Sovereigns' social practices under increasing scrutiny by industry

Verisk Maplecroft launches ratings

Sovereign bond prices could increasingly be impacted by social factors, as research from global risk analytics company Verisk Maplecroft reveals the importance of human and labour rights on bond spreads and Aviva Investors stresses human rights in its latest sovereign engagement letter.

The research and ratings from Verisk Maplecroft (VM) released today (17 February) shows that human rights issues and risks relating to the energy transition are material and can impact bond spreads and borrowing costs. The firm looked at six years of historic quarterly data, covering 37 issues across nine ESG dimensions. In its research, VM noted that while governance has been an important factor for investors for a while and the environmental lens is of growing importance, the social aspect of ESG has been doubted. Their research found investors can look explicitly at social facto...