Socially Responsible Investing - What Fiduciary Investment Boards Need to Know

Socially responsible investing (SRI) (also called sustainable, responsible, impact investing) is growing in markets around the world.  It offers investors the opportunity to ensure that their investments align with their mission and values and is part of a wider movement to make the global financial system more effective in mobilising capital towards an environmentally sustainable and socially inclusive economy, that is, sustainable development.  As SRI is becoming better understood and more widely accepted, the historic barriers to SRI, such as the belief that it is inconsistent with the fiduciary obligation of loyalty to beneficiaries because it has a negative impact on returns, are being challenged and arguably dismantled.

This paper aims to help those boards charged with overseeing investments for the benefit of others (i.e. fiduciary boards) in the Pacific sovereign wealth fund, philanthropic, charities and Māori sectors (for the purpose of this paper, Investment Stewards) understand what SRI is and how it fits in with their fiduciary obligations and investment governance practices. 

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