$4T Investor Group Backs UN Human Rights Initiative

Swedish and Dutch pensions are among a 60-strong group of investors calling for companies to take into account the risks of failing to uphold employees’ human rights.

Major European investors including Dutch and Swedish pensions are calling for more companies to promise to uphold workers’ human rights, as part of a $4 trillion investor group.

APG, PGGM, AP1, AP2, AP3, and AP7 have all backed a new tool, the United Nations Guiding Principles Reporting Framework, which enables companies to assess and report their performance on human rights.

“There is no question that human rights issues are frequently material to the financial performance of many companies.” —Steve Waygood, Aviva InvestorsAlong with other co-signatories including religious groups and asset managers, the pensions argued that failure to engage with human rights issues could face “face potential legal, reputational, and other financial risks”.

“Meaningful disclosure of human rights performance can play a significant role in reducing a company’s human rights risks,” the investor group said, “contributing to a company’s competitive advantage, and strengthening its long-term financial stability.”

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Such actions could provide more access to business opportunities, the group claimed, as governments, customers, and buyers would “recognize the reduced risks to themselves”. Actively upholding human rights could also improve a company’s “ability to preserve reputation when negative impacts occur”.

“There is no question that human rights issues are frequently material to the financial performance of many companies,” said Steve Waygood, chief responsible investment officer at Aviva Investors and a signatory to the group.

“Long-term investors want to be able to benchmark corporate performance in this area, however this is not at all easy to do. This framework is a very welcome step in absolutely the right direction.”

Research published this month reported that private equity groups were coming under increasing pressure from investors to incorporate environmental, social, and governance criteria into their portfolios and processes.