How can investors and asset managers advance the fulfilment of children’s rights? This is what Evli is exploring in a project led by UNICEF Finland. The aim is to increase companies’ understanding of child rights and their ability to integrate child rights into business operations. The project also seeks to map the attitudes and concrete actions of companies and investors on child rights.
For several years now, Evli has been using UNICEF Finland's expertise to broaden its experts' understanding of children's rights. The aim of the newly started project is to map out how child rights are implemented in business activities and how investors can integrate them in investment decisions. Evli tackles the investor angle, specifically how Finnish companies report on child rights to investors and how investors can integrate child rights into investment decisions.
“We want to find out how children's rights can be promoted in concrete terms, not only in our own investment activities but also more widely. In the future, it will be possible to scale up the research with the help of an external research body, which could have a very significant impact”, says Petra Hakamo, Evli's Head of Sustainability.
As part of the study, Evli is interviewing representatives of Finnish companies to learn how they incorporate and disclose on children's rights, and how they ensure that the rights are enforced in their operations. Finnish companies operate globally, so the decisions they make also have an impact beyond Finland's borders.
“A child rights lens provides companies with additional information on a variety of sustainability topics and can also offer deeper insight on potential risks. Guidance and indicators on child rights and business already exist, but we want to understand how investors can concretely utilize these in their own work”, says Outi Kauppinen, UNICEF Finland's Senior Advisor, Sustainable Development.
Children's rights are more than just preventing child labour
At Evli, we believe that investors and asset managers have the power to influence the way companies regard child rights. While sustainability programmes often consider human rights, child rights are not specifically addressed. For companies, the concept of child rights often equates to child labour. However, companies also affect children through the working conditions of caregivers, the design and marketing of products and services, and action on climate change.
“Children are currently not receiving enough attention in human rights assessments. Children need special attention because they are still developing and have very limited influence over their own affairs. It is also the responsibility of companies to build a good and equitable world for them”, says Hakamo.
“The Covid-19 pandemic, the war in Ukraine and the climate crisis have caused serious harm to children’s lives. It is now especially important for companies to act on behalf of children”, Hakamo adds.
EU calls for more reporting on social impacts
Children's rights are also particularly relevant because the European Green Deal is introducing several reporting requirements related to companies and their social impact. For example, social responsibility will be given more specific targets through the EU’s social taxonomy, which in practice means a set of criteria for the types of business activities that can be defined as having a positive impact on society. In addition, companies will have to report on how human rights are implemented in their value chain.
“Children are currently not receiving enough attention in human rights assessments. Children need special attention because they are still developing and have very limited influence over their own affairs. It is also the responsibility of companies to build a fair and just world for them”, says Hakamo.
“The classification of business activities also has a direct impact on investors, as they get a better idea of which ones are considered sustainable. The aim is to direct money flows more broadly to socially critical activities, such as education and healthcare”, says Hakamo.
“Because of their impact and resources, companies have a huge role in shaping our world. Business supply chains affect the lives of up to a billion children. Investors, on the other hand, play a crucial role in shaping the practices of the companies in which they invest. Taking child rights into account most likely means more responsible business activities now, but at the same time it builds a safe path for today's children to become the future customers and authors of the next chapter of our planet”, notes Kauppinen.
Data limitations challenge responsible investors
UNICEF’s Tool for Investors on Integrating Children's Rights into ESG Assessments provides investors with guidance on assessing their portfolios from the perspective of children’s rights. The tool explains the impact that companies can have on children’s rights and how to identify risks to children's rights in business activities. Evli has been involved in providing feedback on the tool from its development stage.
“The aim is to take children's rights into account even better. We mirror our own actions as an asset manager to the Tool for Investors and use it to see if and where we can improve”, says Hakamo.
Although Evli has already been analysing the sustainability of target companies for a long time, limited data and reporting remain a challenge in assessing certain sustainability issues. The research work of Evli and UNICEF Finland seeks to address this.
“When making investment decisions, we assess and monitor a broad range of corporate responsibility factors, including child rights. The challenge at the moment is that there is very limited reporting on them. We believe that through extensive dialogue, issues and reporting on children's rights can be developed to provide more concrete information for investors”, says Anna-Liisa Rissanen, Portfolio Manager at Evli.
The UN Convention on the Rights of the Child is a comprehensive and detailed human rights treaty. At its core are the prohibition of discrimination against children, the right to freedom of thought, conscience and religion, and the right to growth, development, and education. It obliges States Parties to promote the realisation of the rights of the child and to protect children from violations of these rights. The Convention was adopted in 1989 and entered into force in Finland in 1991. It is the most widely ratified human rights treaty in the world, only the United States has not signed it. World Children’s Day is celebrated on November 20th.
For more information:
Petra Hakamo
Head of Sustainability and Responsibility, Evli
Tel: +358 40 552 5880, petra.hakamo@evli.com
Outi Kauppinen
Senior Advisor, Sustainable Development, UNICEF Finland
Tel: +358 40 820 4141, outi.kauppinen@unicef.fi
