European Commission unveils programme to improve investors' ESG information
EUROPE - The International Corporate Governance Network (ICGN), the UN Principles for Responsible Investment (PRI) and the European Federation of Financial Analyst Societies (EFFAS) have been appointed by European Commission vice-president Antonio Tajani to lead a new programme to build the capacity of investors to integrate social, environmental and governance (ESG) information in their investment decisions.
Over a period of 18 months, the collaboration is set to result in a comprehensive professional development programme, as well as guidance on best practice in the integration of ESG information into investment decisions.
Tajani said: "The transformation to a sustainable economy will be driven by industry and investors together. Europe's enterprises need to know their shareholders understand how social, environmental and governance performance affects financial performance.
"Bringing together some of the leading organisations in the field, this ambitious programme will build on current best practice and help to make adequate consideration of material, non-financial information the norm among investors and analysts.
"It will enable investors to calculate the long-term value of companies more accurately and generate greater recognition from the market for sustainable, responsible and innovative business practices."
James Gifford, executive director at the PRI, added: "This programme will significantly enhance the PRI's capacity to deliver implementation support to our signatories.
"While many PRI signatories are implementing the principles within their portfolios, there are still significant gaps, particularly when it comes to different asset classes. This collaboration will make an important contribution to bridging these gaps."
The European Union will finance 50% of the total cost of programme, which is estimated at approximately €450,000. The main project partners will finance the other half.
The EU funding is part of a broader programme to support the uptake of corporate social responsibility (CSR), financed under the Competitiveness and Innovation Programme.
Together, the ICGN and PRI represent around 900 mainstream investors with more than $29trn (€21.2trn) in assets under management.
EFFAS has access to a network of more than 16,000 investment professionals in 25 European countries.