ESG and finance

Children are key stakeholders for business both today and tomorrow, and thus sustainability and responsible business strategies are incomplete if children’s considerations are not embedded in them. 

All businesses impact children in some way, in the workplace, marketplace and community. Despite this, children’s rights, with the possible exception of child labour, remains a blind spot for most investors and in most ESG frameworks. 

This creates significant risks as investors may be directly linked to harms through their investments in companies with business practices, operations and relations that cause or contribute to harms to children. The responsibility of investors to undertake human rights due diligence in their investment activities in line with the UN Guiding Principles on Business and Human Rights (UNGPs) and the OECD Guidance on Responsible Business Conduct for Institutional Investors needs to include children’s rights. 

Similarly, although most global sustainability reporting standards implicitly include children’s rights in scope, evidence shows that the state of disclosure on business performance in respecting children’s rights is far from sufficient. This prevents key stakeholders from understanding and assessing business policies and practices, and ultimately business impact on children. 

UNICEF’s response

UNICEF recognizes that the financial services industry has a potentially transformative role in advancing the shift towards more sustainable and responsible business practices for children. To support this shift, UNICEF has focused on the integration of children’s rights into investor decision-making processes and the rapidly evolving ESG and sustainable business dialogue.

As all ESG processes are highly reliant on data being available on child rights due diligence and performance by companies, another key area of work has been to provide guidance to companies on reporting on children’s rights impacts, as well as to support the more explicit inclusion of key child rights issues in global and national sustainability reporting frameworks.

Finally, to make children’s rights data more accessible and visible, UNICEF has also conducted a number of country level benchmarking studies, analyzing trends and gaps in business practice on children’s rights.