Swedish pension fund AP3 has developed a framework for assessing and evaluating the impact of countries and companies on human rights.

AP3 noted that, through its investments, it can influence how companies handle human rights, and it focuses on four areas of sustainability, including human rights.

The first step of its framework process is to assess countries based on parameters including democracy, respect for human rights, freedom of expression, principles of the rule of law, the judiciary and corruption.

AP3 noted that a country’s governance has implications for the overall risk assessment, as investments in countries with poor governance have a higher risk of developing in an unsustainable direction.

Its second step is an ongoing screening of the fund’s portfolio to identify which companies are aware of the risks linked to human rights that their operations are exposed to, and pursue work with clear goals themselves.

“AP3's ambition is to fulfil its mission as a responsible owner through active ownership management,” the pension fund stated.

“This means that the fund also invests in companies and sectors with high risks, provided that the companies are deemed to have the ambition to manage human rights. AP3's most serious impacts must be prioritised and dealt with first.

“Driving influence together with other investors and actors usually produces the greatest effect.

“AP3 contributes to the development of human rights by participating in several collaborative initiatives, such as the Investor Alliance on Human Rights and PRI Advance.”

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