About the PRI Leaders’ Group

As part of our 10-year Blueprint for responsible investment, the PRI committed to showcasing leadership and increasing accountability, with a view to raising standards of responsible investment amongst all our signatories.

The Leaders’ Group showcases signatories at the cutting edge of responsible investment, and highlights trends in what these leading signatories are doing. We have used signatories’ reporting responses and assessment data to identify those that are doing great work in responsible investment, both across their organisation, and with a particular focus on a given theme each year.

Background 

Extensive consultation with signatories in recent years has shown strong support for the PRI to use the reporting and assessment process to further differentiate signatories at different stages of implementing the Principles. This includes showcasing leadership to share good practice and encourage other signatories to improve their performance.

Methodology

The PRI Leaders’ Group was based on a different theme each year. In 2019, the theme for the inaugural Leaders’ Group was asset owners’ selection, appointment and monitoring of external managers. View 2019 Leaders’ Group.

In 2020, the theme is climate reporting. All investor signatories – asset owners and investment managers – were eligible. 

To be considered for the Leaders’ Group 2020, signatories had to demonstrate a strategic approach to aligning their organisation with the FSB’s Task Force on Climate-related Financial Disclosures (TCFD)

To assess this we looked at their publicly disclosed responses throughout the climate change reporting indicators of the Strategy and Governance (SG) module, as well as whether they reported: 

  • publicly expressing support for the TCFD
  • having a board-approved implementation plan in place
  • how their organisation is using scenario analysis;
  • considering both short- and long-term climate risks
  • working towards specific climate-related targets

Having screened all signatories against this year’s theme, a combined score using responses from across the Reporting Framework was used to identify, from that pool, the Leaders’ Group 2020. 

Strategy and governance 25%
  • SG module score
Implementation 50%
  • asset class module weighted by AUM
Transparency 25%
  • 20% of voluntary indicators disclosed
  • 5% number of voluntary modules reported on

Independent TCFD reports

Alongside the screening criteria, we will look at whether potential Leaders have published – or can provide evidence they are working towards publishing – an independent TCFD report, and we encourage any potential Leaders to do so by the end of 2020.

Frequently asked questions

What is the PRI Leaders’ Group?

In 2019, the theme for the Leaders’ Group is asset owners’ selection, appointment and monitoring of external managers in listed equity and private equity. The asset owners in the Leaders’ Group were identified by using PRI reporting data to assess the breadth of signatories’ excellence across the Reporting Framework, as well as on the specific theme selected for this year.

The 2019 Leaders’ Group consists of 47 asset owners – roughly equivalent to the top 10% of PRI asset owner signatories.

To better share examples of best practice from these leading players, we share the information those signatories have supplied in their public PRI reporting for other signatories to explore.

What is the PRI Leaders’ Group not?

  • It is not …a ranking of signatories – the Leaders’ Group identifies a group of leading signatories, it does not rank the signatories within it (nor those outside).
  • It is not…an exhaustive list of all leading practices in selecting, appointing and monitoring managers in listed equity or private equity – it identifies a group of leading signatories, and the associated commentary highlights trends and common practices amongst that group. Other leading practices might exist that this approach does not capture.
  • It is not…PRI validation of signatories’ reported data – while the PRI encourages signatories to pursue assurance mechanisms, the Leaders’ Group is based on the same self-reported data that underpins all PRI reporting and assessment.

How were the signatories in the Leaders’ Group selected?

Signatories were screened based on this year’s leadership topic:

  • In 2019, signatories must be an asset owner that has received an A or A+ in the selection, appointment and monitoring module, in either listed equity or private equity.

A combined score using responses from across the Reporting Framework was then used to identify, from that pool, a group of leading signatories equivalent to 10% of all asset owner signatories The combined score covers three areas of responsible investment practice:

  • Governance: 25%
  • Strategy & Governance module score
  • Implementation: 50%
  • Asset class module scores, weighted by AUM split
  • Transparency: 25%
  • Percentage of voluntary indicators disclosed (20%)
  • Number of voluntary modules reported on (5%)

Which signatories were eligible for the Leaders’ Group?

Each year the Leaders’ Group will be focusing on a topic identified in the Blueprint for responsible investment. In 2019, the topic is asset owners’ selection, appointment and monitoring of external managers in listed equity and private equity. Therefore, the Leaders’ Group only looked at asset owners with externally managed listed equity and private equity.

Who was not eligible for the 2019 Leaders’ Group?

  • Signatories that are classified as investment managers or service providers.
  • Signatories that do not use external managers.
  • Signatories that do not have listed equity or private equity in their assets managed by external managers.
  • Signatories that opted out of being included in the Leaders’ Group (2019 Reporting Framework indicator CM 10.3).

What is the difference between the PRI Leaders’ Group and the PRI Leadership Awards?

The Leaders’ Group is identified using signatories’ self-reported data through the Reporting Framework and PRI assessment across signatories’ assets. However, the PRI Awards are recognising individual projects that have been self-nominated by signatories and are evaluated by a panel of independent judges.

Can the PRI share how close my organisation came to the cut-off for the Leaders’ Group?

Showcasing leadership is not about publicly rating signatories – it is to highlight relevant and useful practices and promote learning amongst the responsible investment community. The methodology for identifying the Leaders’ Group consists of an element of scoring. However, the scores are not designed to be meaningful outside of this context, and so will not be communicated, either publicly or to the signatories concerned. The PRI will not be publishing any scores, nor ranking the signatories within the Leaders’ Group.

Will you be releasing a Leaders’ Group every year?

We plan to. We’re very pleased to recognise leadership and to showcase best practices from our signatories in responsible investing. We will look to give similar recognition next year, but on another Leaders’ Group theme.

Will future Leaders’ Groups also be for asset owners, or do you plan to broaden the scope of the group in the future?

Future Leaders’ Groups will have broader themes that open up for the inclusion of Investment Managers. Themes include climate change management and active ownership.