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UN PRI Signatory List Grows
By Tyler Collins

The United Nations-backed Principles for Responsible Investment (PRI) Initiative has recently published the annual list of signatories.

In the last fourteen months, 254 new signatories joined the PRI, forty-one of which were U.S.-based organizations. This recent growth brings the total number of PRI signatories to more than 1,100, representing more than $32 trillion in assets under management. First Affirmative Financial Network signed on in the spring of 2006.

The PRI, created in 2005 as a joint-effort by the UN Environmental Programme Finance Initiative and the UN Global Compact, is a network of international investors working collectively to enact the six Principles for Responsible Investment.

PIMCO, one of the most recent signatories to the UN PRI, said in a recent Q&A, “As a firm, we believe that ESG [environmental, social, governance] integration goes hand in hand with our objective to achieve solid financial returns while at the same time managing risk and taking into account companies’ ESG performance.”

Many people have expressed concern over the effectiveness of PRI’s principles. For example, BlackRock and AllianceBernstein voted for fewer than 5% of the proxy resolutions focused on climate in 2011 (Fund Votes), despite one of PRI’s principles addressing the importance of corporate engagement on ESG issues.

As a result, the UN PRI is creating a new Reporting Framework in order to achieve three main sets of objectives for signatories:

  • Accountability of the PRI: to ensure transparency and accountability of the PRI initiative and its signatories.
  • Signatory transparency: to encourage signatory transparency on responsible investment activities.
  • Signatory assessment: to provide tools to allow signatories to measure their performance with objective indicators.

This new reporting framework will replace the previous online reporting system, and scheduled to be fully released by October 2013.

Mention of specific companies or securities should not be considered a recommendation to buy or sell that security.  Past performance is never a guarantee of future results.

Posted: November 28, 2012