Global Alignment on definitions of responsible investment approaches

Growing global interest in responsible investment demands greater standardization of terminology to enable institutional investors, regulators, and other industry participants to communicate with precision.

In November 2021, the International Organization of Securities Commissions (IOSCO) highlighted the need for the global investment industry “to develop common sustainable finance-related terms and definitions, including relating to responsible investment approaches, to ensure consistency throughout the globalasset management industry.”1

In response, CFA Institute, the Global Sustainable Investment Alliance (GSIA), and the Principle for Responsible Investment (PRI) came together to harmonize definitions for the following responsible investment terms:

• Screening
• ESG integration
• Thematic investing
• Stewardship
• Impact investing

This resource is intended for investors, regulators, policymakers, and other market participants.

It describes the concepts that define each responsible investment approach, rather than criteria for product labeling or categorization. The responsible investment approaches defined in this paper are not mutually exclusive and, in practice, are often used in combination. This resource aims to harmonize existing terms and definitions—not create new terms or meanings.