Key Takeaways from the PRI Sustainable Finance Policy Conference in Tokyo

This month, the Principles for Responsible Investment (PRI) released a summary of the discussions from its annual Sustainable Finance Policy Conference held in Tokyo in October. As usual, this conference explored the latest developments in sustainable finance policy reform and highlighted new areas of focus for responsible investors. Some pivotal points around which participants generally agreed included:

· DNSH: The principle of do no significant harm (DNSH) should be preserved as a clear standard. However, participants acknowledged the importance of understanding that companies not reporting DNSH-related data should not automatically be perceived as compliant.

· Stewardship Challenges: Investment managers often lack clarity on when and how to escalate issues with investee companies and what resources are needed for effective stewardship. Additional challenges include the limited voice institutional investors tend to have in state-owned enterprises, particularly in APAC regions, and the continued ambiguity surrounding issues related to "acting in concert rules"

· Emerging Markets: Data collection poses a significant challenge in emerging markets, hindering comprehensive investor disclosure. Conference participants advocated for increased regulatory pressure in these markets and emphasized the necessity for more mandatory requirements to disclose negative impacts, such as PAI (Principal Adverse Impacts).