The investor group led by Candriam surveyed 15 companies involved in FRT to understand how they assess, manage and mitigate human right risks.
Benjamin Chekroun, engagement analyst at Candriam, said that greater oversight and understanding of companies involved in FRT is now “a human rights imperative” given the delay in regulating the technology and the fast pace at which it is evolving.
“As investors in the technology sector, we have an important role to play in encouraging companies to identify, manage and to mitigate human rights risks in their use of AI and FRT,” he said.
Louise Piffaut, senior ESG analyst from Aviva Investors, said that with regulation remaining limited in the technology sector, companies are not yet taking full account of their responsibilities in managing the societal impacts of FRT.
“Investors have an important role to play in pointing to best practice and engaging with companies on the issue,” she said.
The resulting report found that three companies that stood out for their efforts to mitigate human rights risks within their use of AI and FRT were Microsoft, Motorola Solutions and Thales.
According to the report, Microsoft has established strict guidelines for the morality of AI and has recently discontinued its facial recognition technology. The firm was also one of the first software companies to halt the sale of FRT to law enforcement.
Motorola has emphasised that FRT should assist humans rather than make consequential decisions and has built two-factor authentication into their technology, Candriam said, while Thales’ FRT assisted passport control involves strict monitoring and makes a point of destroying user data after each passage.
This report follows the launch of Candriam’s FRT campaign in March 2021 and the subsequent signing of the investor statement on facial recognition by 55 global investors in June 2021.
As a next step, the asset manager will lead discussions with each FRT company on how they can implement the suggested best practice into their business operations. The outcome of this second round of engagement should be released in 2023.