Principles for Responsible Investment (PRI)

The EU Taxonomy helps investors channel capital towards sustainable activities by providing a common language to guide such investments . In 2024, over half of EU-based asset owner PRI signatories reported using the EU Taxonomy to identify sustainability outcomes connected to their investments .

The PRI welcomes the European Commission and EFRAGs efforts to simplify the ESRS while preserving decision-useful disclosures for investors. It is broadly supportive of the proposal, noting it maintains most of EFRAGs technical advice and achieves simplification through editorial changes, consolidation of requirements, and a 60% reduction in datapoints, while retaining key information.

The PRI welcomes the European Commissions proposal to target a 90% reduction of net GHG emissions by 2040. More than 150 companies, investors and organisations call for a target of at least 90% to decarbonise the economy and strengthen its competitiveness, innovation, and resilience to shocks and energy security.

TAXONOMY The PRI welcomes the proposal to establish a framework to facilitate sustainable investment. We believe the taxonomy will create additional demand for and supply of sustainable financial products by simplifying, and as such, enabling, the investment of private capital in economic activity consistent with the EU’s sustainability objectives.

REGULATION ON DUTIES AND DISCLOSURES RELATING TO SUSTAINABLE INVESTMENTS The PRI considers the Commission’s Investor Duties and Disclosures proposal (2016/2341) critical for the success of its sustainability objectives.

The PRI is a membership organisation of over 2000 global institutional investors, (including insurers, investment managers and advisors) with approximately US $82 trillion in assets under management. Over 1000 of these signatories are based in the Europe. The PRI strongly supports all four of the Commission’s recent regulatory proposals.

The Principles for Responsible Investment (PRI) believes that dialogue between investors and clients on ESG interests and preferences is a necessary to a sustainable financial system and we welcome policy initiatives to encourage this dialogue.

The PRI welcomes the revision of the Energy and Climate Governance consultation. To support the EU energy and climate transition, investors need coherent policies, corporate transition plans, and sustainability information.

PRIs key recommendations are: 1. Remove barriers to voting and submitting shareholder proposals Remove obstacles to proxy voting. In many EU member states, investors face Power of Attorney (PoA) requirements that need to be submitted as physical copies and processed manually.

The PRI welcomes the review’s focus on addressing long-term sustainability risks in the insurance sector. However, more ambitious measures will be needed to align financial flows with the EU’s new sustainability objectives. ■ The reform’s aim to strengthen insurers' management of climate risks is particularly welcome.