Human Rights in sovereign debt: the role of investors

Year published
2021
Theme
Social
Author
UN PRI
Category
Other

A decade has passed since the adoption of the Ruggie Principles, the UN-sponsored effort to put human rights onto the boardroom agenda after decades of globalisation. The UN Guiding Principles on Business and Human Rights (UNGPs), as they are formally known, have helped clarify the links between business and human rights but they did not explicitly address the role of investors, including those who fund sovereign debt. Yet sovereign nations are the ultimate guarantors of human rights, making the bonds they issue a logical focus for responsible investors. Investors in sovereign debt face unique challenges when considering human rights. Like all fixed income investors, they do not own a stake in issuers, making engagement more challenging than for equity investors. Additionally, pressing a state on human rights violations can raise political sensitivities around issues of sovereignty.