Developing an ESG policy

There are several ways in which practitioners can integrate responsible investment into their investment policies. One possibility is to develop a standalone responsible investment policy; another option is to embed ESG considerations into your main investment policy.

As the PRI indicates, a responsible investment policy has many purposes, including:

• serving as a starting point to discuss your organisation’s position on ESG issues with external and internal stakeholders;

• clarifying how an investor interprets its fiduciary responsibilities to beneficiaries and clients;

• guiding external asset managers on how they should handle ESG issues;

• demonstrating your organisation’s responsible investment approach to regulators, clients, and other stakeholders.

In this chapter, we outline some important considerations and steps you can take as you think about developing an ESG policy at the level of your firm and/or your portfolio companies.