Global investor alliance managing $5.7 trillion unites to improve population health

Thirty five investors managing over $5.7 trillion have come together in a new alliance committed to building healthier, fairer societies. The Long-term Investors in People’s Health initiative, led by ShareAction and supported by The Health Foundation and Guy’s & St Thomas’ Foundation, is uniting asset managers and asset owners who want to prioritise population health.

Investors have an enormous influence on people’s health through the companies they invest in – which shape the physical and mental health of workers, customers, and wider society. Yet most investors are overlooking health as an ESG issue, partly because of the lack of good quality and comprehensive data.

The new initiative, launched today, will give investors the tools to improve health outcomes for workers, consumers, and communities, by sharing best practice and creating opportunities to collaborate on corporate engagement. Investors are asked to commit to embed health into their policies and practices and use their influence to accelerate impact throughout the investment sector.

Signatories across the UK, America, Japan, and the Netherlands include Legal and General Investment Management, Hermes Investment Management, Mitsubishi UFJ Trust & Banking Corporation, the Local Authority Pension Fund Forum, American Century Investment Management, Guy’s and St Thomas’ Foundation and The Health Foundation.

Poor health already costs 15 percent of global GDP.[i] Health inequalities are widening, and the cost-of-living crisis is creating urgent challenges for people’s physical and mental health. In Britain, fewer than one in 10 men, and only 16 percent of women, are likely to be in good health by the time they retire. Covid-19 has exacerbated existing health inequalities, with mortality rates up to four times higher in the most deprived areas of the UK.[ii]

With up to 80 per cent of people’s health determined by the jobs they do, what they consume, and where they live, approaches taken by the investment sector can have a huge positive impact. This is starting to be seen in efforts ranging from encouraging food companies to improve the healthiness of their products, to ensuring businesses pay a Living Wage.

Catherine Howarth, Chief Executive of ShareAction, said:

“Economies depend on healthy populations just as they depend on a stable climate. Yet health remains an ESG blind spot for many investors. With the launch of Long-term Investors in People’s Health, we’re determined to change that. Health deserves to be at least as well embedded in mainstream investment practice as climate risk. We’re excited to be working with investors around the world to harness their potential to build healthier, fairer societies. We invite asset managers and asset owners to support this vital work.”

ShareAction’s research has identified significant gaps in investors’ understanding of health and associated risks, as well as opportunities for improvements that could strengthen the resilience of investors’ portfolios.[iii] Two thirds of asset owners surveyed were not aware of options to invest in funds delivering positive health impact. Three quarters of asset owners said they receive minimal or no information from their fund managers on stewardship in relation to health.

Health is largely absent from asset managers’ risk and ESG assessments, and isn’t routinely captured in sustainability indices. At the same time, companies face strengthening regulation focused on how their products and policies contribute to public health. For example, over 50 jurisdictions now have sugar taxes in place.[iv]

Investors and businesses also need to meet shifting public demand. In the UK, more than 70 per cent of people say they want their investments to avoid harm and achieve good for people and the planet.[v]

Dr Jennifer Dixon CBE, Chief Executive of the Health Foundation, said:

“Overlooking health brings clear risks to investors and businesses – not least reputational damage. Investors must seize the opportunity that improved health presents – including helping people to enjoy healthier lives, enabling companies to access a healthier job market, and ultimately strengthening their portfolios.”

Kieron Boyle, Chief Executive of Guys & St Thomas’ Foundation, said:

““We can’t have prosperity without good health. Improved public health could add £10 trillion to global GDP by 2040, as well as better and longer lives for us all. A clear commitment to investing in a healthier economy should be the aim of all forward-thinking investors. We look forward to working with the growing global alliance to support the scale and pace of change needed to create a healthier society.”

Positive momentum among investors is starting to build. For example, Legal & General has called for a ‘H for health’ to be included in the ESG approach. Asset managers are starting to bring health analysts into sustainability teams, and a growing number of asset owners are including health as an explicit theme in responsible investment policies.

John Godfrey, Director of Levelling Up at Legal & General, said:

“We need all investors to see health as an urgent risk and to avoid the health equivalent of the stranded asset. This new global alliance will be an important forum to demonstrate leadership, shape guidance and best practice, drive policy conversations and influence the data landscape. Together, we can push health up the responsible investment agenda – which everyone stands to benefit from.”

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