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lift-off for SRI transparency guidelines

September 2003

Fund managers in Europe have begun using guidelines intended to give the investing public – and companies – a clearer idea of how SRI funds decide which firms to exclude from portfolios.

The guidelines, released by the European Sustainable and Responsible Investment Forum, state that SRI funds in Europe should be clear about how they research and evaluate companies and make investment decisions.

They say funds should publicly reveal their main social and environmental aims, disclose sources of non-financial research and detail proxy voting policies. Funds should disclose whether they have a voting policy on SRI matters, and whether companies are allowed to see what researchers have written about them.

In addition, they are expected to ‘briefly describe the corporate responsibility policies of the parent company’, or say where this information is publicly available.

The draft guidelines propose funds detail their methods of engagement, explain how they measure whether their work in this area is effective, and ‘what further steps, if any, are taken if engagement is considered unsuccessful’.

Eurosif said the guidelines, which are voluntary and have been developed with European Commission funding, were in part a response to calls from the EC for greater disclosure from the SRI retail sector.

Fund managers that have agreed to pilot them for a year include Henderson, Insight, ISIS, Jupiter and Standard Life (all UK), Bank Sarasin (Switzerland), Kepler Fonds (Austria), SEB Invest (Germany) and Banca Etica (Italy).




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