Principles for Responsible Investment
ESG integration and stewardship expectations for institutional investors
Launched
2006
Governed by
PRI Association (London, United Kingdom); supported by UN Environment Programme and UN Global Compact
Audience
Institutional investors — asset owners, investment managers, service providers
Mandatory
Voluntary
Report Format
Annual Reporting Framework — signatories report against the six PRI principles; scores published publicly
Update Cycle
PRI Reporting Framework updated annually; last major revision: PRI reporting update 2023
Voluntary for asset owners and managers; 5,000+ signatories managing $120T+ AUM
Overview
The UN-supported Principles for Responsible Investment (PRI) is a voluntary initiative for investors that have committed to incorporating ESG factors into their investment and ownership decisions. With over 5,000 signatories representing $120T+ in assets under management, PRI is the dominant global framework for responsible investment. PRI signatories commit to six principles covering ESG integration, active ownership, disclosure, industry promotion, regulatory engagement, and reporting.
Why It Matters for ESG Analysis
For companies seeking investment, understanding what PRI signatories require helps them prioritise their ESG disclosure. PRI signatories are obligated to engage with portfolio companies on ESG issues and to exercise voting rights in alignment with long-term value creation. A company with weak ESG disclosure is at greater risk of ESG-motivated divestment or shareholder resolutions by PRI-signatory investors.
Key Requirements
Principle 1 — ESG integration
requiredIncorporate ESG issues into investment analysis and decision-making processes
Principle 2 — Active ownership
requiredExercise ownership rights and practices that reflect ESG considerations
Principle 3 — Disclosure by investees
requiredSeek appropriate disclosure on ESG issues from investee entities
Principle 4 — Industry promotion
requiredPromote acceptance and implementation of PRI principles in the investment industry
Principle 5 — Effectiveness
requiredWork together to enhance effectiveness in implementing PRI principles
Principle 6 — Reporting
requiredReport on activities and progress towards implementing PRI principles
PRI's role in ESG stewardship
PRI is primarily an investor framework — not a company reporting standard. Its importance for companies is indirect: PRI signatories are required to conduct active ownership (engagement and voting) on ESG issues. This means a PRI-signatory investor managing €10B in shares has a formal obligation to engage with portfolio companies on ESG matters and to vote shares in alignment with long-term sustainable value creation. ESG-weak companies face increasing stewardship pressure from PRI signatories.
The annual reporting assessment
PRI signatories must complete an annual reporting assessment across modules covering investment strategy, governance, policy, and practice for each asset class. Signatories are scored from 1–5 on each module, and scores are publicly available. Poor performance over two consecutive years can result in PRI de-listing — a significant reputational and potentially regulatory consequence for investment firms.
Impact on company ESG strategy
The growth of PRI signatories has created a powerful feedback loop: investors with $120T+ AUM require ESG data from companies, which creates incentives for companies to improve ESG disclosure. PRI signatories use direct engagement letters, proxy voting, and collaborative engagement programmes (such as Climate Action 100+) to push for board-level climate risk oversight, Scope 3 disclosure, and executive pay linkage to ESG targets.
Common Misconceptions
PRI is for investors, not companies. Companies are not PRI signatories — their investors may be.
PRI signatory status does not mean an investment firm is a sustainable investor — it means they have committed to a process, not to a specific ESG outcome.
PRI scores are self-assessed and reported — they are not independently audited in the same way as financial accounts.
How OpenESG Scores PRI
OpenESG tracks which major institutional shareholders of each company are PRI signatories. Companies with a high proportion of PRI-signatory shareholders face greater stewardship pressure for ESG improvement and are more likely to receive climate-related shareholder resolutions.
Related Frameworks
TCFD
Task Force on Climate-related Financial Disclosures
The four-pillar framework for climate risk disclosure — now superseded by ISSB
Learn moreSBTi
Science Based Targets initiative
1.5°C-aligned decarbonisation pathway validation for corporate targets
Learn moreUN GC
UN Global Compact
Ten principles on human rights, labour, environment, and anti-corruption
Learn more