The Principles for Responsible Investment has delisted four investment firms and one pension fund for failing to meet its minimum requirements for signatories.
In 2018 the PRI put in place three requirements, stating that failure to meet them over a two-year period following extensive engagement with the organization would result in delisting.
The requirements are that investment policies cover the signatory's approach to responsible investment, internal or external staff are responsible for implementing the policy and there are senior-level commitment and accountability mechanisms for the policy to be implemented.
Signatories are delisted as a last resort if they have not met the requirements after a two-year period, including engagement with the PRI.
The organization said Monday that it had identified 165 signatories as not meeting its requirements in 2018 and entered the first year of engagement with them. In 2019, 69 began a second year of engagement, with 10 entering a one-month appeal period in 2020.
The firms delisted are the $40 million Stichting Gemeenschappelijk Beleggingsfonds FNV, Amsterdam; the $5.1 billion BPE — the private banking unit of La Banque Postale; Indonesia's $140 million Corfina Capital; and $50 million French money manager Delta Alternative Management.
The fifth firm delisted was $310 million Primary Wave IP Investment Management, a New York-based money manager. However, a spokeswoman for Primary Wave said: "We were excited to be an early member of PRI and remain fully supportive of its initiatives. There was an administrative miscommunication on a questionnaire, and we intend to rejoin in 2021."
A BPE statement said the private bank had been a signatory since 2014 and that 90% of its assets integrated a socially responsible investment policy.
However, for legal reasons, "BPE has not been able to fully comply with one of the six fundamental principles of the PRI regarding discretionary management. In fact, BPE does not legally own listed securities held on behalf of its client (assets under management). Therefore, it is only able to participate in general meetings and vote on resolutions in accordance with ESG principles."
BPE is working on resolving the legal constraint to adhere to PRI requirements, the statement added.
Spokesmen for GBF, Corfina and Delta could not immediately be reached for comment.
A spokesman for the PRI said that, the two-year process to delist firms will now be shortened to one year.
