United Nations Secretary-General
Launches “Principles for Responsible Investment”
Backed by World’s Largest Investors
International Funds Worth $2 Trillion Announce
Endorsement at New York Stock Exchange
New York, 27 April 2006 – In
a historic development for global financial markets,
United Nations Secretary-General Kofi Annan was
today joined by a group of the world’s largest
institutional investors at the international launch
of the Principles for Responsible Investment.
The heads of leading institutions
from 16 countries, representing more than $2 trillion
in assets owned, officially signed the Principles
at a special launch event at the New York Stock
Exchange. The Principles were developed during
a nearly year-long process convened by the UN
Secretary-General and coordinated by the UN Environment
Programme Finance Initiative (UNEP FI) and the
UN Global Compact.
“These Principles grew out of
the understanding that while finance fuels the
global economy, investment decision-making does
not sufficiently reflect environmental, social
and corporate governance considerations – or put
another way, the tenets of sustainable development,”
the Secretary-General said.
He added: “Developed by leading institutional
investors, the Principles provide a framework
for achieving better long-term investment returns
and more sustainable markets. I invite institutional
investors and their financial partners everywhere
to adopt these Principles.”
In joining with institutional
investors to develop the Principles, the United
Nations collaborated with some of the world’s
most influential institutions – many of them public
pension funds – involved in investment activities
worldwide. It is estimated that pension funds
alone – public and private – account for up to
35 percent of total global investment.
More than 20 pension funds,
foundations and special government funds, backed
by a group of 70 experts from around the world,
held meetings in Paris, New York, Toronto, London,
and Boston over an eight-month period to craft
the Principles.
“We are proud to endorse the
Principles, which recognize that social and environmental
issues can be material to the financial outlook
of a company and therefore to the value of our
shares in that company,” said Denise Nappier,
Treasurer of the State of Connecticut, who is
the principal fiduciary of $23 billion in pension
fund assets. “Financial markets tend to focus
too heavily on short-term results at the expense
of long-term and non-traditional financial fitness
factors that could affect a company’s bottom line.
For many institutional investors it is the long-term
that matters and in this context environmental,
social and governance issues take on new meaning.”
The six overarching Principles,
which are voluntary, are underpinned by a set
of 35 possible actions that institutional investors
can take to integrate environmental, social and
corporate governance (ESG) considerations into
their investment activities. These actions relate
to a variety of issues, including investment decision-making,
active ownership, transparency, collaboration
and gaining wider support for these practices
from the whole financial services industry.
"We manage assets for future generations
and acknowledge the link between long-term return
and the governance of companies, markets and economies,"
said Knut N. Kjaer, Executive Director of the
Norwegian Government Pension Fund, which holds
assets of more than $250 billion. "We engaged
in developing these Principles to help broaden
the understanding of what drives long-term fund
performance. Investors must collaborate to support
well-regulated markets and sustainable development,"
Kjaer said.
Editor’s Note:
While access to the event is restricted, a live
webcast of the Secretary-General’s remarks, the
signing ceremony and the subsequent panel discussion
will be available from 9:45am to 11am EDT on 27
April at http://www.nyse.com/events/1145959807704.html
The full text of the Principles for Responsible
Investment, as well as an updated list of asset
owner signatories is available on http://www.unpri.org.
Additional resources from the event, including
high resolution photographs, video coverage, additional
quotes from investor signatories will also be
available on http://www.unpri.org/.
About the Organisations:
UN Global Compact
Launched by United Nations Secretary-General Kofi
Annan in 2000, the UN Global Compact brings business
together with UN agencies, labor, civil society
and governments to advance ten universal principles
in the areas of human rights, labor, environment
and anti-corruption. Through the power of collective
action, the Global Compact seeks to mainstream
these ten principles in business activities around
the world and to catalyze actions in support of
broader UN goals. With over 2500 participating
companies from more than 90 countries, it is the
world’s largest voluntary corporate citizenship
initiative. For more information, please visit
www.unglobalcompact.org.
UNEP Finance Initiative
The United Nations Environment Programme Finance
Initiative (UNEP FI) is a unique global partnership
between UNEP and the financial services sector.
UNEP FI works with 160 financial institutions
– banks, insurers, asset managers, and pension
funds - to develop and promote linkages between
sustainability and financial performance. UNEP
FI is the oldest and largest partnership between
the UN and the global financial sector. UNEP FI
promotes the adoption of best environmental and
sustainability practice at all levels of financial
institution operations. For more information on
UNEP FI, see: http://www.unepfi.org
