2019 UN Forum on Business and Human Rights

Session organized by the Council of Ethics and the Danish Institute for Human Rights

Webcast of the session:
Meeting link
Meeting number: 849 690 119
Password: KnJcBxkx

This panel aims to generate a dialogue around current experiences with avoiding and addressing human rights risks by government funds such as sovereign wealth funds (SWFs) and public pension funds. This session will look at how two Councils on Ethics of government investment funds have addressed human rights risks and engaged with the UNGPs in their work. Key topics of discussion include: screening, information and prioritization challenges; the strategic use of the UNGPs in driving change among companies; leverage in investment relationships: active ownership vs. exclusion; transparency and reporting. Insight into operational challenges and opportunities faced by SWFs and public pension funds will enable a concluding discussion about policy and regulatory tools that can enable public asset owners and managers to scale up respect for human rights.


Session objectives:

• Uncover reflections from two Councils on Ethics of government investment funds on challenges and opportunities in identifying, managing and accounting for human rights risks in their investments portfolios;
• Identify knowledge, capacity building and policy gaps that need to be addressed to unleash the potential of adequate human rights due diligence by government investment funds.

Key discussion questions:

• What are the current trends and practices in respect to the integration of human rights in government investment funds?
• What information, capacity and policy measures would enable a stronger implementation and dissemination of the UNGPs by government investment funds?
• What are the opportunities for collaborative action and leverage by government investment funds to align the conduct of business enterprises with the UNGPs?

Format of the session:

The format of this session will be a Q&A panel discussion, including questions from both the moderator and the audience.
The panel will take place as follows:

• Presentation by two Councils on Ethics advising government investment funds, the Swedish Council on Ethics and the Council of Ethics for the Government Pension Fund Global (GPFG)
• Comments and reflection by select representative of civil society, academia or UN

Background to the discussion:
This session is based on the fact that Government investment funds such as sovereign wealth funds (SWFs) and public pension funds inject a significant amount of capital in the global economy and have a tremendous potential to positively influence corporate conduct. They also operate in a dynamic policy environment. There is a growing expectation that financial market participants integrate ESG factors in their business models. Most recently this has been emphasized by the adoption of the EU Sustainable Finance Regulation. The body of information and guidance on how investors should align internal procedures with the standard of due diligence outlined in the UNGPs also continues to grow (see for example the OECD Guidance on responsible business conduct for Institutional Investors).
There has however been limited policy and guidance so far clarifying the application of the UNGPs to government investment funds. For example, the UN Working Group on Business and Human Rights report on state-owned enterprises (SOE) recognized that SWFs are a specialized SOEs but excluded them from the scope of their analysis.