A coalition of investor groups — including Canada’s NEI Investments and the Shareholder Association for Research & Education (SHARE) — is calling on global banks to enhance their policies for respecting the rights of Indigenous peoples.
The group, which includes 50 organizations representing over US$2.9 trillion in assets under management, said that the Equator Principles (EPs) — a voluntary, global environmental and social risk management framework — doesn’t provide an adequate mechanism for avoiding reputational, financial and litigation risks involving Indigenous rights when banks finance controversial projects, such as pipelines.
“Corporate projects can experience costly delays and disruptions when proper consultations with Indigenous communities have not been undertaken, and their valid consent has not been obtained,” the group noted.
In their statement, issued on Wednesday, the investors called for the “Equator Principles to be strengthened” to better recognize Indigenous rights.
The initiative, which is being led by Boston Common Asset Management, includes Toronto-based asset manager NEI and Vancouver’s SHARE; U.S. organizations such as CalPERS, the New York State Comptroller and the Comptroller of the City of New York; and investor organizations representing Indigenous populations, such as the National Aboriginal Trust Officers Association of Canada.
“The EPs should ideally provide assurance to investors that a bank’s financing deals aren’t going to blow up in their faces due to avoidable ESG-related risks,” Jamie Bonham, manager, corporate engagements at NEI Investments, said in a statement.
“It is imperative for the association to get this iteration of the principles right to avoid losing its relevance as a risk framework,” Bonham added.