The Irish National Pensions Reserve Fund is getting a rough ride at the moment. Having been forced to pick up the tab for the recapitalisation of the Irish banks (some €7bn worth of preference shares in Bank of Ireland and Allied Irish Banks), it is about to lose its chief executive, John Corrigan, who moves upstairs to replace his boss, head of the National Treasury Management Agency, the NPRF’s parent body.
This will not be a pleasant job, but nor will running the NPRF. As well as easing in a new chief executive, it has to work on reconciling its responsible investment policy (it has signed up to the UN Principles for Responsible Investing and is a member of the Carbon Disclosure Project) with its legal mandate to “secure the optimal total financial return provided the level of risk to the moneys held or invested is acceptable”.
According to human rights advocate Mark Cumming, the contradiction between this and the NPRF’s own stated intention to “incorporate ESG factors into investment research, analysis and decision making” stands in the way of its developing coherent policies.
If the Irish government can push through amending legislation requiring the NPRF to bail out the banks, surely it should be able to rewrite the NPRF’s mandate in order to allow it to take long term non-financial risk factors into account and ensure Irish pensioners will not profit from destructive corporate practices such as human rights abuses or uncontrolled environmental damage.