Achieving a step change in monitoring companies’ just transitions and investment
As London Climate Action Week gets underway, rising uncertainty in economic and political outlooks is threatening effective and coordinated climate action, including by companies, investors, and rightsholders. Rob Macquarie and Judith Tyson outline insights from an interactive workshop that considered the channels and sources of information needed for successful just transition action.
Companies and investors seeking to protect returns need to find an appropriate response to climate and social imperatives. Critical to their ability to do so is transparent and credible information. This includes corporate transition plans that address climate-related social opportunities and risks. It also requires processes that facilitate stakeholder groups like workers and communities being able to see, contribute to and challenge the information that companies are providing.
Recent research by the Just Transition Finance Lab showed that existing information is useful but insufficient to meet these needs. More effective just transition data, metrics and indicators are needed to support investment decisions and reflect the perspectives of ‘rightsholders’ – so termed by the Lab because of the strong link between human rights and just transition impacts. But what should support look like and who needs it most? Critical breakthroughs can come from reaching a shared understanding about these needs, and from sparking new collaborations to meet them.
Monitoring progress – insights from a multi-stakeholder workshop
The Lab held a workshop on 2 June 2025 with a diverse group of practitioners. The aim was to reflect on emerging ‘best practice’ for just transition information, indicators and metrics, build shared understanding of monitoring and shaping companies’ just transitions, and collaboratively explore potential individual and collective action.
Participants included asset owners, asset managers, standard-setters, advisory organisations and rightsholder groups representing workers and communities. Expertise covered social impact, human rights and climate alignment. Collectively, they brought diverse viewpoints on the challenges posed to just transition action and the energy to exchange perspectives and seek solutions together.
Below are seven headline insights from the session.
1. Available information contains significant gaps
There was consensus that existing resources and tools fall short of what is needed to support effective monitoring. To support financial decision-making and assess the efficacy of rightsholder participation, there are significant information gaps that need to be plugged to inform financial decision-making on just transitions.
However, views diverged on the utility of current data for determining where the most financially and systemically material social impacts would emerge among companies and their activities. Some participants recognised positive momentum in certain areas, such as data on the social impacts of transitions in extractive industries, and developing consistent worker-focused metrics. Yet there was a widespread perception that data across sectors remains fragmented and inaccessible.
2. Just transition remains too abstract for many decision-makers
Regarding guidance for investors, concerns included that ‘just transition’ remains an abstract concept and this leads to polarisation and barriers to its broader uptake. Pilot projects to implement measures for the social element of companies’ transition plans and more concrete examples showing just transition measures in existing industries were suggested as important measures to remedy this.
Participants also noted gaps in terms of asset owners not clearly setting expectations for asset managers related to just transitions, a lack of clarity about what questions to ask investee companies on stewardship, and limited resources to carry out company engagement to the level of detail required.
3. Access to thresholds and rightsholder data is weak
All participants agreed that thresholds to determine which company activities are ‘good’ or ‘bad’ enough to affect decision-making, and sector-specific benchmarks (beyond a few early-stage examples with limited coverage, like in renewables and heavy industries), are particularly lacking and a critical gap. Likewise, access to rightsholder data to validate company-provided information was seen as a weak area by most participants. Some argued that rightsholder engagement should be embedded in human rights and environmental due diligence (HREDD) processes by companies, in turn driven by regulatory requirements.
4. Lack of sectoral nuance in some just transition frameworks limits their potential uptake
Participants raised questions on the value of seeking sector-agnostic metrics, which may be potentially misleading if they obscure important sector-specific risks, opportunities or policy dynamics. Definitions of communities and supply chains vary widely by sector and region, making it harder to apply common frameworks. Lack of data and research in non-extractive sectors like manufacturing was also flagged as an issue, whereas comparative industries like mining and oil are better documented and monitored.
5. Institutional norms and mandates constrain how information is used
Challenges are structural and persistent, rather than the result of isolated shortcomings. Contributions during the workshop demonstrated a clear connection between individual organisations’ efforts and the systemic dimensions of just transitions.
Differences between passive and active investment were noted, and some participants questioned whether existing institutional mandates provide sufficient scope for deeper investor–stakeholder engagement. Some asked about the level of detail needed when dealing with the impacts of large multinational companies; others expressed the view that policy involvement is important to incentivise investor participation.
6. Stakeholder reporting requires specific data and processes
Helping investors identify relevant stakeholders across the value chain, regardless of their formal relationship to the company, was highlighted as a major need. This led to the suggestion that new tools and channels could be necessary to bring these groups more effectively into scope. Participants saw worker-related metrics as a feasible starting point for consistent just transition monitoring, given companies’ direct access to workforce data.
While guidance and principles exist to bring relevant data to light, participants emphasised that the value of such support depends on links to its real-world application, such as through sector-specific examples, defined thresholds or use cases aligned with existing investor and company processes.
7. Advanced methods for stakeholder engagement are needed
Participants displayed a strong interest in improved and novel channels for exchanging information that go beyond conventional mechanisms – including how investors engage with workers, representatives of communities and supply chain actors. Institutional and structural barriers complicate meaningful engagement, especially when multiple actors are involved. Uncertainty can affect who should lead, what the goals would be, how to draw boundaries where just transitions need to be systemic, and how information will be used. The group agreed that clear purpose is important to avoid leading to stakeholder fatigue. Some participants noted a risk of poorly targeted processes becoming burdensome, particularly as corporate HREDD becomes a regulated requirement within the EU.
The group considered suggestions including multistakeholder initiatives, investor–union channels, or structured dialogues as formats that could offer legitimacy and reduce legal risk. As an example, broad engagement mechanisms might set an objective of revealing examples of good and bad practice.
Conclusion
A just transition at the company level is characterised by a duality between entity-level and systemic factors, including in terms of accountability to stakeholders.
Our expert and practitioner workshop generated a clearer sense of gaps in the investment ‘value chain’ where the just transition could be incorporated more strongly. It also highlighted that accountability to rightsholders is a critical area to improve company and investor just transitions.
These findings reinforce that barriers to just transition monitoring are not incidental but systemic limitations in how existing tools, processes and mandates are designed.
Practitioners meeting in London this week and other sessions throughout 2025 need to consider how they embed social and climate priorities into their institutions, including adequate resourcing. To overcome limitations and generate data on which to base robust decisions, they should prioritise collaboration, including beyond sectoral and industry siloes.
The Just Transition Finance Lab is hosting an event at LSE, ‘Navigating the headwinds: uncertainties and resilience of a just transition future’ , as part of London Climate Action Week on 27 June 2025, 9:30–11:30am. Register for the event here.
The authors would like to thank Rowan Conway and Georgina Kyriacou for their feedback on a draft of this commentary.