Since 2000, Good Jobs First’s Violation Tracker has recorded over 116,000 employment related offences with a total payout of over $31billion in the US alone. In this article we explore what ‘Decent Work’ means and what we at Rathbone Greenbank Investments, as well as other investors, can do to promote and safeguard high standards.
Decent working standards: why we need them and how we can promote them
At its core, ‘decent work’ means having an appropriate power balance between employer and employee. The International Labour Organisation (ILO) defines decent work as “productive work for women and men in conditions of freedom, equality, security and human dignity.” In other words, employment opportunities where the employee is not being exploited or manipulated for their labour, and instead receives a fair income and safe working conditions, as well as being treated with dignity and equality.
Decent work makes up one of Rathbone Greenbank Investments’ sustainable development themes and is also an integral part of our work on the just transition. Decent Work is an important contributor to equality of opportunity and is an essential check to ensure that no one is left behind as we transition to a low carbon economy.
What is decent work?
The ILO sets out four key elements of decent work: job creation, including opportunity for development; rights at work, for example minimum wage; social protection; and social dialogue.
In 2015 these elements were integrated into the UN’s Agenda for Sustainable Development under goal 8, which aims to “promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all.” The aim of the Sustainable Development Goals is to end global poverty and improve health and education, whilst reducing inequality and tackling climate change. Decent work for all has a crucial role to play in this.
Good Jobs First maintains a Violation Tracker of infringements on decent working standards. From issues around wages and hours to labour rights violations or restrictions on freedom of representation, these are all instances of the right to decent work not being upheld by employers, and these are only the violations that make it to formal proceedings. Many more go unreported. Around the world workers rights continue to be transgressed at staggering levels, making the abuse of decent working standards not just a humanitarian crisis, but also an investor one.
Minimising employment related offences through ensuring decent work opportunities for all is crucial to sustainable development around the world. Decent working conditions and quality employment empower people - particularly women, and vulnerable demographics - as well as helping to reduce poverty and inequalities worldwide.
What are we doing to advocate for decent work?
Everyone has a role to play in ensuring the right to decent work for employees. Greenbank is supporting this through being a long-standing partner of the Workforce Disclosure Initiative (WDI). Engaging with the WDI is an important tool through which investors can safeguard the principle of decent work. The WDI aims to improve public reporting and transparency from companies on workforce related issues, helping investors identify leaders and engage with companies to improve outcomes for workers.
We engage actively with this initiative, including encouraging companies that we invest in to participate in the WDI, which sends a strong signal of valuing workers and a willingness to be transparent with shareholders. We were also involved in the WDI pre-launch helping to shape its methodology and remain an active participant in its periodic reviews.
Supporting a living wage
Another focus area for Greenbank’s engagement on Decent Work is in the field of living wages and secure working conditions. In addition to encouraging companies to become accredited Living Wage employers, we also support the Living Wage Foundation and ShareAction’s Good Work coalition to encourage companies to join the Living Hours accreditation scheme. This dovetails with the concept of a living wage and enables employers to commit to providing their workers with added security and stability of working hours and shift patterns. This includes providing the right to decent notice periods for shifts and the right to a contract that reflects accurate hours worked, among other measures.
The Violation Tracker mentioned above is an excellent resource when researching companies, detailing 20 years of corporate crimes and misconduct in America. Good Jobs First, in cooperation with the Transparency Task Force, are rolling out a Violation Tracker in the UK. This has created a free directory with access to information on over 63,000 cases brought by over 40 regulatory bodies.
The power that such a tracker brings is through shining a light on the indiscretions of companies and making it easier to detect patterns in behaviour. This is helpful to regulators in prosecuting and legislating against infringements. And it is also helpful to us as investors as it allows us to better scrutinise potential investments and see where we can undertake more targeted engagement work.
How can investors promote decent working standards?
Together, we can work to ensure that employees everywhere have decent work. For investors that are committed to promoting decent working standards, the most important step is to engage with the companies in which you invest. This includes encouraging them to disclose how they are identifying and managing workforce risks, how they are attracting and retaining the best talent, and how they are ensuring their workers are safe and fairly remunerated.
This is best done through participating in the WDI, where you can work collaboratively with us and other parties to promote disclosure, identify patterns and undertake more impactful targeted engagement work.