Principles for Responsible Investment (PRI)

The United Nations-supported Principles for Responsible Investment (PRI) is an international network of investors working together to put the six Principles for Responsible Investment into practice. Its goal is to understand the implications of sustainability for investors and support signatories to incorporate these issues into their investment decision making and ownership practices. In implementing the Principles, signatories contribute to the development of a more sustainable global financial system.

The Principles are voluntary and aspirational. They offer a menu of possible actions for incorporating environmental, social and corporate governance (ESG) issues into investment practices across asset classes. Responsible investment is a process that must be tailored to fit each organisation's investment strategy, approach and resources. The Principles are designed to be compatible with the investment styles of large, diversified, institutional investors that operate within a traditional fiduciary framework.

As of November 2016, 1,600 signatories representing US$62 trillion assets under management have signed up to the Principles. In some cases, before retaining an investment manager, institutional investors will inquire as to whether the manager is a signatory.

In early 2005, the then UN Secretary-General, Kofi Annan, invited a group of the world’s largest institutional investors to join a process to develop the Principles for Responsible Investment. A 20-person investor group drawn from institutions in 12 countries was supported by a 70-person group of experts from the investment industry, intergovernmental organisations and civil society. The Principles were launched in April 2006 at the New York Stock Exchange.

The Principles are based on the notion that environmental, social and governance (ESG) issues, such as climate change and human rights, can affect the performance of investment portfolios and should therefore be considered alongside more traditional financial factors if investors are to properly fulfill their fiduciary duty. The six Principles provide a global framework for mainstream investors to consider these ESG issues.

The PRI was created alongside the Principles to help put the framework into practice.

1,600 signatories have signed up to the Principles, with an increased sign-up arising from the global financial crisis of 2008-2009, according to a report in the Financial Times.

...
Wikipedia