PRI (the Principles for Responsible Investment) are becoming more relevant over time. PRI is an investor initiative, launched in 2006, which supports the adoption and the implementation of six Principles articulated around Environmental, Social and Governance issues, also called ESG.
According to the definition through this website, they notably promote the integration of ESG into investment analysis, decision-making processes, ownership policies, practices, and disclosure, – mainly working with the institutional investor and asset management community. They also seek to enhance the acceptance of ESG issues in the investment industry as well as knowledge shared among the signatories of the Principles.
These Principles are supported by the UN and have been criticized for being loose.
Some experts assure that this could change in 2020. From June this year, the PRI will start to expel signatories which do not achieve specific standards of sustainable investment. Critics confirm that these requirements are easy to achieve, which has also been confirmed by the PRI. But it is only the start point towards the correct direction, according to Fiona Reynolds, the executive director.
The group has hired over 2,000 investors and has become a de-facto standard in the investment management industry. Nevertheless, if the asset managers withdraw from their commitments, they run the risk of losing their business with customers with a tendency to sustainability.
This should allow the PRI to increase their standards without the fear of losing signatories, it would be interesting to see how fast it is committed though. Definitely, 2020 is the year when all these values will start being taken into consideration.