear advance on previously mooted carbon offsetting initiatives, by directing capital flows to emerging markets, it is important to ensure that commitment to this initiative does not come at the expense of cutting real world emissions. Urgent action is needed to finance the climate transition, particularly for developing countries, but it is important to note that carbon offsetting of this nature should be employed alongside active efforts to cut emissions, rather than in lieu of such efforts.”


Commenting on the launch of the UN High Level Expert Group’s report Integrity matters: net zero commitments by businesses, financial institutions, cities and regions, Shelagh Whitley, Chief Sustainability Officer at the Principles for Responsible Investment, said:

“The High Level Expert Group’s report is an important milestone for the sector and serves to provide an informative roadmap for future ambitious action. Particularly against the backdrop of COP27, it’s clear we need to see ambition maintained and increased in order to drive climate action further and faster. PRI echoes the call to forge closer partnerships between the public and private sectors, as well as the recommendation for the disclosure of actionable net zero transition plans. We remain committed to supporting ambitious investor action on climate through our work across the sector – including on multiple net zero initiatives which play a crucial role in driving additional aspiration.”


Commenting on the launch of the UK Transition Plan Taskforce Disclosure Framework, Eliette Riera, Head of UK Policy at the PRI, said:

“The PRI welcomes the new proposals from the UK’s Transition Plan Taskforce. The proposed framework provides comparable information to support companies’ transition plans to reach net zero by 2050. For investors, this new proposal – alongside the recent release of the Sustainability Disclosure Requirement consultation by the FCA – is a positive step towards delivering on the pledge for the UK to be the world’s first net-zero aligned financial centre and provides needed clarity on companies’ proposed actions to the market. As the COP baton passes over to Egypt, the swift implementation of concrete policies to support short and medium-term climate targets remains an area where the UK government has an opportunity to demonstrate strong leadership.”


Commenting on European Commission President Ursula von der Leyen’s State of the Union (SOTEU) address, Nathan Fabian, Chief Responsible Investment Officer at PRI, says:

“Tackling the climate and energy crisis go hand in hand. Investors understand this and want to contribute to the urgent energy transition. The European Commission’s ambition to take emergency measures to stabilise energy markets and protect companies and households is critical. But these steps must not undermine efforts to agree on an ambitious Fit for 55 package: to accelerate the expansion of renewable energies, catalyse low-carbon innovation in EU companies, and generate sustainable investment opportunities for investors.”


Commenting on the passage of the US Inflation Reduction Act through the Senate, Gregory Hershman, Head of US Policy at the Principles for Responsible Investment, comments:

“The Senate’s approval of $369 billion in climate-related funding is a much-needed jump start for efforts to combat climate change. The climate crisis is not a partisan agenda, it is a scientific reality which affects every community, every market, and every family in the United States. Retirement savings are already under threat from the climate impacts we’re seeing in our communities from drought, fires and record-breaking heat. To prevent the worst of this impact, we need coordinated efforts across federal, state and local governments – with this bill constituting a significant step in the right direction. Now, we must ensure investors are equipped to consider climate risk, and to act accordingly to protect the financial interests of working families across the country. The passage of this bill signifies that we have crossed a major hurdle and can now come together to support additional climate action that ensures a just, inclusive and orderly transition to net zero.”


Commenting on the US Senate’s proposed bill on climate action, Gregory Hershman, Head of US Policy at the Principles for Responsible Investment, comments:

“Just weeks after a regressive ruling from the Supreme Court restricting EPA’s authority, this announcement is a notable step in the right direction. If signed into law, a third of a trillion dollars devoted to the energy transition is a major boost in the fight against climate change. Almost as important as the capital dedicated is the signal this sends to businesses, investors and the rest of the world - the transition is happening, and the United States is ready to do its part. We urge responsible investors to signal their support for these proposed climate measures and the successful conclusion of these negotiations. Now, we need to see further ambitious and supportive action taken within the private sector – among investors and indeed more widely – to facilitate an effective and equitable response to the climate crisis.”


Commenting on the EU Parliament’s vote on the inclusion of gas and nuclear in the EU taxonomy, Elise Attal, Head of EU Policy at the Principles for Responsible Investment, comments:

“The European Parliament has rubber stamped the European Commission’s proposal to include gas and nuclear energy in a complementary section in the EU taxonomy. This will complicate its implementation. Investors will need to carefully review companies’ disclosures to ensure that taxonomy-aligned investments reflect criteria that are science-based. Failing to take this step could prompt fragmentation across the market and lead to potential greenwashing. The PRI will continue to work with its signatories and policy makers to shape taxonomy developments around the globe, aligned with science, to enable global convergence and to ensure disclosures in the EU are applicable and fit for purpose.”


Commenting on the US Supreme Court’s ruling pertaining to the powers of the EPA to take action on climate change, Gregory Hershman, Head of US Policy at the Principles for Responsible Investment, comments:

“Today’s decision by the US Supreme Court is a regressive and harmful step which in practice prevents the federal government from implementing a national policy on climate change. Climate change is real and investors bound by fiduciary duties don’t have the ability to ignore it. Restricting the EPA’s efforts to address the issue limits our ability to approach climate change as a collective challenge and creates significant undue risk at a time when a just and orderly transition to a net zero economy has never been more vital. Investors recognize these threats and are stepping up to the plate to facilitate a systemic response. We urgently need a bipartisan political movement to support these investor efforts.”

For more information on PRI’s US policy work, click here


Commenting on the IPCC’s Working Group III report on the mitigation of climate change, Shelagh Whitley, Chief Sustainability Officer at the Principles for Responsible Investment, comments:

“Today’s IPCC’s report underlines the urgency of the climate crisis. To avoid a dangerous increase in emissions, we must cease new investments in fossil fuels and increase financial flows towards assets which facilitate the low carbon transition. Encouragingly, we know from today’s report that we have the solutions needed to halve emissions by 2030. We also know that there is sufficient global capital and liquidity to finance these solutions. Now, we must see urgent action to finance the solutions needed.

“Investors have a leading role to play in this process. The IPCC report notes that investors are raising awareness of climate change as a financial risk. However, climate-related financial risks, whether from physical climate impacts or from a disorderly transition to a low carbon economy, are still greatly underestimated by parts of the industry.

“The PRI will continue to work with our signatories to support and increase their ambition on climate issues. In addition, we will continue our collaborative work to ensure a supportive policy landscape exists to best enable the vital shift to a net zero economy. The IPCC report shows that there is no time to waste – urgent action is needed to secure the future of our planet.”


Commenting about the new resolution by the UN Environment Assembly (UNEA-5) to end plastic pollution, Shelagh Whitley, Chief Sustainability Officer, PRI said:

”The PRI welcomes the adoption of a resolution at the UN Environment Assembly (UNEA-5) to end plastic pollution and create an international legally binding agreement by 2024. Supported by 175 nations, it marks one of the most significant multi-lateral environmental deals since the Paris accord. Critically this new agreement will address the full lifecycle of plastic, considering its production and design, not just what happens to plastic waste. Plastic pollution is a global challenge and is a systemic issue for investors. Although policies and regulations on plastic use have risen dramatically in recent years, a new legally binding agreement has the potential to make a huge difference through harmonised goals and action from policymakers worldwide. The PRI has supported investors to understand risks and opportunities across the plastics value chain and address plastic pollution across the full plastic lifecycle. The PRI will continue to support investors to take action on this important and fast-moving issue, through its circular economy programme.”


Commenting after the launch of the IPCC’s report, “Climate Change 2022: Impacts, Adaptation and Vulnerability”, Sagarika Chatterjee, Director of Climate and Environment at the Principles for Responsible Investment, said:

“The IPCC has set alarm bells ringing loud and clear with this report. As a society, we are not acting rapidly enough to prevent the widespread impact of climate change, and we face a closing window to keep global warming to manageable levels. We stand at a cliff edge, facing the very real prospect of a world changed forever by the impact of man-made global warming. Billions of people will be affected by the damage climate change will do to our planet, it’s ecosystem, and our very way of life – unless we take drastic action now. International cooperation is at the core of this – a reality felt most keenly in the current geopolitical environment. Looking ahead, investors and governments need to act in concert to realise a global scheme of climate resilient development, which secures sustainable economic growth and preserves the future of our world.”