Ethos has received top marks in the annual Report on Progress detailing the implementation of the six United Nations Principles for Responsible Investment. It is ranked in the group of leaders for each of the six principles, and even obtains the highest possible mark with respect to three principles. This is a recognition by the financial community of Ethos' initiatives for sustainable investment and responsible ownership practices.
The six Principles for Responsible Investment (UN PRI, see box) define objectives which should lead investors to align their investments with our society's core objectives. In signing the principles, investors acknowledge that environmental, social and governance (ESG) issues can have an impact on portfolio performance. They also pledge to engage in dialogue with companies in order to encourage improvements in their social and environmental performance.
The PRI Secretariat commissioned Mercer Consulting to undertake a second annual assessment comparing the degree to which the 360 signatories have integrated the principles into their investment processes. Although the assessment is based on each participant's self-evaluation, it provides a basis to gauge trends in socially responsible investment. Ethos, as a signatory of the principles, also took part in the evaluation.
In addition to the complete 2008 report, the participants received their individual evaluations. These show that Ethos achieved excellent scores in all six principles, even earning the highest scores with respect to the following three principles:
Investing with ESG criteria: In accordance with its Charter, Ethos has systematically applied ESG criteria in its investment decisions since its establishment in 1997.
Seeking disclosure of ESG information from companies: The joint initiative by Ethos and Pictet Asset Management to carry out the Carbon Disclosure Project (CDP) for Switzerland for the second consecutive year is just one example that shows how Ethos is actively committed to seeking disclosure of ESG information relevant for the investor community. The CDP requests one hundred Swiss companies to publish information pertaining to their greenhouse gas emissions and regarding the consequences of a shift towards a less carbon-intensive society.
Reporting on progress in implementing the PRI: Ethos provides regular information on its activities and progress in applying the PRI in its various publications and studies.
To the extent that this is compatible with their fiduciary responsibilities, signatories commit to the following six principles:
1. Invest with ESG criteria
2. Incorporate ESG criteria into active ownership practices
3. Seek disclosure of ESG information from companies
4. Promote acceptance and implementation of the principles
5. Work together to increase the effectiveness of the PRI
6. Report on progress in implementing the PRI
