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EIRIS Foundation

Service Providers Framework 2019

You are in Research and Data Provision » Research/process level

Research/process level

RDP 02. Sources for research and/or rating

02.1. Indicate the types of sources you use for research and/or ratings of companies/sectors/geographies or similar. Tick all that apply.

02.2. Indicate how ESG factors are incorporated into your research and/or rating methodology

02.3. Describe how you define materiality and how this is captured in your research and/or rating methodology as well as final product.

          For our research for the Corporate Human Rights Benchmark materiality is defined at several levels: (1) The companies assessed (extractives, apparel and agriculture/food companies) have been chosen as belonging to sectors particularly affected by human rights challenges; (2) within the benchmark each sector is assessed according to criteria that reflect the materiality of that issue to the sector. It is worth saying that business and human rights work generally focuses on "salience" (=the risk to the rights holder, rather than what may impact the company) but in many cases this focus identifies issues that are indeed material to the company as well, or else have an increasing likelihood of becoming so through impacts on human capital, legal developments, access to resources, industrial accidents or the effects of the company's general reputation upon its business. The data is presented indicator by indicator as well, so an investor could take their own view of the materiality of each element of the assessment. 

In the case of our Investment in Occupied Lands project operations in Crimea or Palestine is taken as the materiality threshold for inclusion in the database. 

In our database for UK retail investors materiality is defined by the user of the website by selecting the factors they are concerned about.

02.4. Additional information. [OPTIONAL]

RDP 03. Stakeholder input

03.1. Describe how you actively include input and information, wherever possible, from relevant stakeholders or interested parties, in the research process or in reaching assessment conclusions.

          We have used various sources of information, from individual stakeholder feedback to more formal roundtables for example to provide input into our Investment in Occupied Lands project and related report around due diligence for businesses operating in occupied territories. 

The Corporate Human Rights Benchmark was created by the project partners with extensive input from stakeholder consultation (companies, trade associations, civil society and human rights NGOs), with over 400 individual or organisations providing comments, sometimes in considerable detail, on the draft methodology, individual indicators, the weighting on them in the overall assessment and a range of other matters which had a material impact on the final shape and content of the methodology.

03.2. Additional information. [OPTIONAL]

RDP 04. Up-to-date assessment and ratings

04.1. Indicate how you ensure that your ESG assessment of companies/ sectors/ geographies or similar is up-to-date and that new information is incorporated or new assessments are conducted at reasonable intervals.

04.2. Additional information. [OPTIONAL]

The Corporate Human Rights Benchmark has now moved towards an annual cycle (though with 18 months between the pilot and the next benchmark) with opportunities for companies to review and provide more detail in each cycle. There is a portal to allow companies to publish fresh information in time for the project deadlines, and this year we have made available a spreadsheet aligned to the benchmark indicators simplifying the process of companies publishing relevant data if they wish to do so.

The Investment in Occupied Lands project has been been updated three times in three years by summer 2018, and can make changes to the database at any time in the light of new information arising from the monitoring referred to.

The updating cycle for and the charity product sections of are under review at present, some sections have been updated and moving forward more regular updates will be taking place. 

RDP 05. Balanced research and assessment

05.1. Indicate how you typically ensure a balanced approach to your research methodology and assessing/rating of companies/sectors/geographies or similar. Tick all that apply and explain your approach to each option.

Type of indicators

Explain your approach

          The Corporate Human Rights Benchmark analyses or makes use of a number of quantitative indicators (for example trends in performance amongst the company's supply chain, health and safety data, statistics on the use of grievance mechanisms or audit processes and progress in implementing living wage policies) but it focuses more on the assessment of qualitative data on policies and practices such as how a company has engaged with customary owners when purchasing land)

Our website focuses mainly on helping retail investor to identify the products or institutions that meet their particular requirements and so this tends to be based upon the assessment of qualitative data.

The Investment in Occupied Lands project is focused on identifying companies with operations in Crimea or Palestine.

Explain your approach

          The Corporate Human Rights Benchmark allocate 60% of its score to policies and processes (including the operation grievance mechanisms) and 40% to performance as measured by detailed practices (for example taking identity documents off workers or the implementation of living wage policies) and by assessing how the company has responded to serious allegations from stakeholders about the human rights performance.

The Investment in Occupied Lands database presently assesses only whether companies are present in Crimea or Palestine, but is considering extending to provide information about due diligence processes that have been undertaken by the companies concerned which would include a mixture of management/process indicators and potentially disclosing information about performance.

Our website is focused largely on assessing the policies and processes followed by each of the retail products examined, but funds may also disclose information about their ESG performance, for example their engagement activities.

Explain your approach

          The Corporate Human Rights Benchmark does compare performance in the pilot benchmark in 2017 with that achieved in 2018. The complication here is that the scoring system has changed in some respects and there have been other improvements in the methodology between the two exercises.

Our website and the Investment in Occupied Lands database both focus on our understanding of the current situation.

Explain your approach

          Our website covers the full range of ESG criteria, whereas the corporate human rights benchmark focusing only on human rights (although it does include the governance of human rights and some environmental criteria such as water or environmental damage affecting local livelihoods), while the Investment in Occupied Lands database only focuses on operations in Crimea and Palestine.

Explain your approach

          Our website is based largely on data reported to us by the retail fund provider or financial institution, but it does also include data we've been able to find on public websites.

The Investment in Occupied Lands databases is heavily based on third party data although also on data drawn from companies' public documents such as annual reports. Companies are given the opportunity to review and add to or updates the information we have obtained.

The Corporate Human Rights Benchmark is based upon information both from companies and from stakeholders in the form of allegations of poor human rights performance, but all information has to be made public in order to be assessed. The project provides a specific portal to allow companies to make public new information before the research and also after the engagement phase if they wish it to form part of their assessment, in order to comply with the public information rule. This year we have introduced a special Excel tool to make it easier for companies to publish information against each of the indicators if they wish to do so.

05.2. Additional information. [OPTIONAL]

RDP 06. Consistency and comparability

06.1. Describe the control processes in place to ensure quality of research.

          All our projects involve providing the companies or the funds involved with sight of the research before publication with the opportunity to alert us to errors and to propose any corrections and amendments they would like us to consider. Tricky cases and judgements are referred to colleagues or escalated as necessary. There are public methodology documents which aim to be clear and unambiguous and more detailed written methodology handbooks for researchers that document decisions and finer points and are updated as new research questions emerge. 

In the pilot Corporate Human Rights Benchmark each company was researched by a different researcher before and after the engagement phase of the project and a sample of the assessments were reviewed by external researchers or experts. During the process individual researchers could also raise issues for clarification at regular team meetings held for that purpose and specific points were escalated to the methodology committee as necessary. There was a review of the highest scores for all companies indicator by indicator to ensure consistency across companies and sectors before publication as well. 

The 2018 Benchmark incorporated a review of each assessment by a second more senior researcher and the database was enhanced to facilitate consistency, ensure coverage of all key documents published by the company and make available advice and FAQs to the analysts. The same engagement process we used in 2017 was followed, but the new excel tool for companies to submit new data makes it easier for companies to clarify the points they wish to make public or to point us to specific material they feel may have been overlooked.

06.2. Additional information. [OPTIONAL]

RDP 07. Emerging ESG issues and trends

07.1. Indicate whether you identify and prioritise ESG issues and emerging trends.

07.2. Describe how you incorporate the identified ESG issues and trends in your product offerings and business activities.

          The Corporate Human Rights Benchmark was designed to put more focus on a series of emerging issues in the field of business and human rights (which is itself an overall emerging issue as people look for "more S in ESG"). Examples we included following stakeholder consultation included respecting and protecting the rights of human rights defenders in particular, public commitments to remedy in the case of adverse human rights impacts, implementing living wages policies across supply chains and publishing details of your suppliers globally. Such best practices are given the highest scores within the benchmark framework so that those companies with the highest scores needs to be addressing most or at least a good number of these to continue to score well. 

The idea of investors using the due diligence process for the UN Guiding Principles on Business and Human Rights as an "ask" for companies investing in Crimea or Palestine seemed to work with investors in the roundtables we held in the autumn of 2017. We will be incorporating that in the project by working with individual investors to pursue this idea, and also potentially adding to the database details of any due diligence assessments that companies publish as a result. 

We are looking at adding "impact investment" opportunities for retail investors to as a specific emerging trend in this area. 

The Foundation is starting work on two other strategies that focus on trends that we feel would be of general benefit to responsible investors if they emerged in the coming years: the first is "transformational engagement" by investors, by which we mean engagement strategies designed to facilitate meaningful change to the global economy (or parts of it) so that successful economic activity can be sustainable in the long term; and the second is to understand and promote the spread of best practice corporate responsibility which is too often practiced only by a handful of leaders, when the portfolio benefits depend upon much wider uptake.

07.3. Additional information

RDP 08. Client use of outputs

08.1. Describe how research and data provision outputs are used by clients.

Describe how research and data provision outputs are used by clients.

Retail investors are able to use to help them understand and choose between the different responsible investment strategies available in the UK retail marketplace.

In April 2018 The Corporate Human Rights Benchmark published a progress report which includes an assessment of the impact of the project to date ( and this provided a platform for investors to congratulate the leaders and challenge the laggards as well as making use of the overall rankings and the detailed assessments in their individual approaches to responsible investment.

Investors have used the Investment in Occupied Lands database to assess their risk exposure of their portfolio and the report we produced: Questions to help companies respect human rights in occupied territories is a useful tool for investors to understand the risks and potential human rights implications of investing in companies which operate in occupied territories. 

08.2. Additional information. [OPTIONAL]

RDP 09.