BMO Global Asset Management has been a signatory of the WDI since its inception around three years ago. We reinforced our commitment at the beginning of 2019, becoming a member of WDI’s Advocate Group. This group assembles a set of 20 investors that collaboratively engage a subset of companies for enhanced disclosure.
In 2019, BMO Global Asset Management’s Responsible Investment team reached out to 77 companies to encourage them to respond to the WDI, often in the context of wider engagement on other labour-related issues such as diversity and living wages. In some cases, this led to a dialogue on the reasons for our WDI support, as well as feedback from companies on the challenges they face in responding.
Among those challenges were:
- a lack of data, meaning a company could only make a partial completion;
- fear of being retaliated against for partial disclosure with a public low score;
- an overall lack of resources, particularly given the length of the survey; and
- other reports being higher on their priority list.
The challenges are real, though their weighting in deciding for or against a WDI submission needs to be evaluated.
While WDI scorecards show a percentage relating to the share of disclosed information, these scorecards are not made public. Our own interest in the scores is limited, and we would welcome even partial disclosure for our assessments.
Limited resources are of course an all-time challenge. As the survey builds on existing reporting standards, with the ‘social’ element of sustainability gaining more traction and with the level of investor support the WDI experiences, companies should consider re-prioritizing. In addition, in 2019 the WDI has also offered participating companies to pre-populate its survey based on publicly available data.
Of the 77 companies we engaged, 10 had replied to the WDI survey in 2018. In 2019, of the companies we reached out to, 17 have submitted their responses to the WDI.
The 2019 evaluation of the quality of responses is ongoing and will be published by the WDI in the first quarter of 2020.