The PRI is developing a new collaborative stewardship initiative on nature. We will convene a group of investors, who will use their collective voice and influence to shape positive outcomes for nature.
What will the initiative focus on?
The initiative’s objective is for investors’ collective influence to contribute to the goal of halting and reversing biodiversity loss by 2030. This is aligned with the goals and targets of the Kunming-Montreal Global Biodiversity Framework.
The initiative is part of the PRI’s wider support to signatories on managing nature-related risks and harnessing value creation opportunities around nature and biodiversity. Our initial focus will be on forest loss and land degradation, as a key driver of biodiversity loss, and will likely expand to other drivers of biodiversity loss as the initiative further develops.
Why is this initiative needed?
Biodiversity loss is a systemic issue, with direct and indirect effects across the entire economic and financial systems. At least 44 trillion USD of economic value generation (i.e., half of the world’s total GDP) is moderately or highly dependent on nature and its services and is therefore at risk from biodiversity loss.
Investors are highly exposed to systemic risks like biodiversity loss. Universal owners and long-term investors, in particular, have a limited ability to diversify their portfolios away from the impacts of such issues. Stewardship activities, particularly when carried out in collaboration with other investors, are an essential tool for managing risk, as well as shaping more sustainable real-world outcomes.
What is the initiative’s approach to addressing biodiversity loss?
The initiative will focus on enabling policy change and implementation across geographies to help generate positive outcomes for nature. Focusing investor efforts on influencing policy change will make it more likely that change does not happen on an individual or voluntary basis, but instead across economic sectors and at an appropriate pace.
Investors can influence policy change and implementation through two broad approaches:
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Directly through their own engagement with policymakers, and
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Indirectly through their engagement with investees, with regards to their responsible corporate political engagement.
The initiative will have an initial focus on the latter, including on companies’ lobbying and other political influencing practices. Given the importance of using all avenues available to ensure investor influence contributes to robust public policy design and implementation, the PRI also continues to support existing, successful investor initiatives focusing on direct investor engagement with policymakers, such as the Investor Policy Dialogue on Deforestation (IPDD).
Contact
Please contact isabella.coin@unpri.org if you have further questions at this stage.
FAQs
Will the initiative focus solely on companies’ political engagement practices?
No – the initiative will seek to influence positive outcomes for nature using all levers available to participating investors.
When engaging with companies, a particular focus will be on their responsible political engagement practices, given the importance of strong public policy design and implementation. However, companies’ own operations and supply chains may also be the subject of engagement activities where such a focus is necessary to achieve the initiative’s goal of contributing to halting and reversing biodiversity loss.
Why was forest loss and land degradation prioritised as the first thematic focus of the initiative?
Forest loss and land degradation (FLLD) has been prioritised as the first driver of biodiversity loss which will be addressed through PRI’s stewardship initiative due to:
- Its significant contribution to the climate and biodiversity crises;
- Existing PRI expertise, developed during past programmes on deforestation and sustainable commodities; and
- A strong investor demand for PRI to convene a stewardship initiative on this topic.
A phasing-in of further drivers of biodiversity loss will be scoped in 2023, for example to address drivers of biodiversity loss in other realms (e.g., oceans, freshwater).
What will the initiative’s governance and structure look like?
PRI staff will be responsible for designing, coordinating and leading the initiative, and they are supported by two advisory bodies:
- Signatory advisory committee: this group will be comprised of ~15 PRI signatories with strong experience in stewardship and addressing nature-related issues. This group provides strategic advice about the initiative to the PRI.
- Technical advisory group: this group will be comprised of ~10 PRI stakeholders, such as NGOs, with deep expertise on nature. This group will provide technical and scientific advice related to nature to the PRI.
The Investor Working Group (IWG) will be made up of investors responsible for carrying out day-to-day engagement activities with focus companies and other stakeholders.
Who will be able to join the initiative?
PRI signatory asset owners, investment managers, network groups or engagement service providers (with a specific mandate to engage with companies on behalf of an institutional investor(s)) will be able to join the initiative. Signatories applying to be part of the Advisory Committee will be selected based on their stewardship experience, knowledge of biodiversity / forest loss and land degradation, and engagement with PRI’s work.
How will the PRI work with existing collaborative initiatives?
The PRI is supportive of any initiative which increases and improves the effectiveness of investor action on nature. Our aim is not to duplicate efforts, but rather to complement existing work by other initiatives through information-sharing and collaboration agreements, where mutually beneficial for all parties.
We are working closely with those coordinating Nature Action 100 to ensure our programmes of work complement and reinforce each other as much as possible.
Which companies will be engaged?
Company prioritisation will take place once a Signatory Advisory Committee and Technical Advisory Group are in place. PRI staff are currently developing a prioritisation framework which will inform the company selection exercise.
