Fiduciary Duty in the 21st Century – Final Report

United Nations Environment Programme ; Principles for Responsible Investment (2019)

This report describes how the integration of environmental, social and governance (ESG) issues into investment practice and decision making is an increasingly standard part of the regulatory and legal requirements for institutional investors, along with requirements to consider the sustainability-related preferences of their clients and beneficiaries, and to report on how these obligations have been implemented. It also identifies areas where further work is required and reflects on how investors’ duties and obligations may further evolve over time. The report affirms that fiduciary duty requires the incorporation of environmental, social and governance (ESG) issues into investment analysis and decision-making processes. It also finds that investors that fail to incorporate ESG issues are failing their fiduciary duties and are increasingly likely to be subject to legal challenge. The final report includes discussion of the origins of fiduciary duty, the new policy context, and modern fiduciary duty. The report also provides detailed country-specific analysis of current policy and regulatory landscapes and recommendations for reform in each leading global economy.

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