Bond investors looking to remain true to their environmental, social and governance principles have a new tool: a ranking of European Union member countries.
The study, “EU Member States under the Spotlight,” ranked the 28 countries based on 67 human rights and 17 environmental indicators, including gender equality, labor rights, freedom of expression, and protection of the environment.
Sweden came out on top, followed by fellow Nordic states Finland and Denmark in second and third place, respectively. The U.K. is in the middle of the pack, at 13th, while Malta ranks last.
Conducted by the International Federation for Human Rights, known as FIDH, in collaboration with the U.K.'s University of Essex, the study encourages investors in sovereign bond markets to invest in those EU member countries that score highly against these indicators.
“This study subjects the issuers of state bonds, central to portfolio management, to the most rigorous and complete evaluation of human rights commitments,” said Debbie Stothard, secretary-general of Paris-based FIDH, in a statement accompanying the study.
“Human rights and the environment should be considered an integral part of states' competitive advantage, and not an optional extra that can be altered for convenience,” Ms. Stothard said.
