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Commonly asked questions

Why is the PRI well placed to coordinate such an initiative?

The PRI is a network of over 4000 signatories who collectively manage more than US$100 trillion in assets under management. The PRI executive has been coordinating investor stewardship initiatives for 10 years, including prior collaborative engagements on human rights within specific industries, including within cobalt sourcing , agricultural supply chains and the extractives industry , as well as more recently playing a key role coordinating collaboration within Climate Action 100+ , the world’s largest investor collaborative engagement.

As a UN-supported body, the PRI has a strong commitment to progress on human rights and the UN Guiding Principles, as most recently articulated in our position on human rights and 2021-2024 strategy .

The PRI will work closely with organisations coordinating similar initiatives, to ensure alignment and avoid duplication of efforts.

How will the PRI work with existing collaborative initiatives?

We will work closely with existing investor initiatives to ensure that we are not duplicating efforts or sending mixed messages to issuers – which may undermine broader investor efforts. For example, we have a Collaboration Agreement with the Investor Alliance for Human Rights (IAHR). Given the complementary nature of both Investor Alliance and PRI’s  work on the investor responsibility to respect human rights in their investment activities, and in light of the vast effort that lies ahead to address these responsibilities across various asset classes and investments in different sectors, coordination between the organisations will be beneficial both to achieving the strategic objectives in this regard and to improving the human rights situation of people around the world. Coordination will also ensure that Investor Alliance and PRI deploy their resources in a way that is synergistic and minimises the likelihood of engaging in duplicative efforts or working at cross-purposes. The Collaboration Agreement is intended to ensure positive collaboration and further each organisations’ strategic objectives.

Will the PRI introduce a benchmark framework, similar to Climate Action 100+?

At present, the PRI will rely on existing public benchmarks (such as those developed by the WBA), rather than developing our own benchmark.

When will additional sectors and companies be included?

Additional sectors/companies will be included on the focus list from 2024

Why was political engagement singled out as a focal point for investors?

  • Under the first set of expectations around full implementation of the UNGPs, all stakeholder engagements should be respectful of human rights, however, more often than not, this is an area where companies’ political activities go against their stated commitment to respect human rights.
  • Corporate political engagement that is not undertaken in a responsible manner (including indirect activities - indirect lobbying activities include membership in or links to trade associations and business groups; engagement in international or national business alliances or initiatives; contributions to external, or non-governmental organisations) often undermines efforts to achieve global respect for human rights.
  • Public policy is a necessary tool to ensure the implementation of the UNGPs. Policy can help support global human rights aims both directly – e.g. minimum wage regulation and freedom of association regulation – but also indirectly, through enabling of better governance – e.g. through mandatory due diligence legislation, protecting the voice of indigenous communities, protection of voting rights for minority communities and elimination of corruption and other forms of policy capture.
  • Long-term universal investors (i.e. diversified investors) have an interest in the policy engagement of portfolio companies being aligned to their interests in regulation that protects human rights.

How will human rights issues at each company be prioritised?

For each company, the PRI with input from the advisory groups and right-holders and affected stakeholders – will identify (and agree with each lead investor/s) which issues should be prioritised for engagement by assessing where actual or potential negative outcomes for people are most severe using the criteria set out in the UNGPs

  • Scale: gravity of the actual or potential outcome on an individual right(s) (“how serious is the harm”?)
  • Scope: the number of individuals that are or will be affected (“how widespread is the harm?”)
  • Irremediable character: any limits on the ability to restore those affected to a situation at least equivalent to their previous situation (“if the harm occurs, can it be put right?”)

What are the specific activities for engagement?

We expect that activities such as sending investor letters and holding company engagement meetings will form part of the engagement. Ultimately, it is the responsibility of the lead and collaborating investors to develop an engagement strategy that is suitably ambitious and effective to drive change around the objectives of the initiative.

Are investors required to vote and escalate engagements a certain way?

No. We encourage investors to be assertive through their stewardship activities, but we will not state that an investor should engage or vote in a certain way. The PRI will encourage investors to develop an engagement strategy and consider the different tools available to them, should they need to escalate an engagement, but investors are always responsible for making their own escalation and voting decisions.

How will right-holders and affected stakeholders be included within engagements?

The PRI in collaboration with lead investors and with input from the technical expert group will identify and consult stakeholders who have or may be affected by companies (such as local communities and workers). Leading investors within the industry already do this, and it is particularly important when a controversy occurs that requires investors to be reactive.

Obtaining first-hand information from key stakeholders will complement the human rights impact assessment conducted by the company itself and other public information available. This will help investors to understand and incorporate information about actual risks and outcomes experienced by stakeholders in individual engagements.

What role will investor policy engagement play in the initiative?

Both investor engagement with corporates and public policymakers are necessary to pursue the objectives of this initiative. It is recognised, for example, that the solution to the issues of privacy rights, hate speech, misinformation and electoral manipulation brought on by big tech companies require not only forceful company stewardship by investors but also global, regulatory solutions.

Separately to the collaborative initiative, as part of our broader human rights programme, the PRI will promote mandatory human rights due diligence legislation, robust accountability mechanisms and financial regulation which recognises human rights as an area of responsibility through local PRI policy representatives.

Within the collaborative initiative, a separate, voluntary working group on investor engagement on public policy will be considered (from year 2 of the initiative onwards) where issue-specific policy and regulatory intervention is required. This will be subject to decisions in the wider PRI change plan on human rights and will build on input from the Signatory advisory committee, technical advisory group and other stakeholders.

Is there a fee to sign-up to the initiative?

There is no fee to sign-up as an endorser or participant.

Can investors join the initiative at any time?

Investors can sign-up as an endorser at any point. The ability to sign-up as a participant will be dependent on the availability of company engagement group places. Some groups may still have spots available. Where the group is full, investors can join the waiting list.

Can an investor participate in multiple company engagements?

Yes, this is possible, but given the high level of demand, the PRI may not be able to allocate the investor to all the companies the investor expressed an interest in engaging with.

What are the reporting requirements of participants?

Participants are required to provide annual high-level reports back to the PRI Executive on their level of participation and progress of the engagement. Collaborating investors are required to submit a shorter report than lead investors, detailing their level of participation in the initiative.

Note, this is separate and unrelated to the PRI Reporting Framework.

Who leads the engagement with each company?

Engagement with companies is carried out by participating investors, with the Lead investor(s) responsible for setting a company-specific strategy for engagement based on the overarching objectives of Advance. The PRI does not itself engage directly with companies although will often join meetings as an observer.