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Church of England investing bodies issue new human-rights policy

21 May 2021

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THE National Investing Bodies (NIBs) of the Church of England say that they intend to use shareholder leverage to ensure that the companies in which they invest are committed to international standards of human rights.

The NIBs — the Church Commissioners, CBF, and Pensions Board — released a new human-rights policy on Monday, based on advice from the Church’s Ethical Investment Advisory Group (EIAG), which was published in the same document.

The policy outlines new expectations of businesses “to demonstrate consciousnesses with regards to human rights through an active commitment to ensure that they prevent or mitigate the risk of adverse impacts on human rights in all their activities”. This will be implemented by the NIBs through data, research, prioritisation based on saliency, and reviewing outcomes and reporting to trustees, they say.

The policy does not state that the NIBs will resort to disinvestment should companies not adhere. It says: “We seek to build and use leverage to ensure portfolio companies fulfil our human rights expectations. We will use leverage through our investment decision making, stewardship activities, collaborations with other investors and policy dialogue.

“We expect and encourage companies in which we invest to have a human rights policy, due diligence process, meaningful disclosures, a grievance mechanism for human rights related concerns to be raised and to provide remedy where they cause or contribute to harm. This ought to apply throughout its operations and supply chains.”

In the documents, the EIAG provides 16 pages of advice to the NIBs on maintaining human-rights standards in the “increasingly complex global economy in which the Church of England invests”. It says: “All companies, in any industry, in any country can have an impact — either positively or negatively — on human rights through how they treat their customers, employees, contract workers, their supply chains and the local communities in which they operate.

“As such, investors can be connected to a wide range of human rights risks which are caused by, contributed to, or linked to the companies they invest in.”

The EIAG does not, however, “expect investors or companies to completely eradicate all the human rights risks that they may be exposed to. . . In practice, this means the EIAG advises the NIBs and the portfolio companies in which they invest to endorse the human rights expressed in the UN Guiding Principles on Business and Human Rights.”

Instead, it points to the scheme Find It, Fix It, Prevent It, which was launched in 2019 by CCLA (News, 15 November 2019) and encouraged 13 of the largest listed hospitality companies to examine modern slavery in their supply chains (News, 16 April). It advises: “It is within this context of transparency, accountability and justice that the EIAG advises the NIBs to be a ‘force for good’ in their engagement with portfolio companies to help them to recognise the risks with their businesses and supply chains and to respond fruitfully.”

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