There is increasing awareness among investors of the important role that responsible investing plays in a well-diversified portfolio. Fiduciaries today recognize that environmental, social and governance (ESG) risk factors can materially impact portfolio performance, as well reflect an organization's broader values. The difficulty lies in knowing how to integrate ESG principles and where to begin. In this three-part series, we’ll look at how you can start building a robust responsible investing framework for your organization
Responsible investing at Russell Investments
We’re a signatory to the United Nations-supported Principles for Responsible Investment (PRI). That means Russell Investments has a firm commitment to responsible investing and we recognize its importance to our investment process. We believe ESG issues drive value and mitigate risk, and that responsible investing and performance can be complementary.
Principles of good stewardship are integrated throughout our investment process, via our research efforts, portfolio management and implementation of proprietary investment solutions. We support our clients integrating ESG issues into their investment process, while acknowledging that these priorities might be different for every investor.
Responsible investing roadmap: Best practices
From our experience, we recommend five key steps on overarching best practices for establishing a responsible investing framework.
1. Educate your team
You must educate yourself and your board (or investment committee) on the meaning of responsible investing. You’ll need to be aware of the latest trends and the different kinds of implementation strategies. It's critical to prepare your team members and supply them with knowledge to make informed decisions.