AP Funds’ Council on Ethics -led collaboration to engage tech giants

Digital services are increasingly prominent in our everyday lives and tech companies have a significant potential for societal impact. Many online platforms have business models which centre on maximising interactions with their content and serving users with information they are interested in. This has great benefits for transparency and connectivity, but also comes with notable risks. For example, the spreading of malicious or untrue content can cause far-reaching damage. Apart from jeopardising individual human rights, especially those of vulnerable groups, hate speech and misinformation can have system-level consequences such as hyper-polarisation, discrimination, violence and erosion of democracy. A failure to manage these impacts can harm the companies’ social license to operate and the associated reputational, legal and regulatory risks may have material implications.

The Council on Ethics of the Swedish national pension funds has organised a group of institutional investors with EUR 6.4 trillion in combined assets under management to collaboratively engage with focus companies Alibaba, Alphabet, Amazon, Apple, Meta, Microsoft and Tencent. The three-year initiative aligns with the UN Guiding Principles for Business and Human Rights and builds on the investor expectations issued by the Council on Ethics and the Danish Institute of Human Rights in 2020. The primary goal is to ensure that the tech giants take concrete measures to address operational and human rights risks pertaining to their products and business model, and to encourage a more transparent reporting on the related impacts and efforts. The collaboration’s activities and results will be publicly reported.

Magdalena Håkansson, Chair of the Council on Ethics, comments:

“I am proud of how the Council on Ethics has been a driving force behind this initiative. We, together with this investor group, recognise the systemic nature of the challenges related to online content, and in addition to effecting company-level improvements hope to raise broader discussion and awareness of the risks with the services of these tech companies. The dialogues will focus on content-related practices pertaining to corporate culture and structures, vulnerable groups (especially children), access to remedy and stakeholder engagement. The Council on Ethics looks forward to addressing this highly topical and increasingly pertinent topic together with this impressive group of investors.”

“We are delighted to be part of the collaborative initiative convened by the Council on Ethics. As the regulatory environment continues to evolve and ever more material risks related to the development and use of technology are identified, collective engagement is essential to build expectations and hold tech companies accountable for their societal impact”, said Luda Svystunova, ESG Analyst at Amundi.

“Companies must address any human rights or operational risks associated with their business model and industry to earn the trust of investors seeking long-term value. A failure to do so is irresponsible, flies in the face of sustainable business practices, and has a far-reaching impact on millions of households and ultimately the company’s bottom line. I am grateful to the Council on Ethics and collaborating investors for continuing to raise awareness and demand for greater transparency and disclosure as the footprint for the technology sector grows globally,” added New York City Comptroller Brad Lander.

For more information, contact:
Magdalena Håkansson, Chair, AP Funds’ Council on Ethics, magdalena.hakansson@ap1.se or +46 8 566 20 200.

The participating investors include:
ACTIAM
Amundi
AP1, AP2, AP3, AP4
APG
Aviva Investors
AXA Investment Managers
Boston Common Asset Management
Candriam
CCLA
Church Commissioners for England
Church of England Pensions Board
Christian Brothers Investment Services
Domini Impact Investments, LLC
Ethos Foundation
Ethos Engagement Pool International (104 investors)
LGPS Central
NY City Comptroller’s Office
PGGM
Railpen
Robeco
Royal London Asset Management
Schroders
Swedbank Robur
Swiss Association for Responsible Investments (11 investors)
Universities Superannuation Scheme
Van Lanschot Kempen
Öhman Fonder