Trade & labour rights
Driven by ever-increasing competition, businesses are under more and more pressure to lower prices, whilst at the same time upping profits. In this climate, it is often the people who produce the goods we buy who lose out, and stories about the poor working conditions and protection of these workers are well documented.
We push the companies in which we invest to take a responsible approach to labour rights in their operations and supply chains, and to ensure that workers' health, safety and welfare are respected.
Our policy statement on Trade & labour rights
We will seek to:
- protect workers from exploitation, e.g. oppose child labour.
- support poverty reduction, e.g. encourage the adoption of Fair Trade or ethical trading principles.
- advocate an end to trade which fuels conflict or undermines human rights, e.g. displaces people from their lands.
- encourage the promotion of co-operative enterprises.
Our policy in practice…
Protecting workers' rights at First Group
When we co-filed a shareholder resolution at First Group plc, the UK's largest transport company, we became the first UK institutional investor to sign up to a shareholder resolution on a labour rights issue. The resolution required the implementation of a workplace human rights labour policy across the company's entire operations, as there were allegations of anti-union practices by the management of the company's US subsidiary, First Student. Prior to the annual general meeting, we chaired a meeting with the company and other institutional investors to discuss the issues and sought commitments to address shareholders' concerns. At the AGM on 13th July 2006, our Head of Responsible Investment, Ian Jones, proposed the resolution and votes cast indicated that over 21% of the shareholders supported the resolution. This was a significant result as, historically, shareholder resolutions in the UK have not been supported at this level. The company committed to review their procedures and have since adopted a new group-wide Corporate Social Responsibility policy.
Making Change Over Time
We believe that buying low cost goods at the expense of workers' health, safety and welfare is not only morally wrong, it is also unsustainable in business terms. We worked with the ethical trading consultancy Impactt to produce a report that promotes a new approach to improving labour practices, focused on change over time, rather than simple audit compliance. It showed that such changes can have a positive impact for suppliers and purchasers, as well as workers. We have contacted 120 international companies in which we invest, to highlight the report and will provide practical support for companies to incorporate changes throughout their supply chains.
