Principles for Responsible Investment
Via CSRwire.com this afternoon: United Nations Secretary-General Launches ‘Principles for Responsible Investment’ Backed by World’s Largest Investors
Here’s a clip from the press release:
“In a historic development for global financial markets, United Nations Secretary-General Kofi Annan was today joined by a group of the world’s largest institutional investors at the international launch of the Principles for Responsible Investment.
“The heads of leading institutions from 16 countries, representing more than $2 trillion in assets owned, officially signed the Principles at a special launch event at the New York Stock Exchange. The Principles were developed during a nearly year-long process convened by the UN Secretary-General and coordinated by the UN Environment Programme Finance Initiative (UNEP FI) and the UN Global Compact. “
…and here’s a clip from the PRI site:
“As institutional investors, we have a duty to act in the best long-term interests of our beneficiaries. In this fiduciary role, we believe that environmental, social, and corporate governance (ESG) issues can affect the performance of investment portfolios (to varying degrees across companies, sectors, regions, asset classes and through time). We also recognise that applying these Principles may better align investors with broader objectives of society.”
Following are the six Principles (ESG — ‘Environmental, Social, and Corporate Governance’):
- We will incorporate ESG issues into investment analysis and decision-making processes.
- We will be active owners and incorporate ESG issues into our ownership policies and practices.
- We will seek appropriate disclosure on ESG issues by the entities in which we invest.
- We will promote acceptance and implementation of the Principles within the investment industry.
- We will work together to enhance our effectiveness in implementing the Principles.
- We will each report on our activities and progress towards implementing the Principles.
If you are interested in reading the full Principles overview, download the PDF on this page.
TAGS: This entry was posted on Thursday, April 27th, 2006 at 6:55 pm and is filed under Corporate Social Responsibility, Interesting News, Social Enterprise, Socially Responsible Investing. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.
April 27th, 2006 at 7:01 pm
As an aside, I think this is a big step forward as it represents a fairly significant commitment to responsible investing. I’m optimistic that the movement will continue to grow.
April 28th, 2006 at 3:35 pm
Interesting thoughts on CSR. Have you read The Market for Virtue: The Potential and Limits of Corporate Social Responsibility, where Professor David Vogel of the Haas School of Business, UC Berkeley, studies the accomplishments of corporate social responsibility? Do you think the most effective strategy for improving both private and public goals is government regulation?
May 1st, 2006 at 4:40 pm
I haven’t read Vogel’s book yet but have already put it on my reading list.
I do not think that government regulation is the most effective strategy for improving both private and public goals but will concede that some level of regulation may help kick-start the process. In the end, I think the market has the greatest potential to promote change. Accordingly, as Vogel may argue, if the CSR isn’t gaining traction in corporations, it is primarily because the market isn’t demanding it. And if the market isn’t demanding it, who is to say CSR initiatives should be a goal anyway?
I personally think that is a bit shortsighted but can see how the argument can be presented as such. The market may simply be unaware of the benefits of CSR, or have an incorrect view its cost and benefits. And if a little regulatory nudge is all it takes to mobilize the market (to then proceed without regulation), then I’m all for it!
Thank you for the comment!