Enhancing accountability

Objective 5

Enhance signatory accountability mechanisms

The Reporting and Assessment Framework not only ensures our signatories fulfil our sixth Principle, it provides the transparency and accountability that is fundamental to the PRI’s Mission.

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of Transparency Reports

1,926

QUERIES ANSWERED

via the R&A helpdesk

23

% of Asset owners

voluntarily disclosed their activities

17

% of investment managers

voluntarily disclosed their activities

Empowering asset owners

We introduced the first phase of our Data Portal. This web-based tool enables signatories to search, view, request, access and export responsible investment and assessment reports. The tool strengthens our commitment to transparency and will:

  • empower asset owners to engage with their managers by easily viewing and compiling data;
  • promote sharing of best practice;
  • help signatories to work together to enhance decision making.

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We updated our manager selection, appointment and monitoring reporting module. The new module has more targeted indicators to, among other outcomes, provide a clearer link between the ESG position at a portfolio level and risk and return; and an increased understanding of the role of asset consultants.

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Asset owners considering ESG/active ownership in the selection and/or monitoring of external managers

Selection
55%

Against a KPI target of 55%

Monitoring
53%

Against a KPI target of 52%


Ushering in a new era of accountability

To guarantee that all our signatories are being held to the same level of accountability, this year we introduced the Service Provider Reporting Framework. Developed through direct engagement with 35 service providers, it will:

  • allow service providers to demonstrate their commitment to the Principles;
  • give investors improved access to service provider information with comparable reports;
  • respond to service provider desire to communicate their RI activities.

Although it was introduced on a voluntary basis, with next year’s reporting mandatory, service providers embraced it, with 29% of service provider signatories responding.

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Percentage of signatories disclosing on voluntary reporting indicators

2016
AO: 25%
IM: 19%
2017
AO: 23%
IM: 17%

Increased accountability is one of the focus areas of our Blueprint – of our signatories, but also ourselves. We announced last year that we will introduce measures to delist signatories that do not demonstrate a minimum standard of responsible investment activity. This will ensure that each individual signatory is accountable and guarantee that the PRI remains relevant to investors. We will confirm the methodology for minimum requirements by the end of 2017.

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We introduced the Assurance Working Group. Assurance and verification of data reported to the PRI is regularly the subject of signatory queries. We believe the new working group will help advance accountability and transparency of data; ensure the credibility and consistency of Reporting Framework responses; and build greater stakeholder confidence.

Policy components and public disclosure of policy

Policy components and public disclosure of policy

 

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Focusing on climate

Our signatories tell us that climate change is the biggest ESG risk they face; in fact, 74% and 63% of asset owner and investment manager signatories view it as a long-term risk. To respond to this, we will align climate reporting in the 2017/18 reporting cycle with the FSB Task Force on Climate-related Financial Disclosures recommendations.

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KEY STATS

2016
AO: 66%
IM: 59%
2017
AO: 74%
IM: 63%