B-Tech briefing | Rights-respecting investment in technology companies
Recent advancements in digital technologies present opportunities for economic growth and the realization of the Sustainable Development Goals (SDGs). However, such innovation can also undermine fundamental rights, including through widespread infringements on privacy, ‘algorithmic discrimination’—affecting people in the job market, in the criminal justice system or when accessing public services—as well as enabling the dissemination of hate speech and online violence and undermining democratic processes.
Institutional investors, both asset owners and managers, have unique and systematic influence over how companies in the technology industry are governed, make decisions, and act. This extends to whether or not these companies embed respect for human rights into their operations, products, and services.
In light of this, a key lever to encourage businesses to respect human rights is to activate investors to operate responsibly. In this regard, the UN Guiding Principles on Business and Human Rights (UNGPs) are an important tool. They set the expectation that investors at every stage of a company’s lifecycle—from start-up to maturity—have a responsibility to ensure that their investments in the technology sector avoid negative impacts.
Unanimously endorsed by the UN Human Rights Council in 2011, the UNGPs are the authoritative global framework outlining the roles and responsibilities of state actors and business enterprises—including investors—when it comes to the impacts of business on human rights. They rest on three pillars: the state duty to protect human rights; the business responsibility to respect human rights in their own operations and throughout the value chain; and the right to access remedy for victims of harm.
This briefing provides institutional investors with holdings in digital technology companies with high-level analysis and guidance on how to apply the UNGPs framework to these investments. It clarifies the human rights responsibilities of investors, identifies trends in current investor practice and suggests resources for investors.