PRI signatories overwhelmingly endorse new Board structure and Articles of Association
LONDON, 4 February 2015
The Principles for Responsible Investment Initiative (PRI) is pleased to announce that an overwhelming majority of its signatories have voted in favour of the new board governance structure and articles of association. The vote follows on from an 18-month independent review and extensive signatory consultation, paving the way for a simpler, more transparent and accountable governance structure which will come into effect in April 2015.
A record 43% of asset owners voted—the highest participation rate for a signatory vote in the PRI’s history—with 124 asset owners and 303 non-asset owners (27%) casting their vote. Among asset owners, 97.6% approved the revised Articles of Association for PRI Association while among non-asset owners, 96% approved the Articles. The Articles reflect the 10 recommendations of the governance review, PRI Governance Review, and were forwarded to all signatories in December to consider ahead of the vote.
Under the current Rules of PRI Association, the changes must now be approved by the asset owner representatives of the Advisory Council. This will take place at the Advisory Council’s next meeting in New York on 5-6 March, enabling the new PRI Board and governance structure to come into effect on 1 April. Current Advisory Council representatives will become Directors on the new PRI Board and will serve the remainder of their original elected terms.
“The governance review demonstrates our commitment to be responsive to the needs and concerns of our divergent signatory base,” said Martin Skancke, chair of the PRI Advisory Council. “And the incredibly positive response we have received shows that signatories are pleased with the direction we are now taking. In addition to a single governing body, the new Articles will deliver more opportunities for signatories to participate in governance matters and also broaden the eligibility requirements for Directors, promoting diversity while deepening the skills and experience of the Board.”
Notes to editors:
The governance review followed on from an agreement reached by the PRI Advisory Council and PRI Association Board at their joint meeting in Cape Town on 30 September 2013 to carry out a formal review of the PRI’s governance structure and processes.
The aim of this review was to assess what governance structure the PRI should adopt to fulfil its Mission and ensure that it balanced the interests of different signatories and ensure that decisions about the PRI’s mission, direction, strategy, finances and operations are transparent, accountable to signatories, efficient and fit-for-purpose.
At the 2014 Signatory General Meeting (SGM) in Montreal on 24 September, the PRI Chair outlined the proposed changes to the PRI governance structure, detailed in the Advisory Council Chair Cover Note – Proposed PRI Governance Structure.
Following the signatory communication on 2 October outlining the proposed PRI governance structure, the PRI worked with its UK lawyers Bristows LLP to draft the revised Articles of Association for PRI Association (the Company).
About the Principles for Responsible Investment (PRI)
The United Nations-supported Principles for Responsible Investment (PRI) Initiative is an international network of investors working together to put the six principles for responsible investment into practice. Its goal is to understand the implications of Environmental, Social and Governance issues (ESG) for investors and support signatories to incorporate these issues into their investment decision making and ownership practices. In implementing the principles, signatories contribute to the development of a more sustainable global financial system. Visit www.unpri.org.