A coalition of global investors is writing to 86 major companies urging them to honour the reporting requirements of the United Nations Global Compact, the world’s biggest voluntary corporate responsibility initiative.
The international investor coalition comprises of investors from 13 countries who collectively manage more than US$2.1 trillion in assets. This is the third year the coalition has asked companies to honour the UN initiative, which is aimed at improving corporate reporting on environmental, social and corporate governance (ESG) activities.
Each of the 86 ‘laggard’ companies had previously joined the UN initiative, but then failed to produce the mandatory annual report on how the initiative’s ten principles had been put into action, according to Principles for Responsible Investment (PRI), an investor initiative in partnership with the United Nations Environment Programme Finance Initiative and the UN Global Compact.
In 2008, the engagement resulted in 33 per cent of laggard companies subsequently submitting their reports, while in 2009 that increased to nearly half, including positive responses from firms such as BHP Billiton, Severn Trent and The Gap, PRI said.
“Companies that want to attract capital now recognise that reporting of issues such as carbon emissions and corporate governance is becoming as important as the reporting of traditional financial issues,” said executive director of PRI James Gifford.
“In the wake of the financial crisis, many investors believe that analysis of ESG issues is part of a more holistic approach to assessing a company and managing risk.”
