Companies are expected to operate within international norms and conventions related to human rights, labor, environmental stewardship and business ethics. When companies don’t adhere to these standards, incidents may occur that result in reputational damage and shareholder value destruction.
Sustainalytics’ Business Conduct Engagement is an incident driven engagement service that offers investors a collaborative tool for active ownership with rich information for investment decision-making and reporting. On behalf of our clients, we engage with companies that severely and systematically violate international standards, such as the United Nation's Global Compact and the OECD Guidelines for Multinationals. Our objective is not only to resolve the incident, but also to improve the company's future ESG performance and risk management in order to ensure incidents don't occur again in the future.
More than 20,000 companies from major world indices are currently monitored for incidents on an ongoing basis and this universe can be expanded with additional companies on client request.
Key Features and Benefits
Demonstrate your commitment as a responsible owner
Responsible investing goes beyond stock selection. Today, institutional investors are expected to take steps to being active and engaged shareholders that view corporate accountability as a path to achieving greater long-term value.
Manage reputational risks
Let us help you manage reputational risks by applying a compliance-focused approach to engaging with companies that are non-complaint with international norms.
Collaborate and pool resources
Determine your level of involvement, for example, by taking an active part in engagement dialogues, conference calls and teaming up with other investors.
Track progress with live, fully-transparent updates
Access the latest updates on our fully-transparent web-based platform where you can find the most recent updates, like email correspondence, meeting minutes and more.
Access a global universe of companies
We cover more than 20,000+ companies across the world with 380+ engagement cases on 280 companies in 2018.
How does Business Conduct Engagement Work?
1. Systematic monitoring of companies for incidents
We monitor more than 20,000 media sources on a daily basis to identify potential incidents involving a universe of over 20,000 companies across the globe.
20,000+ media sources
Global Compact &
2. Research and assessment
Once an incident has been flagged, our global research teams starts gathering facts and assesses the case against a set of international conventions and guidelines for the environment, human rights and business ethics. International standards include the United Nation's Global Compact, the OECD Guidelines for Multinationals, UN Guiding Principles, human rights conventions, labor rights conventions, environmental conventions and weapons-related conventions.
3. Engagement dialogue: Incident and risk analysis
Sustainalytics consistently engages with ALL companies alleged of violating international norms to establish what actually occurred. Findings from the initial meetings are summarized in an incident analysis report followed by a risk analysis, which assesses the company's operational and company-specific risks.
Incident & risk analysis
4. Company report and action plan
A clear action plan with measurable outcomes and milestones are drawn up to achieve the desired outcomes. A follow-up dialogue is arranged to further investigate the case, which is presented along with a full company profile in the online platform.
5. Reporting and case closure
Sustainalytics measures engagement by both the company's response and progress. Rigorous criteria are employed to assess whether to close and archive a case.