The “S” in ESG investing stands for Social. Social indicators are a reflection of how well an issuer integrates with society overall and its workforce more specifically, taking into account issue like human rights, labor practices, and working conditions. Corporate policies in regards to LGBTQ+ rights and gender diversity are also a significant component of Social screening analysis, with many socially responsible fund managers weighting these components heavily in their analysis criteria.
Examples of “social” red flags are human rights abuses, child labor, skills shortages and workplace fatalities.
The Human Rights Responsibilities of Business in a Changing World - ebook.