What does Roe v. Wade for investors? | blog post
The United States Supreme Court decision to overturn Roe v Wade raised pressing questions about the role of investors and their beneficiary companies in contributing to the political landscape, and how decent work and human rights can be guaranteed for all.
The decision ended the constitutional right to abortion in the United States and will impact other aspects of reproductive rights such as contraception, sexual health and sex education. There are also fears that the decision could set a precedent for other civil and human rights such as same-sex marriage.
The Roe v Wade upset is also expected to impact the United States maternal mortality rate, which are the highest among industrialized economies. Across the country, abortion clinics are closing, hampering access to other essential health services. The closures will likely be felt disproportionately by women, non-binary and transgender people, as well as low-income populations in abortion-banning states, where people will have to travel long distances and incur additional costs to access health services.
Without access to family planning services, the economic conditions of individuals will deteriorate significantly, especially in a country where basic benefits such as family leave, childcare and access to health care are not widely available. .
Material and financial risks for investors
It is important to underline the significant financial risks resulting from this decision for investors. A lack of access to health care and increased inequality can impact financial and system-level stability. Evidence shows that access to health care is directly linked to economic development and can impact productivity.1 At the portfolio level, failure to consider short- and long-term actions to help employees access family planning and childcare options can lead to reduced labor market attachment and income levels, as well as increased employee turnover (estimated cost to economies in abortion-restricting states is $105 billion per year).2
Reproductive rights as human rights
In addition to the financial and material risks, investors have the responsibility to respect human rights, formalized by the UN and the OECD. Where investors have caused, contributed to, or are linked to potential negative impacts, they should engage policymakers and businesses to strengthen and advance human rights legislation and safeguards.
In particular, access to safe abortion is established as a human right by many international frameworks, including the United Nations Human Rights Committee, as well as regional human rights tribunals.3 A commitment to prevent unsafe abortions was also included in the Cairo Declaration on Population and Development signed by 179 governments in 1994.4 The report also points out that the World Health Organization first recognized unsafe abortion as a public health problem in 1967, and in 2003 recommended that states adopt abortion laws. to protect women’s health.
Decent work means access to health care
Access to a safe and healthy work environment is a fundamental right. In June 2022, the International Labor Organization included health and safety in its Fundamental principles and rights at work – a milestone for workers as it means that ILO Member States are committed to respecting and promoting the fundamental right to a safe and healthy working environment.
As our recently published article on Decent Work highlights, access to benefits, health and safety, and social protection are the minimum standards companies should provide to employees and workers in their supply chain. These standards are necessary to generate positive outcomes for workers, in line with Sustainable Development Goal 8 (decent work and economic growth).
Companies can take specific steps to improve employee access to health care. When companies incorporate reproductive health into their broader benefits, there should be a clearly articulated plan for when access to healthcare may be restricted.5 Where relocation is permitted, companies could support employees through temporary relocation to states supportive of reproductive rights. A number of companiesincluding Amazon and Starbucks, have already extended health benefits to cover travel costs for people seeking abortions.
Engage policy makers responsibly
As discussed in our article on investors’ case for responsible policy engagement, investors should pay attention to how their beneficiary companies shape the regulatory landscape in the same way that they consider the impact of these companies on society and the environment through their operations, products and services. . If investors do not take a holistic approach to risk management, recipient companies can weaken social safeguards while proclaiming unwavering support for human rights.
Investors should first identify how ESG management activities can include corporate political engagement, based on international standards such as the ILO Conventions and the UN Guiding Principles on Business and Human Rights. As outlined in our paper on Responsible Policy Engagement, investors should also use stewardship to clarify their expectations of companies, advocate for stronger commitments to meet these frameworks, and mitigate material risks. For example, recent shareholder proposals asked companies such as TJX and Walmart to release a report assessing the risks and costs associated with recent laws restricting reproductive rights.
The question of access to care is vast for investors, companies and employees. Investors should be aware of their potential to protect reproductive rights in their portfolio companies and ensure that political engagement activities reflect international human rights standards.
The PRI resources below may be useful for investors who want to learn more about protecting reproductive rights and ensure that policy engagement activities reflect international human rights standards.
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