“Signing the [United Nations Principles for Responsible Investment (UNPRI)] just was a natural extension of our investment approach,” Maria Wilton, managing director of Franklin Templeton Australia, told InvestorDaily.
To support this, Franklin Templeton, a recent UNPRI signatory, has also expanded its ESG team.
“[We have] brought on some additional resources just to sharpen our focus there and really to support the statement of principles with actual real resources,” Ms Wilton said.
Signatures to the PRI are popular within the industry; however, Templeton worry this is not backed up with adequate ESG resources.
“A lot of managers have signed on, and it has been a popular thing to sign on to from a sales and marketing perspective and our approach is that it is fundamentally not a sale and marketing pitch, but it is an investment issue,” Ms Wilton said.
Templeton see the issue as being quite acute among retail investors.
“I think responsible investing in the UNPRI has been an issue for quite some time for institutional investors; it has been less of an area of focus on the retail side,” Ms Wilton said.
Templeton believes this is likely due to the fact that ESG analysis has not been as fundamentally ingrained among these investors.
However, the firm speculates that retail investors “might move closer to the institutional side of the market over time”.
Templeton also believes the UNPRI should be seen as an opportunity for the investment community to incorporate ESG analysis into risk decisions and strategies.
“I think that ESG is seen as an investment issue, a mainstream investment issue...I think that that is the correct place for it,” Ms Wilton told InvestorDaily. “The PRI is a framework that will encourage investors to see ESG in that light.”
