Responsible investment does not need to be complicated. Trustees also do not need to become experts on ESG matters or ESG investment strategies.
Your approach should fit the size and nature of your fund. The RIO Guide’s Seven Steps will help you through this process. The following actions go a long way to fulfilling your responsibility:
- Set out your fund’s ESG beliefs and strategy in the Investment Policy Statement, with objectives and targets where available.
- Select service providers, including fund managers, that have ESG capabilities and align with your fund’s ESG beliefs.
- Monitor the implementation of the RI mandates by the asset managers.
- Report regularly on your fund’s ESG performance.
- Review your fund’s approach on an annual basis.
Your most important role as a fund is to demand innovation and action from asset managers to align with your objectives and beliefs and to help you achieve your ESG goals. By doing so, you will help drive better product offerings to the market. Better products will yield better returns.
By implementing their commitments to responsible investment, asset owners can accelerate the development of responsible investment through the investment chain.