Microfinance Focus April 27, 2011: The Netherlands Development Finance Company (FMO) recently signed the United Nations Principles for Responsible Investment (UNPRI).

UNPRI provides framework for investors to incorporate environmental, social and corporate governance (ESG) issues into investment decision-making and ownership practices, enabling them to align their objectives with those of society at large.

The UNPRI covers aspects such as supporting development of ESG-related tools, metrics, and analyses, developing and disclosing active ownership policy consistent with the Principles, participating in the development of policy, regulation, and standard setting (such as promoting and protecting shareholder rights), asking for standardized reporting on ESG issues (using tools such as the Global Reporting Initiative) and supporting regulatory or policy developments that enable implementation of the Principles. In addition, the principles also include working towards enhancing effectiveness in implementing the principles and reporting activities and progress towards implementing the principles.

FMO has been incorporating the ESG principles for over 40 years.  The development bank offers discounts on loans to clients who make further sustainability expansion in their businesses.

By signing the principles, FMO emphasized its commitment to fair treatment and protection of the interests of the ultimate client in inclusive finance - low-income households and small and medium enterprises.