What in the world is IORP?

If you live in the US, or are not focused on institutional investing with integrated ESG analysis, IORP might as well be the name of one of Jupiter’s moons. However, this directive is one of those bureaucratic levers that is a Very Big Deal.  The overhauled IORP legislation has potential to shift the default setting for investment practice of European pension funds, and by extension, for much of global institutional investing.

The IORP (Institutions for Occupational Retirement Provision) Directive mandates that all workplace pensions integrate analysis of ESG issues (environmental, social, and governance) into decision making. This is yet another confirmation that fiduciary city and ESG analysis are aligned, not contradictory.

The legislation has been passed by a majority in the European Parliament, which means that individual countries have two years to pass national law. Assets under IORP are E2.5 trillion on behalf of 75 million workers.

With thanks to our friends at TerraAlpha for highlighting this issue! This article and this one have more detail.

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