The Esri projection engine, pe.dll, is used for coordinate system, map projection, and datum transformation functionality. The library includes a database of predefined objects including coordinate systems and transformations. The PEOBJEDITHOME system environment variable allows the definition of custom objects through text files.
In ArcGIS for Desktop 10.1 and ArcGIS for Server 10.1, the PEOBJEDITHOME variable is not working with localized versions such as the Russian language version.
The processing of the PEOBJEDITHOME files was not updated properly when the functionality was added to support localizing coordinate systems at ArcGIS 10.1.
Example: If PEOBJEDITHOME's value was set to C:\CustomCRS, the value for PEDATABASE is: