October, a European marketplace lending platform for SMEs has signed the United Nation’s “Principles for Responsible Investing.” October claims to be one of the first online lenders to agree to the “UN PRI.”
The UN PRI defines responsible investment as a “strategy and practice to incorporate environmental, social and governance (ESG) factors in investment decisions and active ownership.”
To quote the UN PRI site:
“There is a growing recognition in the financial industry and in academia that ESG factors influence investor returns. Explicitly and systematically including ESG issues in investment analysis and decisions – to better manage risks and improve returns – is called ESG integration.”
Today, more than 2500 individual corporations have signed the pledge.
The scope of the UN PRI ranges from environmental concerns such as climate change, resource depletion, waste, pollution, deforestation, to social impact including human rights, working conditions, training, and governance issues such as bribery and corruption, executive pay, board diversity, political and lobbying.
October states that every project on their platform will be “systematically screened for relevant environmental, social and governance.” Borrowing practices put in place by the potential borrowers will be assessed by October, according to the company. These criteria will be taken into account in the final scoring of the projects.
“Signing the UN PRI came naturally as we already follow ESG indicators in- house and have been since the beginning of our operations sensible to the type of projects we finance”, commented Olivier Goy, founder of October.