Projects

Addressing human rights risks in indirect investments

Fugleperspektiv af industriel konstruktion
This project focuses on implementation of human rights due diligence in indirect financing operations via funds.

The Danish Institute for Human Rights (DIHR) is collaborating with Swedfund, Sweden´s development finance institution (DFI), to support its implementation of human rights due diligence in indirect financing operations via funds.

About Swedfund

Swedfund is the Swedish Government’s Development Finance Institution for sustainable investments in developing countries. Its mission is to finance and develop sustainable businesses.

Swedfund’s investments are made on commercial terms in the forms of equity, debt and fund investments within the three sectors Energy & Climate, Financial Inclusion and Health, mainly focussed in Sub-Saharan Africa and south Asia. Funding for Technical Assistance can be used to boost the development of Swedfund’s portfolio companies.

Purpose

The collaboration aims to strengthen the application of Swedfund´s human rights due diligence as it relates to its investments in funds. Specifically, DIHR will contribute to:

  • Strengthening of Swedfund’s processes and guidance on human rights due diligence for funds in accordance with international standards such as the UN Guiding Principles on Business and Human Rights;
  • The strengthening of the capacity of two fund managers to conduct human rights due diligence of portfolio companies in India.

The difference we make

In Sweden state-owned companies are obliged to comply with the UN Guiding Principles on Business and Human Rights and implement the principles in their business activities. Swedfund has included a reference to the principles in its Sustainability Policy.

To guide systematic management of human rights issues in investment activities, Swedfund has introduced a process to identify, mitigate and account for negative impacts on human rights. The ambition is to apply this approach when reaching decisions concerning new investments, during the value-adding phase and in connection with companies in the exit phase.

Today, the process is mainly applied in conjunction with direct investments and, to a lesser extent, when investing in financial institutions and funds, partly because Swedfund as an investor is further removed from the final beneficiaries than in direct investments.

Period

Start: January 2020

End: December 2020

Contact

Chief Adviser, Human Rights, Tech and Business
Adviser, Human Rights, Tech and Business