An institutional investor-backed initiative targeting better disclosure of company workforce management practices has kicked into action.

The Workforce Disclosure Initiative (WDI) has been devised and coordinated by ShareAction, a London-based responsible investment campaign organisation, with funding from the UK Department for International Development. Its initial aim is to gather comparable data related to workforce issues.

Founding signatories include 79 investors with nearly $8trn (€7trn) of assets under management between them. The investor group features institutions in 10 countries including major asset managers and pension investors such as APG, RPMI Railpen, NEST, and South Yorkshire Pensions Authority.

The WDI officially launched today, after a survey was sent to 75 “megacap” companies: 50 of the largest FTSE-listed firms plus 25 listed on seven other stock exchanges. The request for information covered both developed and developing economies where companies have operations and supply chains.

Firms were asked about their governance of workforce issues, global workforce composition and stability, training and development of people, and worker engagement.

ShareAction described the WDI as “a streamlined solution to the growing problem of survey fatigue and multiplication of effort by both companies and investors”. 

Isabelle Cabie, global head of responsible development at Candriam Investors Group, a WDI member, said that over the last 10 years “the market” had not focused on social metrics as much as it had on harmonisation of governance and carbon data. This was despite workforce management policies and practices having had a positive impact on corporate financial performance.

However, social-oriented initiatives are gaining momentum, she said, citing regulation such as the UK Modern Slavery Act and voluntary initiatives.

ShareAction also cited the 2004 EU Non-Financial Reporting Directive, for which the European Commission recently released guidelines.

Cabie said: “At Candriam we are convinced that we are now entering the phase where consolidation is needed and that WDI can perform this role”.

The WDI is modelled on the Carbon Disclosure Project, she said.

The UK pension fund trade body extended its support for the initiative. Luke Hildyard, stewardship and corporate governance policy lead at the Pensions and Lifetime Savings Association (PLSA), said: “As our research has found, although annual reports nearly always affirm how important their employees are to corporate success, it is often very hard to find meaningful data about how employees are managed, developed and valued.

“For pension schemes and other institutional investors this is an important consideration, because companies that think long term tend to perform better over the long term.”