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Reporting on Dalriada Trustees’ first year as a PRI signatory
5 March 2021

Reporting on Dalriada Trustees’ first year as a PRI signatory

Insight Partner

Dalriada Trustees became a signatory to the United Nations Principles of Responsible Investment (PRI) in September 2019, the first Professional Trustee firm in the UK to do so. Over the last year or so we have been working to better incorporate Environmental, Social and Governance (ESG) factors both within how we undertake our role as trustee and in how we operate internally.

As we begin our first round of PRI reporting this month, we have reflected on our first year as signatories and noted some of the things we have learned below.

This is a journey

There is no quick fix to account for ESG within your investments. It is not as simple as switching to an ESG tilted fund. While this may be a reasonable action, the market for such funds is not well developed and by rushing to address ESG through fund choices we risk setting off on the wrong path. Our goal as trustee is to truly embed ESG factors into our processes. By this we don’t just mean fund selection, but all the strategy considerations that come before selection and all the monitoring that comes after. We want ESG factors to become a business-as-usual investment consideration, much like interest or inflation rate hedging, rather than a separate aspect. We have learned that we need to walk before we can run.

As a reminder, there are six Principles within the UN PRI Framework:

1. We will incorporate ESG issues into investment analysis and decision-making processes.

2. We will be active owners and incorporate ESG issues into our ownership policies and practices.

3. We will seek appropriate disclosure on ESG issues by the entities in which we invest.

4. We will promote acceptance and implementation of the Principles within the investment industry.

5. We will work together to enhance our effectiveness in implementing the Principles.

6. We will each report on our activities and progress towards implementing the Principles.

Principles 1, 2 and 6 focus on integrating ESG into investment analysis and implementation and improving our disclosures in this area. Working on these three Principles has been a particular challenge as many of the tools in the marketplace, and much of the fund selection approaches, do not adequately cover the spirit of what the Principles are trying to achieve. As a Professional Trustee we need to do more, but it is also clear that greater effort is required from both consultants and investment managers before integration of ESG becomes mainstream.

Quality and availability of data is a barrier

The quality and availability of data is one of the main barriers to incorporating ESG and climate change into our investment strategies. 

Significant development is required along the full investment chain and so we are unlikely to have reliable ESG data in the short term. Until then, we will have to rely on a qualitative approach to understanding ESG and climate risks across our potential investments, become comfortable with using what data is available, but ensure we carefully consider the impact of any uncertainties.


The increased focus on ESG and climate change in regulation is a positive step forward. If not for the recent regulatory requirements, many trustees would not yet have started on this journey. At Dalriada we believe that, to get the most benefit from the new regulations, it is important that we do not take a tick box approach. Instead, we have worked hard to embrace the spirit of the regulation in how we have approached this across our Trustee cases. It is also clear that there will be further regulatory updates in this space. Our expectation is that focusing on the why, rather than the what, will help to futureproof our processes.

However, we cannot ignore what a remarkably strange and difficult year this has been for everyone. While many trustees had plans to go above and beyond the regulatory requirements, the pressures from the pandemic may have forced them to change direction.

We have recognised in our responses to regulatory consultations that, whilst we agree with the spirit of the changes, it is important for those setting regulation to appreciate that a lot of small scheme trustees will have limited resources and will ultimately rely on their advisers. We must find a way to set regulation so that the outcome is not simply more cost falling on the schemes. We strongly believe that placing more responsibility on all parties within the investment chain can support this aim.

Take a step back to see the big picture

When we are going through the investment process it is important that we take a step back and think about each element. With the new Implementation Statement requirements, the Statement of Investment Principles (SIP) has become even more important. These new requirements lead us to consider the SIP in a different way, as more of an objective setting document guiding the strategy and implementation rather than a last step documentation exercise.

As we look forward to the coming year, we are excited to the take the next steps in this journey and are optimistic of the progress we can continue to make towards supporting the PRI principles.


This article was featured in Pensions Aspects magazine March 2021 edition

back to Pensions Aspects Magazine

Last update: 27 April 2021

Clár Christie
Clár Christie
Dalriada Trustees Trustees
Responsible Investment Officer

Interim Pension Officer/Manager - In House 18m FTC

Salary: £50000 - £70000 pa

Location: Northamptonshire

Pensions Administrator - W. Yorkshire

Salary: £23000 - £29000 pa

Location: West Yorkshire

Pensions Administrator - Hampshire

Salary: £20000 - £30000 pa

Location: Hampshire

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