Investors Push for Human Rights Data
The Investor Initiative on Human Rights Data will target big data and proxy houses to support just transition to a nature-positive and net zero world.
The Church Commissioners for England, together with Aviva Investors and Scottish Widows, has launched an initiative aimed at improving the quality of corporate human rights data available to investors.
The three organisations initially came together in 2022, as part of the World Benchmarking Alliance’s Social Collective Impact Coalition (CIC), to equip investors in taking systematic action against businesses which fail to meet societal expectations on human rights.
Building on the work of the Corporate Human Rights Benchmark (CHRB) and the Investor Alliance for Human Rights (IAHR), in 2023 they convened a multi-trillion dollar collaborative engagement programme with ESG data providers.
Now, the Investor Initiative on Human Rights Data (II-HRD) is continuing these efforts and is designed to help investors in their stewardship and voting decisions.
II-HRD has three high-level objectives including improving the depth and breadth of corporate human rights data available to investors via proxy advisors’ voting policies and advice and via data providers.
With the latter there will be a focus on the universal coverage of listed companies’ efforts to implement human rights due diligence and their policy-level commitments to respect human rights. The third high-level objective is to generate industry-wide alignment on the principles of assessing the presence of and response to corporate ‘norms breaches’.
Systematic action on human rights
The initial target companies of II-HRD will be big ESG data providers MSCI, Morningstar-Sustainalytics, Moody’s, LSEG Group’s Refinitiv, Bloomberg and RepRisk. Influential proxy advisors Institutional Shareholder Services and Glass Lewis will also be targeted.
“We expect companies that we invest in to respect human rights. This is key to addressing social inequality and achieving just transitions to a nature-positive and net-zero world. But without the right data, for the right companies, it is hard for investors to hold companies accountable,” said Dan Neale, Social Lead at the Church Commissioners for England.
“This initiative will help investors take systematic action on human rights, in support of inclusive economies and long-term value creation.”
II-HRD is looking for investors to sign up as members and dedicate resources or register as endorsers by the end of April.
It comes as engagement on human rights risks moves up the agenda for investors. The UN Principles for Responsible Investment launched Advance in 2022, which facilitates investor engagement with key companies in the metals and minerals and renewables sector on human and workers’ rights. Among the focus companies named by PRI are mining giants Anglo American and Rio Tinto, along with German energy group RWE, world number two in offshore wind power and Europe’s third-largest renewable energy supplier.
The approach taken by investors varies across sectors and regions, but participants will set three high-level expectations for focus companies: implementation of the UN Guiding Principles on Business and Human Rights, alignment of political engagement with their responsibility to respect human rights, and progress on the most severe human rights issues in their operations and across their value chains.
Last month, the Taskforce on Social Factors (TSF) unveiled final guidance to help UK pension fund trustees to improve their assessment of social factors in investment decisions and stewardship activities.
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