In setting the objectives of the social security institution, the board considers the role of socially responsible investing (SRI) and environmental, social and corporate governance (ESG) to ensure the investment policy and strategy are consistent with the mission (where the mission includes elements of SRI and ESG).
This objective applies to both an internal investment institution and an external investment manager.
Guideline code
INVEST_01200
Mechanism
Mechanism
- The investing institution should monitor investments made for social and economic utility to ensure these investments continue to provide social or economic utility.
- The investing institution should be a responsible owner and actively participate in votes and meetings put forward by the social and economic utility organization management.
- Where investment is carried out by an external investment manager, the social security institution should communicate to this organization its objectives in respect of socially responsible investing and environmental, social and corporate governance, and discuss with the manager how this will be carried out in practice in the choice of assets for investment and their monitoring.
- The board should consider the merits and applicability of being a member of the United Nations-backed Principles for Responsible Investment (PRI) Initiative.
Parent
Structure
Structure
- The social and economic utility of investments may be taken into account as the sustainability of any social security institution depends on national economic growth.
- The views of national financial authorities are a legitimate consideration in setting the investment policy and strategy of the investing institution, but those authorities should not be involved in implementation of the strategy, especially the selection of individual investments.
- Socially and economically useful investments funded by social security institution funds should provide risk-adjusted returns consistent with market norms over the time horizon appropriate for the investing institution.
Title HTML
Guideline 9. Socially responsible investing and environmental, social and corporate governance
Type
Guideline_1
Weight
16