Business and Human Rights - Socially Responsible Investing

What is Socially Responsible Investing?

Human Rights & Corporate Responsibility Start Taking Responsibility Doing Right Learning More Socially Responsible Investing News & Reports Actions

Socially Responsible Investing (SRI) is when social, environmental or ethical considerations are taken into account in the selection of an investment. SRI integrates personal values and societal concerns (such as social, ethical and environmental values, many of which give rise to binding legal obligations) with investment decisions. SRI considers both the investor's financial needs and an investment's impact on society.

Social investors include individuals and institutions such as corporations, universities, hospitals, unions, foundations, insurance companies, pension funds, nonprofit organizations, churches and synagogues.

What do investments and pension funds have to do with human rights?

In today's globalized world, pension fund and mutual fund investments affect developed and developing countries in several ways. They may be invested directly in `emerging markets' by buying bonds and shares locally in places such as Singapore or Caracas. Alternatively, they may hold shares in major Canadian, American, or European firms that are active in various countries, either in marketing their own products or in owning mines or factories and/or sourcing their goods (e.g. clothing, shoes, toys or electronics).

In all of these situations, such investment can impact both positively and negatively on the human rights of people and the stability and prosperity of communities. If a company, whether local or foreign, is socially responsible, investment can contribute to the promotion of human rights, the creation of good jobs, and poverty reduction.

If a company is not socially responsible, it can become implicated in abuses of labour and other human right violations or fan the flames of corruption or civil conflict and erode the fabric of a society.

Can small investors make a difference in human rights?

Shareholders provide the capital on which companies depend. Small investors who belong to pension plans or who purchase mutual funds for their RRSPs are therefore the indirect owners of these companies and, as such, have every right to see that their investments are not used to sustain violations of human rights. By pressuring your mutual fund managers or your pension plan trustee to oblige companies to respect human rights, you can make a difference.

Shareholder activism, such as the introduction of resolutions at companies' Annual General Meetings, can be a powerful tool for protecting human rights. By law, shareholder resolutions are binding only if they gain 50% plus one of the votes. In practice, however, if even a small minority of shareholders votes in favour of a resolution, companies will often change their behaviour in order to avoid public controversy.

Exercising our power as investors: What can you do?

Review your own investments
Why not check on whether your investments are socially responsible? Are the companies screened? Are your pension plans screened? What is the profile of the companies in which you hold shares?

Check the investments held by others in your family - by your parents, your spouse, or your siblings. Help those around you become involved in SRI.

Even if you are not personally involved in a pension plan, people you know are. Ask your friends and co-workers to check their plans. Talk to teachers and ask them to check their plans.

Ask questions
You are entitled to write and ask questions of your fund managers. We have included two sample letters in the booklet to generate ideas and get you started. We invite you to include one of the Amnesty International pamphlets on Business and Human Rights (see the Resource list in the booklet or click here) with your letter.

Apply pressure
We all need to do more to pressure governments to amend pension legislation. We have included two sample letters in the booklet: one for your provincial government and one for the federal government.

Stay connected
Check out the Amnesty website www.amnesty.ca for updated actions that you and your family and friends can get involved with, not only in the area of Business and Human Rights, but to support all matter of human rights.

Download the full booklet (PDF)

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