Socially minded investors managing $4.7 trillion on Thursday called on businesses to prioritize the welfare of workers and other stakeholders as they decide how to respond to the economic crisis brought on by the coronavirus pandemic.
The call came as half the U.S. was under stay-at-home orders and unemployment claims hit a record of more than 3 million last week.
Leaders of organizations ranging from the Interfaith Center on Corporate Responsibility, the AFL-CIO labor federation, and the office of New York City Comptroller Scott Stringer said in a statement on Thursday that companies should consider steps like providing workers paid leave and remote work options, and “taking every measure to retain workers” to avoid layoffs.
“We all must do what we can,” Corey Klemmer, director of engagement at Domini Impact Investments, one of the letter’s organizers, said in a statement. “The decisions companies make in this moment will have profound implications for our social and economic systems.”
The statement was signed by 195 institutional investors in all. The comments underscore growing concerns that the harsh restrictions being imposed to contain the coronavirus will have more than a temporary economic impact as laid-off workers and unpaid vendors dial back their spending.
Even as layoffs spike, there is some evidence companies are looking for alternative avenues to cut costs, such as by reducing CEO pay and suspending stock buybacks, in some cases under political pressure.
Just on Thursday, two top U.S. banks, Morgan Stanley and Citigroup Inc, said they would pause on layoffs.
The letter also asked companies to maintain timely payments to suppliers, work with challenged customers, and potentially limit executive pay.