In a significant development, a group of 50 investors managing with more than $4.5 trillion in assets in total, have called on companies which are involved in the development and use of facial recognition technology, to do so in an ethical manner.
The investor group, led by asset manager Candriam said, given the lack of consent of those being identified, facial recognition technology infringes on individual’s privacy rights, especially since there is no law or framework which officially oversees the technology.
The initiative marks how fund managers are increasingly taking up policy issues that were once considered fringe subjects for shareholders as retail investors sink billions of dollars into funds focused on ethical and sustainability criteria.
According to human rights advocates, facial recognition technology can be used to unlock smart phones or verify bank accounts, it can also potential be used by governments to track citizens and suppress political dissent.
In a statement the investor group said, it would begin a two-year process of engagement with companies developing or using facial technology and will considers 34 companies to be leaders in facial recognition, including Huawei, Amazon, Alibaba, and Facebook.
A spokesperson from Amazon declined comment. The other companies did not immediately respond to requests for comments.
Last month, Amazon said it was extending a moratorium on the use of facial technology by law enforcement. Civil liberties groups have warned inaccurate matching could lead to unjust arrests.
“For investors to be able to fulfil our own responsibility to respect human rights, we call on companies to proactively assess, disclose, mitigate and remediate human rights risks related to their facial recognition products and services,” said Rosa van den Beemt, Responsible Investment Analyst at BMO Global Asset Management.
The facial recognition technology market is set to balloon to around $10 billion in 2020, said Candriam in a report, citing a 2018 survey by Allied Market Research.
Among those to sign up to the investor initiative were Britain’s Aviva Investors, Royal London Asset Management, Canada’s BMO Global Asset Management, Dutch-based NN Investment Partners and Norway’s KLP.
“The increasing deployment and use of facial recognition technologies have human rights implications which are not fully being considered by companies,” said Louise Piffaut, Senior ESG analyst at Aviva Investors.
In April, the EU’s privacy watchdog said, facial recognition technology should be banned in Europe given its “deep and non-democratic intrusion” into people’s private lives.