This report provides a tool to assess technology company business models’ human rights risks, primarily for institutional investor engagement. Technology company business models are increasingly coming under scrutiny for allegedly creating or exacerbating negative impacts on human rights, ranging from algorithm-supported decision making to low-leverage sales practices.

Background and context

The UN Guiding Principles on Business and Human Rights (UNGPs) are the leading global standard to prevent and address human rights harms, including business model-driven practices and technology design that create or exacerbate impacts on human rights.

The role of investors

Institutional investors have a unique influence over technology companies’ governance and decision-making, and this influence encompasses companies’ efforts to embed respect for human rights into their operations, products, and services. This tool aims to equip investors to assess companies’ progress in discharging that responsibility.

Engagement cards

This tool provides a series of “engagement cards” for investors to use in modeling their engagement with technology companies. Each card is a stand-alone guide to address a discrete issue connected to business model-related human rights risks, including algorithm-supported decision making, high-risk customers or end-users, conflict-affected and high-risk areas, and low-leverage sales practices. The tool includes an evaluation framework to support investors in assessing the quality of company responses received to those questions.

Engagement on business model governance

Regular engagement by boards and executives with business model-related human rights risks suggests that leadership views these risks as relevant to the fiduciary duty of board members to the company and shareholders. This tool provides an engagement card to inform investors’ engagement with the company’s board and executives regarding whether company leadership actively reviews and engages as necessary with the company’s business model-related human rights risks broadly.

Algorithm-supported decision making

Where a company’s commercial success depends, in part or in full, on the development and/or use of machine learning algorithms to make decisions that may materially impact human rights, this card can be used to address the specific risks of algorithm-supported decision making.

High-risk customers or end-users

This card is intended to support investors who engage technology companies on risks associated with high-risk customers or end-users with whom the company, as a matter of standard practice or law, has limited leverage.

Conflict-affected and high-risk areas

Investors can encourage companies to develop appropriate operational procedures to mitigate and manage risks in conflict-affected and high-risk areas by using the conflict-affected and high-risk areas engagement card.

Low-leverage sales practices

Companies in the technology sector have come under scrutiny for their sales practices, particularly where they involve low-leverage techniques. Investors can ask companies about their use of such techniques and how they mitigate the associated risks of harm to human rights by using the low-leverage sales practices engagement card.

Recommendations

Investors can use this tool to assess the progress made by technology companies in discharging their responsibility to respect human rights under the UNGPs. The tool supplies investors with questions to inform their engagement with boards and executives and embeds an evaluation framework to support investors in assessing the quality of company responses received to those questions. The report recommends that institutional investors use this tool to aid their engagement with technology companies to foster progress towards the responsible and respectful integration of human rights considerations in technology company business models.