Sustainable and Responsible Investing (SRI) is a growing trend among investors who consider not only financial criteria but also the environmental, social and corporate governance (ESG) practices of companies. Within Tudor's INNOFINANCE programme, EMISSAIRE aims to develop an analytical framework for assessing the responsible approach and leveraging the sustainable performance of SRI funds.
The SRI market has experienced major growth over the last decade, with over EUR 5 trillion in European SRI assets under management at the end of 2009 (Eurosif, 2011). Despite this growth, the definition of “Sustainable and Responsible Investing” remains quite vague and many different approaches exist on the market. There are also transparency and reporting issues regarding the responsible approach and extra-financial performance of SRI funds. In order to provide credibility to the SRI concept, there is a need for better assessment and reporting regarding their responsible approach.
These issues are at the core of Tudor’s EMISSAIRE project, which looks at the responsible approach as a lever of sustainable performance, and explores the interactions between SRI stakeholders. The project aims to develop a science-based and independent analytical framework that include a set of performance indicators to assess the responsible approach of SRI funds. The convergent and divergent points of view of SRI stakeholders will be considered through a dedicated survey. In parallel, the project also aims to model the SRI value network, identifying the roles and responsibilities of each SRI stakeholder.
The EMISSAIRE framework aims to promote the development of SRI funds by providing best practices for the implementation, assessment and reporting of the responsible approach of SRI initiatives. By focusing on the responsible approach of SRI funds, the framework will act as a complement to other initiatives that consider the extra-financial performance of the portfolio. It could be used internally to improve and report on the responsible approach of SRI funds. In addition, the EMISSAIRE framework could be used externally by stakeholders when assessing SRI initiatives. This is particularly relevant for fund of SRI funds structures. There is also the potential for the EMISSAIRE performance indicators to be adopted by a labelling or rating company. Finally, this project aims to contribute to increasing Luxembourg’s profile in the field of SRI. funds.