UN to establish non-financial databaseJanuary 2009
The United Nations Principles for Responsible Investment (PRI) is creating a global database of environmental, social and governance (ESG) investment research.
The database will be its first effort to extend the work of the Enhanced Analytics Initiative (EAI), which joined forces with the PRI in October (EP10, issue 6, p3).
Before the merger with PRI, the EAI had provided financial incentives to analyst firms judged to be providing the best analysis. However, that scheme has now disappeared.
Under the new regime, research providers will be invited to send in examples of best-in-class analysis integrating ESG issues into financial analysis, which will then be made available to PRI signatories. The database will be searchable by sector, region and issue.
An independent working group has been formed to moderate research providers’ content. To be eligible, the research must be published, and intended for practical use by asset owners and managers.
The database is thought to be the first of its kind, and PRI signatories appear generally enthusiastic.
Marcel Jeucken, head of responsible investment at PGGM Investments, said: ‘It’s the logical next step to further the EAI’s mission to incentivize better research for long-term investors,’ and added: ‘Its transition into the PRI framework will give enhanced research a truly global dimension.’
However, one senior source in the socially responsible investment sector told EP there was some concern that the ending of the EAI’s incentives scheme for the best ESG analysts had removed a key financial benefit that had helped sceptics in the field to sustain some interest in carrying out non-financial research.
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