Preheat oven to 400. Combine brown sugar, butter, and peaches in a baking dish, and bake for 15 minutes, or until peaches are soft and caramelized.
In a medium-sized pot, combine arborio rice, 1 ½ cups milk, white sugar, and a pinch of salt. Simmer over medium heat, until rice has absorbed the milk.
In a small bowl, whisk the egg, and add a small spoonful of rice to temper it.
Add remaining ½ cup milk, vanilla extract, egg, and cinnamon to pot of rice. Stir and cook for 1-2 more minutes, until pudding is thick and creamy.
To serve pudding, place in individual serving dishes and top with a slice of caramelized peach. If desired, garnish with basil.