A coalition of investors are demanding that businesses take “decisive action” to protect their lowest paid workers during the cost of living crisis.
The coalition, which includes 15 investors with a combined £2.4trn in assets under management, argued that the lowest-paid workers are “disproportionately impacted by the rising cost of living.”
Companies should ensure that those workers should have pay awards that meet the rate of inflation, the coalition argues.
They also demand that firms commit on a long-term basis to pay the real living wage to all employees and provide secure work.
Members of the coalition include the UK’s largest asset manager, Legal and General Investment Management and the largest workplace pension scheme, Nest, as well as ACTIAM, Aviva Investors and AXA Investment Managers.
The investors, who form part of ShareAction’s ‘good work coalition’, have written to a range of companies ahead of AGM season.
ShareAction will be attending the AGMs of companies including Deliveroo, Sainsbury’s, and Next to push the firms to address inequality in a cost-of-living crisis through fair remuneration policies.
Marie Payne, responsible investment officer at ACTIAM, said: “Good human capital management, including the provision of a living wage, is part of a company’s social license to operate and it matters even more in the current context of a cost-of-living crisis.
“Companies have a responsibility towards their employees, especially the most vulnerable, to support them in these challenging times,” Payne continued.
Vaidahee Sachdev, senior impact analyst at Aviva Investors said: “We call on companies to balance the interests of all stakeholders, paying particular attention to protecting the most vulnerable parts of their direct and indirect workforce and consumer base.”
Workers in the UK have faced stagnant wages for years with some claiming the 2010s was the worst period for real wage growth since the Napoleonic Wars at the turn of the 19th Century.
According to the Resolution Foundation, since the financial crisis workers are £11,000 worse off per year due to 15 years of wage stagnation.
Rising inflation has only exacerbated the problem, tipping many into poverty. 2022 was the worst year for real-wage growth in over two decades.
According to a report from the Joseph Rowntree Foundation, 7.2m people are already going without basic goods and services