A coalition of 130 institutional investors with combined assets of more than US$14 trillion has expressed concern that major corporations are not responsibly managing the fallout of the coronavirus pandemic due to a lack of transparency on vulnerable workers in their supply chains.
Despite progress in improving working conditions and pay in some parts of the world, there remains a huge gap in the amount of meaningful and publicly available corporate data on workforce matters worldwide, according to ShareAction, a campaigning organisation pushing to put responsibility at the heart of mainstream investment.
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With International Labour Organization (ILO) estimates that hundreds of millions of jobs could be lost as a result of the Covid-19 pandemic in the coming year, meaningful and comparable data has never been more important in ensuring the fair treatment of workers, the group says.
The group has reviewed the data submitted by 118 companies – including adidas, H&M, Inditex, Kering and LVMH – that participated in the Workforce Disclosure Initiative 2019 survey. The survey asks companies for information on topics including health and safety and labour rights for all types of worker – both in direct operations and in supply chains internationally.
Investors making the request include Amundi, Aberdeen Standard, PKA Denmark, Achmea, Vision Super, Candriam and Nest. The aim is to make workforces more sustainable in the long term.
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However, 85% of companies approached failed to respond, “offering little comfort that they are responsibly managing the fallout of the coronavirus pandemic on insecure workers with pre-existing policies and practices.”
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By GlobalDataCompanies generally have policies in place on responsible sourcing of staff and supply chain workers’ rights, but only 55% could provide evidence of acting on their commitment to respect supply chain workers’ rights.
“This is concerning since many workers in global supply chains could face income or job loss as a result of the pandemic,” ShareAction says.
“Only by first having full oversight of workforce governance structures, supply chains, and health and safety can companies fully account for and protect their labour force. This also allows investors to push for improvements in their policies and practices.”
The Workforce Disclosure Initiative also found:
- Companies are more willing to come forward with information on their permanent employees than for their contingent workforce, many of whom could have no access to sick leave or medical benefits, highlighting the vulnerability of insecure workers. Only 25% of companies disclosed how many contingent workers they employ.
- Companies do not appear to be collecting data relating to collective bargaining and union membership, undermining their ability to soothe labour relations which could be fraught at this time.
“The Covid crisis has really exposed which companies do well by their workers and which are failing to safeguard them in times of need,” explains Simon Rawson, director of corporate engagement at ShareAction. “Investors should be asking tough questions. It is essential that companies have good oversight of their workers, especially the most vulnerable.
“Meaningful transparency on workers can help protect them when crisis strikes. Our findings show that this data collection and reporting is not a priority for many of the world’s biggest companies. This needs to change.”
