PRI seeks investor support for nature stewardship initiative

Latest nature push to target companies with 'strong corporate influence' in relevant policy areas.

The PRI has asked investors to sign a statement signalling their support for its new nature stewardship programme, which will initially focus on responsible corporate political engagement.

The initiative, called Spring, was officially launched at PRI in Person in Tokyo on Wednesday. “In its initial phase, the initiative will target real-world outcomes in key geographies that face high risks of future forest loss and land degradation by focusing on systemic policy alignment with the Global Biodiversity Framework,” it said.

As part of the launch, the PRI is asking signatories to endorse its investor statement, which outlines the high-level expectations of target companies – a list of which is expected to be published early next year – regarding their business operations, supply chain management and political engagement practices.

The investor statement says: “Spring intends to engage companies that have an influential voice in shaping public policies relating to deforestation dynamics, either through their direct political engagement or indirectly through their membership in or association with trade associations, think tanks and similar bodies.”

Political engagement expectations on companies include: commit to aligning direct and indirect political engagement activities with the GBF and Paris Agreement; establish and disclose robust governance processes and board oversight to ensure alignment; disclose affiliations to trade associations, think tanks and similar bodies across geographies; and identify, assess and monitor the policy positions and activities of such bodies.

“Where there is misalignment with the aforementioned missions, consider corrective action, with suitable escalation strategies,” the statement added.

The so-called endorsers can sign up at any time throughout the initiative, but in order to be part of a first group of investors to be announced in early 2024, they will need to commit by 19 January 2024.

Investors that sign the expectation statement do not have to engage with the initiative’s focus companies – they simply “signal their support” for the effort. Those wanting to engage companies through the initiative will be asked to apply to do so in early 2024.

The call for investor endorsers follows the PRI’s appointment in June of a signatory advisory committee of 18 investors to help provide input into the development and strategy of the initiative. The investors include EOS at Federated Hermes, Robeco, Scottish Widows, Storebrand Asset Management and UBS Asset Management.

Responsible Investor first reported on the PRI’s plans to launch a nature stewardship initiative in January. In August, RI revealed that the initiative would target up to 80 companies and that its key geographies would include Argentina, Paraguay, Bolivia, Brazil and Indonesia.

On Wednesday, the PRI said company selection is underway and that a focus list is expected to be published in early 2024.

The network is using a three-part process to develop a focus company list, it said. This will involve identifying priority geographies where deforestation takes place and policy arenas impacting deforestation rates in these geographies, as well as which companies have the “strongest corporate influence” in selected policy arenas.

The launch comes at a time of increased focus on how investors are managing the large number of sustainability initiatives they are part of or asked to sign up to. Specifically, duplication among emerging nature-focused initiatives was one of the concerns raised by asset owners in RI’s anonymous survey last month.

One noted that they had become aware of the Nature Action 100 initiative in the same week that they saw coverage of a “different initiative with similar aims about to be launched by the PRI”.

Another said: “As we see the growth of nature-related initiatives now (natural resources, biodiversity, water, deforestation, etc), this must be borne in mind to mitigate redundant duplication amongst an even greater proliferation of topic, industry, geography, asset class and investor type specific initiatives.”

In contrast, one asset manager on Wednesday told RI that “there is space for many initiatives” on nature, and welcomed Spring’s focus on companies’ political influence.

The PRI addressed the topic in the FAQ accompanying the launch of Spring.

“We encourage investors to join multiple initiatives where they have capacity to do so, as we believe that multiple approaches are required to achieve our common goal of halting nature loss,” it said.

“Our aim is not to duplicate efforts, but rather to complement existing work by other initiatives through information-sharing and collaboration agreements, where mutually beneficial for all parties.

“We are working closely with those co-ordinating Nature Action 100, Finance Sector Deforestation Action and others to ensure our programmes of work complement and reinforce each other as much as possible by aligning our strategy and communications.”