Social
The 'S' In ESG
Shining a spotlight on social issues
Social is about human rights. It relates to how a company treats its employees, as well as its policies and actions that impact society.
We believe more diverse and inclusive organisations tend to make better strategic decisions and exhibit lower investment risk.
In 2024, we:
- Engaged on 752 social themes (an engagement can cover more than a single topic)
- Co-filed shareholder resolutions at Walmart†, Target† and Kroger†, asking them to develop a policy on paying a living wage to their employees.
- We launched our human rights engagement campaign, contacting 400 companies in 43 countries, across selected ‘high risk’ sectors: utilities, energy, mining and minerals, apparel and textiles, technology and automotives.
- Published our Human Capital Management Policy in November, setting out our expectations of companies on how to manage their labour force.
Spotlight on diversity
We have engaged with companies on the topic of diversity since 2011 and has been actively voting on the issue since 2015.
Our Diversity Policy sets out our expectations of companies in which we invest globally. We expect all companies to be transparent and to disclose diversity and inclusion policies and representation data at four levels: Company board, Executive committee / senior leadership team, Management and Entire workforces.
By setting out its expectations clearly, we aim to help companies understand where improvement is needed.
In 2024*:
- Over 2,000 companies were subject to voting sanctions based on failing our minimum expectations on diversity.
- We conducted 32 corporate engagements focused on gender diversity.
- 9 companies in the US and the UK were subject to voting sanctions on gender diversity in executive leadership teams.
- 2 UK companies were subject to voting sanctions due to a lack of board-level ethnic diversity.
Spotlight on healthcare
We believe there is a strong link between social health and economic health. The impacts of obesity and undernutrition, pollution, pesticides and antimicrobial resistance can ultimately affect the long-term returns of our investments.
Antimicrobial resistance (AMR)
We have identified AMR as a key health area and considers it to be a financial and societal risk. AMR is the damaging effect of disease-causing microorganisms (for example, bacteria, viruses, fungi and parasites) increasing their resistance to antibiotics. A Lancet study published in January 2022 confirmed that 1.27 million deaths globally in 2019 were directly attributable to bacterial AMR, with 4.95 million deaths indirectly linked to it.1
While policy engagement remains a core focus of our work on AMR, it is also supported by corporate engagements and our voting activity.
Our approach will continue to be based on these two strategies: raising awareness among policymakers and international stakeholders with the power to drive change, and supporting these activities through our voting and company engagement. Further details on this theme can be found in our Health Policy.
Our asset management business is an investor member of the Investor Action on AMR, founded by the Access to Medicine Foundation, FAIRR Initiative and UK Department of Health and Social Care. We supported the Call to Action that Investor Action on AMR sent to G7 finance ministers in 2021, highlighting various policy actions that governments could implement to tackle the growing threat of AMR. We continue to work with Investor Action on AMR.
Nutrition
Nutrition can have a significant impact on the health and wellbeing of individuals, communities, and societies. Poor diets generate more disease worldwide than physical inactivity, alcohol and smoking combined.2
There is a clear link between poor diets/ malnutrition and chronic health conditions, such as obesity, heart disease and diabetes (non-communicable diseases). These conditions can in turn lead to increased healthcare costs and decreased productivity, both of which will have negative impacts on the economy.3
As an example, in April 2024, we announced that we were co-filing a shareholder resolution (company matters which shareholders can vote on) at Nestlé’s annual general meeting (AGM) under the umbrella of ShareAction’s Healthy Markets Initiative. We asked the company to publish more effective targets to increase healthier food choices.4 We noted our vote in our pre-declaration blog. The resolution received support from approximately 11% of shareholders, which was lower than what we had hoped for.
We have continued to engage positively with the company on nutrition, together with other investors in the Healthy Markets Initiative, and met its newly appointed CEO in December. We were pleased with the frank discussions and positive exchange of ideas during our meeting, and we look forward to continuing the dialogue with the company during 2025.
- The Lancet; Global burden of bacterial antimicrobial resistance in 2019: a systematic analysis, 2022.
- Access to Nutrition Initiative, ‘Investor Expectations on Nutrition, Diets & Health’, June 2020.
- GBD 2017 Diet Collaborators, Health effects of dietary risks in 195 countries, 1990–2017: a systematic analysis for the Global Burden of Disease Study, 2017.
- See our 2023 active ownership report for more information on this co-filing.
*All data based on our asset management business’s internal vote data, 2024.
† For illustrative purposes only. Reference to a particular security is on a historic basis and does not mean that the security is currently held or will be held within our portfolios. The above information does not constitute a recommendation to buy or sell any security.
Find out more
Taking action
Find out how we've influenced companies to achieve better environmental, social and governance outcomes.
Environment
The action we are taking to protect the wellbeing of our planet.
Governance
How we ensure companies are well run.
The value of your pension savings can go down as well as up and is not guaranteed.
Most of the activity described on this site is carried out by Legal & General's Asset Management who manages your funds and makes the day-to-day investment decisions.
All our funds are managed by professional fund managers but some of the funds available to you are not managed by Legal & General. External fund managers may take a different approach to responsible investing.
Throughout this site, we use companies as examples of the action we take. The issues highlighted are not exclusive to them.
Reference to a particular security is on a historic basis and does not mean that the security is currently held or will be held within an L&G portfolio. The information on this site does not constitute a recommendation to buy or sell any security.