The Implementation of the Principles of Responsible Investment of the United Nations - Case Study: FSN Capital

Abstract

The Principles for Responsible Investment (PRI) are an international iniciative promoted by the United Nations to promote sustainable development. It works on making people understand the implications that the environmental, social and ethical aspects have in long term investments. The companies that embrace these principles sign a compromise with the PRI that incorporates said aspects to their investment portfolios. Instead of traditional anual reports, these companies publish a report know as ESG Reports in which they emphasises environmental, social and corporate governance aspects. Around 1500 companies in 55 countries have signed with the PRI. After the 2008 crisis there was increased interest for the initiative. In 2005, the Secretary General of the United Nations (Kofi Annan), summoned a group of the largest institutional investors in the world to write the PRI. One of the investors invited was Knut Kjær, which is the President of the board of scandinavian investors (FSN Capital) which adhered to the PRI in 2012.This article explains how investor companies like FSN Capital put to practice the 6 principles and what are the real changes that happen to the companies that acquire and manage these principles. The application of the principles not only promotes a sustainable development but it’s also an essential contributor in obtaining a bigger creation of value and return to long term investment, just like the results obtained by the FSN to date show.