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Principles for Responsible Investment

Information presented in this profile is for reference only. The Initiative, its Supporting Institutions and the Secretariat do not endorse the activities, tools or reports included in this profile.

Last update: September 2021

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Launched in 2006, the Principles for Responsible Investment (PRI) is an initiative that supports the adoption and the implementation of six Principles that promote the integration of environmental, social and governance (ESG) issues into investment analysis, decision-making processes, ownership policies and practices, and disclosure. The principles were developed by investor groups and experts from the investment industry, intergovernmental organizations and the civil society, along with two United Nations partners: UNEP FI and UN Global Compact.

  • Principle 1: We will incorporate ESG issues into investment analysis and decision-making processes.
  • Principle 2: We will be active owners and incorporate ESG issues into our ownership policies and practices.
  • Principle 3: We will seek appropriate disclosure on ESG issues by the entities in which we invest.
  • Principle 4: We will promote acceptance and implementation of the Principles within the investment industry.
  • Principle 5: We will work together to enhance our effectiveness in implementing the Principles.
  • Principle 6: We will each report on our activities and progress towards implementing the Principles.

The initial 100 signatories to these principles have grown to over 4,000 signatories as of September 2021.

Why it matters 

The PRI principles have been adopted by over 4,000 financial institutions and facilitate informed decision-making.

Transparency Reports and Assessment Reports of PRI signatories are available through the online PRI’s Data Portal, accessible by signatories and service providers. It contributes to the informed decision making between signatories working together, and helps the PRI identify areas where further work is needed, among others.

The PRI also assesses signatories to outline how they implement and how they can improve their responsible investment practices, and to facilitate learning and development.

PRI is recognized as one of the leading initiatives in the area of responsible investment

The annual ‘PRI in Person’ is considered as one of the major sustainable finance events. PRI has developed guidance and resources, engagement programmes, investor tools (e.g. reporting tool), training courses (e.g. PRI Academy), and a collaboration platform allowing investors to share information and resources, and enhance their influence on ESG issues. For instance, based on the recommendations made by the Task Force on Climate-related Financial Disclosures (TCFD), the PRI issued a technical guide on TCFD for real assets investors.

Main areas of work related to climate mainstreaming:

The PRI considers climate change to be the highest priority ESG issue that investors should address. It is working to help them mitigate the risks and harness the opportunities of a transition to a low-carbon economy.

PRI signatories are required since 2020 to report to the PRI on their management of risks and opportunities related to climate change through indicators modelled on the disclosure framework of the Task Force on Climate-related Disclosures (TCFD).

PRI climate indicators in 2021 include:

  • Publicly supporting the Paris Agreement;
  • Publicly supporting the TCFD;
  • Board oversight on climate-related risks and opportunities;
  • Management role in assessing and managing climate-related risks and opportunities;
  • Climate-related risks and opportunities identified within investment time horizon(s) and beyond investment time horizon(s);
  • Impact of climate-related risks and opportunities on investment strategy, products (where relevant) and financial planning;
  • Use of scenario analysis to assess climate-related investment risks and opportunities & to test the resilience of investment strategy and inform investments in specific asset classes;
  • Risk management processes in place to identify, assess, and manage climate-related risks and incorporation into overall risk management;
  • Tracking and management of climate-related risks in investment processes;
  • Existence of organisation-wide targets on climate change;
  • Climate-related metric(s) identified for transition risk monitoring and management; and
  • Climate-related metric(s) identified for physical risk monitoring and management.

In addition, the PRI supports The Transition Pathway Initiative, by providing the related secretariat services. The Transition Pathway Initiative is a global initiative launched in 2017 led by Asset Owners and supported by Asset Managers and Service Providers. It assesses company preparedness in high carbon sectors for transition to a low carbon economy.