Prioritising human rights leads to tangible benefits for companies and employees.
Organisation: Multiples Alternate Asset Management Private Limited
Signatory type: Investment manager
HQ country: India
The approach, initiative or process
Investment managers find it easier to measure and publish data on emissions and other environmental indicators than to quantify social factors. However, social issues such as human rights abuses can negatively impact a company’s reputation and valuation.
The private markets industry has been slow to recognise the need for thorough due diligence on human rights issues within portfolio companies and their supply chains, part of a broader failure to address rights abuses. Despite global efforts to improve working conditions, 2.9 million workers in Asia and the Pacific die each year from occupational accidents and diseases, with 402 million suffering non-fatal injuries. Work-related diseases caused 1.2 million deaths and the loss of 55 million disability-adjusted life years in 2016. These incidents impact individual workers, enterprise productivity and societal welfare.
Multiples, a mid-market private equity firm with a focus on India, manages close to US$3 billion across 29 investments. We build high-quality businesses in collaboration with aspiring entrepreneurs, with a strong focus on human rights. As investment managers, we adhere to the United Nations Guiding Principles (UNGPs) on Business and Human Rights, ensuring policies and processes respect human rights.
Multiples launched Suraksha 1.0 in September 2023. Suraksha is a comprehensive framework to ensure a safe and healthy work environment, in alignment with the social pillar of ESG. The five-step methodology includes:
- governance and policy: establishing robust safety governance structures and policies;
- work/health risk and environmental hazard identification: systematically identifying and assessing potential risks and hazards;
- mitigation: implementing measures to minimise and eliminate identified risks;
- monitor and review: regularly evaluating safety initiatives and adapting them as needed;
- promote safety culture: instilling a pervasive commitment to safety across all organisational operations.
Our priority in implementing the framework was to ensure the safety of over 50,000 portfolio employees, many engaged as field staff.
Suraksha 1.0 has been implemented across 14 portfolio companies, helping them to develop policies, define board-level committee requirements and benchmark health and safety processes against national and global peers. The framework has led to:
- 14 board-level committee formations;
- 12 companies adopting Suraksha policies – especially road safety policies;
- nine companies developing comprehensive process documents;
- a reduction in serious incidents in the workforces of our portfolio companies.
The programme has encouraged stakeholders to take action at every level to prevent future accidents.
Example
Zenex Animal Health, a portfolio company, has a large field staff which is exposed to road accidents. Road safety is a significant focus in India, with its extensive road network witnessing over 155,600 fatalities in 2021, accounting for 11% of global road accidents. Road accidents cost around 3% of a country’s gross domestic product (GDP), with 92% of fatalities occurring in low and middle income countries.
Guided by the Suraksha framework, Zenex AH improved safety performance through a structured education programme on safe driving behaviour. Partnering with Hubert Ebner, a global road-safety expert, Zenex AH designed mandatory training for all employees, including new hires.
Certificates were issued upon successful completion of the assessment, with 633 employees trained in defensive and safe driving and vehicle maintenance. The programme also introduced vehicle-maintenance forms and provided medical and life insurance with coverage ranging from INR2.5 million to INR20 million, offering employees an economic safety net.
In addition, Zenex AH influenced value-chain partners to upgrade their fire-protection systems and processes. The Suraksha programme also enabled Zenex AH to review and strengthen the safety requirements of its clearing and forwarding agents.
The road-safety program at Zenex AH received positive feedback from employees and led to a reduction in road safety-related incidents and a reduction in unsafe driving risks by tracking regional and local level datapoints, such as number of incidents, 3-year trend analysis of reported unsafe driving, as well as rewarding mechanisms to recognise where incidents have been reduced.
Zenex AH represents one of several success stories across our portfolio. Other companies have created safe work cultures internally and across their value chains by, among other things, the use of digital technologies, behaviour-based learning and the adoption of industry-leading practices.
The measures to ensure transparency
To ensure transparency in the Suraksha programme, Multiples provided clear, accessible information to all stakeholders to inform decision-making.
We implemented a digital platform for overall ESG tracking, capturing Suraksha key performance indicators (KPIs). Multiples’ management teams review the resulting dashboards, providing inputs to enhance safety performance. The tool is also available to portfolio companies for trend analysis and action. Finally,
KPI outputs and outcomes are shared with investors and limited partners on a regular basis. A summary is also included in investor newsletters.
Suraksha performance is reviewed quarterly by portfolio company boards, with reports sent to Multiples. KPIs that are tracked and reviewed quarterly include the:
- total number of injuries
- total fatalities
- lost-time injury frequency rate
- number of fire or emergency incidents
- percentage of employees who have received training in safety and ESG issues
These KPIs are analysed by the Multiples team and shared with management every six months and with investors annually. All stakeholders have access to the digital platform, ensuring continuous transparency and accountability.
PRI disclaimer: This case study aims to contribute to the debate around topical responsible investment issues. It should not be construed as advice, nor relied upon. It is written by a guest contributor. Authors write in their individual capacity – posts do not necessarily represent a PRI view. The inclusion of examples or case studies does not constitute an endorsement by PRI Association or PRI signatories.
Multiples disclaimer: This case study is intended solely for informational purposes and should not be considered as investment advice. The data presented has been sourced from publicly available information, and the study highlights good practices from one of our portfolio companies. This document does not provide legal, tax, or financial advice.
