The imminent floatation of Deliveroo on the London Stock Exchange has been dealt a rebuke from four of the market’s biggest institutional investors.
Aberdeen Standard, Aviva Investors, BMO Global, and CCLA that collectively manage funds of circa £1.5 Trillion, have all excluded themselves from acquiring shares in the Deliveroo floatation, citing the treatment of workers by Deliveroo as unsustainable.
Deliveroo riders are classified as self-employed, which sees them as not entitled to earn the minimum wage, holiday pay, or sick pay.
The investors now boycotting the listing are saying the way Deliveroo employs and treats its riders is not socially acceptable.
In any city centre riders can be seen darting around cars and trucks without even the most basic of protection including a safety helmet. At night, the same can be ‘seen’, just about, as more often than not lighting is not provided for cyclists making their deliveries.
The Head of UK Equities at Aberdeen Standard, Andrew Millington told the BBC’s Today programme that the conditions were a “red flag”, and: “We wouldn’t be comfortable that the way in which its workforce is employed is sustainable.”
He went on to comment that it would be interesting to see whether Deliveroo can attract investors over the longer term “without making progress” on worker rights.
The listing is set to raise around £9 billion, and will almost certainly be fully subscribed.
Deliveroo is set to face numerous legal challenges in the months and years ahead on whether it can maintain the employment status of riders. The company has set aside more than £112m to cover potential legal costs and covered that eventuality in its launch prospectus.
With Uber recently facing similar challenges, and loosing, it could be that Deliveroo may need to examine its sustainability credentials sooner than it may wish. The added costs of being forced to recognise workers rights may also prove Aberdeen Standard, Aviva Investors, BMO Global, and CCLA as prudent.
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Hospitality & Catering News: Deliveroo dealt a £1.5 Trillion sustainable rebuke from investors. – 25 March 2021 – Deliveroo dealt a £1.5 Trillion sustainable rebuke from investors.
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