PLSA ESG 22: Environmental issues must not overshadow social factors

Focus on environmental issues in pensions should not completely overshadow the social issues within workforces, according to A Blueprint for Better Business CEO, Charles Wookey.

Speaking at the PLSA ESG Conference 2022, Wookey made the case that, whilst it is important to make sure that the industry deals with environmental issues, dealing with social problems should not be overlooked.

Wookey commented: “Rising inequality is no more a stable equilibrium than rising temperature and I do think there is a real risk of, as companies go on the environmentally led transition, we end up with a number of very, very acute social problems.”

Offering his thoughts on what could be done to make sure that social problems do not get lost in the shuffle, Wookey added: “I think there are some things that investors can and should hold them to account to be doing at this point as they go on with these transitions, and one is this core thinking of what they exist to do in world in terms of the workforce and the social aspect of that, so the emphasis on fairness, the wages that they pay, the discourse and the level of dialogue as they go on this transition.”

He also described why the danger of social issues was being forgotten, pointing to the disparity in available information between the two issues: “The quality around the ‘S’, certainly at portfolio level, is 10 years behind where we are with the ‘E’, we just don’t know what the social implications of what a lot of these companies do are.”

TUC president Sue Ferns offered a word of caution concerning groups being left behind, including workers on zero-hour contracts: “It’s very difficult for them sometimes to enforce their basic human rights,” she stated.

Although she levelled praise for progressive investors, Ferns also pointed to certain areas that could use improvement to assist zero-hour workers, adding: “I think absolutely the progressive investor community needs to keep doing what it’s doing and do it perhaps quicker if it can do.”

“I do think for that other group in the corporate world we do need legislation or high-level frameworks really to create the environment and to create the impetus for that to happen.”

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