$12trn of investors seek to ‘put the ‘S’ in ESG disclosure’ with letter on workforce engagement

The Workforce Disclosure Initiative is the latest project from ShareAction

More than 100 investors including Nordea, AustralianSuper, Schroders, UBS, Amundi, Legal & General and HSBC Asset Management have joined forces on the issue of companies’ workforce management, in a bid to increase transparency.

The $12trn group has backed a survey that’s been sent to 500 companies like Tesla, Apple and Alibaba, to request information on topics such as diversity, workers’ rights and health & safety in supply chains.

The letter is the latest effort from NGO ShareAction, via its Workforce Disclosure Initiative (WDI), which was launched last year in collaboration with the Responsible Investment Association Australasia and Canada’s Shareholder Association for Research and Education. It was created in response to what ShareAction described as “investor concerns that the quality of data from companies about workforce management is both weak and inconsistent between comparable firms”. The ultimate goal, it added, was to improve the quality of jobs I the operations and supply chains of multinational companies – reflecting Sustainable Development Goal 8, Decent Work for All.“We very much welcome the WDI initiative to better integrate the S in our investment case,” said Matt Christensen, Global Head of Responsible Investment at AXA IM. “As companies have been reinforcing their disclosures on environmental topics over recent years, we wish to see a similar effort with social factors. Companies should disclose data that is material, consistent and comparable enough to truly understand their approach to workforce management in their annual reports.”

The latest request for information targets firms headquartered in 30 countries across the world, chosen because of their significance within one of 11 sectors, and the size of their workforce. They have until 22 October to respond to the letter.

In its pilot year, the WDI engaged Anglo America, Compass Group, GSK, International Consolidated Airlines Group (which owns British Airways), Microsoft, Sainsbury’s and Saint Gobain, among others.

“Investors will pay close attention to working with companies which encounter barriers to disclosure,” the WDI warned.