State-owned asset management firm the Public Investment Corporation (PIC) has been ranked among the top 30 asset management and sovereign wealth funds worldwide in the 2021 index by the Responsible Asset Allocator Initiative (RAAI) developed by US independent public policy think tank New America in partnership with the Fletcher School at Tufts University.

The leaders stand out for their commitment to responsible, long-term investing, the integration of environment, social and governance (ESG) risks into their portfolio decision-making process and leadership in reflecting savers' preferences on key issues, such as climate change, gender equality, fair labour practices, sustainable infrastructure, education and healthcare, New America said in its 2021 RAAI Leaders List.

The RAAI analyses and rates about 250 sovereign wealth funds and government pension funds, holding about $26-trillion in assets, on their responsible investing practices.

"The PIC welcomes the recognition by the RAAI for responsible investing. The PIC incorporates ESG into all its investment decisions.

"The PIC is a signatory to the United Nations Principles for Responsible Investments and the United Nations Global Compact, subscribes to the Code for Responsible Investment in South Africa and applies the King IV codes on good governance," the PIC said in a November 23 statement.

The PIC requires all investing companies to consider the United Nations Sustainable Development Goals (UN SDGs), including good corporate governance, ethics and the social and environmental impact of their business decisions and operations.

"PIC ESG teams delve into the core of investing companies' controls, sustainability strategy, social responsibility intent, transformation, empowerment and, ultimately, their commitment to stakeholders. This informs the PIC’s investment decisions and how it votes on proposals, including on executive remuneration, transformation and top management appointments, at annual general meetings of investing companies," it said.

The RAAI is focused on mobilising capital from the world’s largest asset allocators toward responsible investing and the achievement of the UN SDGs. The RAAI Index analyses how the world’s largest long-term investors, including sovereign wealth funds and government pension funds, are developing strategies to manage critical ESG issues along ten core principles and 30 detailed criteria.

The top group of asset allocators that earn leader and finalist rankings sets a global standard for leadership in responsible investing and provides a benchmark of excellence for the broader investment community to follow, New America said.

"Responsible investing is a critical component for solving the complex challenges facing the world today, and global asset allocators have the capacity to make a significant difference. Through publishing this biannual index, our main goal is to mobilise capital through systemic change for a more sustainable world," the think tank said.