Nadine Hawa charts a momentous year, including the Corporate Human Rights Benchmark and UNGP assurance guide, new stakeholder alliances, the spread of disruptive technology and France's due dilligence law
Companies came under increased scrutiny for their performance on human rights this year as new benchmarks, legislation, and the tapping of technology helped keep rights-related risks high on the sustainability agenda.
The release of the Corporate Human Rights Benchmark (CHRB) in March was hailed as a “game-changer”. Three years in the making, the benchmark assesses 98 of the largest publicly traded companies in the world, in three industries, agriculture, apparel, extractives, on 100 human rights indicators. The results revealed that while a small group of leaders are taking a leadership position and driving forward corporate human rights performance, much work remains to be done.
Only three companies – Rio Tinto, Marks and Spencer Group, and BHP Billiton – scored more than 60% on the index, and the average score was 28.7%. The methodology was criticised by some, saying the low scores don’t reflect some of the solid work being done behind the scenes. (See Human rights briefing: new corporate benchmark a ‘work in progress’).
But Dr Margaret Jungk, human rights managing director at Business for Social Responsibility (BSR), said: “We see a growing split among companies. The best performers are doing fascinating, ground-breaking work, and adopting more and more human rights issues under the umbrella of sustainability. Others, however, are flying under the radar with few human rights principles at all.”
The CHRB study also found that companies tend to perform best on policy commitments and governance. But performance drops when it comes to acting on risks, tracking responses and remediating harm.
The annual Forum on Business and Human Rights in Geneva, the UN’s platform to assess progress in implementing the Guiding Principles on Business and Human Rights, focused on effective remedies for victims of business-related human rights abuse, the third of the three pillars of protect, respect and remedy. In a blog ahead of the event, the UN Working Group described remedy as “the most burning issue in the current business and human rights agenda”.
September saw the launch of the UNGP Assurance Guidanceby international accountancy and advisory firm Mazars and business and human rights non-profit Shift.
Government regulation remains decades behind business realities. Technology is advancing into fields none of us thought would be transformed from the inside out
The UNGP Assurance Guidance is the follow-up to the UNGP Reporting Framework and has two primary aims: to help those tasked with assessing human rights performance in business to better-understand the competencies required and what good performance looks like, and support external assurance providers as they oversee companies’ human rights reporting.
The guidance includes a set of indicators and is fully aligned with the UNGP Reporting Framework. Richard Karmel, global head of human rights at Mazars, said; “The tool will help business to firmly place human rights into core business practice.”
The launch of the Investor Alliance for Human Rights this year was another important development. Launched by the Interfaith Centre for Corporate Responsibility (ICCR), the alliance is the first platform designed to facilitate investor advocacy on human rights and labour rights issues.
While some companies have shown leadership in integrating the UN Guiding Principles into their policies and practices, the ICCR argues that most are still unaware of the breadth and depth of their human rights impacts.
I see more companies engaging in the global south like a guest, thinking of their suppliers as potential partners and actors they can learn from and grow alongside
“The alliance is being established to create an umbrella beneath which a ‘coalition of the willing’ from the investment community can advocate more immediately, consistently and strategically to protect human rights and to act as a deterrent against regressive legislative and regulatory action.”
During 2017 the news around business and human rights remained garment sector focused, with experts scrutinising progress in the Bangladesh garment industry four years following the Rana Plaza tragedy, or highlighting the plight of Syrian refugees working in the Turkish textile industry as reported by NGO Business and Human Rights.
But other areas are also pushing along with their efforts. In November a commitment was made to launch a new independent Centre for Sport and Human Rights in 2018. The planned centre – the first of its kind – is aimed at helping build a world of sport that protects, respects, and upholds the human rights of athletes, workers, communities, children, fans, volunteers, and the press.
The centre is backed by a coalition including FIFA, the International Olympic Committee, Commonwealth Games Federation, and UEFA.
Perhaps the most important legislation introduced during 2017 was the “duty of vigilance” law by the French parliament (see France briefing: Taking aim at corporate human rights abuse). Hailed as a historic step by NGO Human Rights Watch, the new law for accountability requires companies to establish safeguards designed to ensure that human rights, including child labour, attacks on trade unionists, and ill health from toxic pollution, are respected throughout their supply chains.
The requirements of the French law are notably different from laws like the UK Modern Slavery Act or the California Transparency in Supply Chains Act, which only require companies to report on their efforts.
Still, Jungk believes that government regulation “remains decades behind business realities”. She adds: “Technology is advancing at breakneck speed and into fields none of us thought would be transformed from the inside out.”
We keep telling companies that now is not the time to take a low profile on human rights, but a prominent one
This year we saw how technology and the use of big data are helping companies increase transparency and accountability in otherwise long, complex and opaque supply chains. One such use of technology is the increased adoption of predictive analytics in responsible sourcing.
Global risk analytics firm Verisk Maplecroft reported this year that the hype surrounding predictive analytics continues to grow as business leaders recognise its potential to unlock hidden value and reveal hitherto unseen risks, and to fundamentally enhance a company’s ability to understand the emerging risks within a supply chain.
Reliance on tech is giving companies access to the deeper parts of their supply chains, extending their reach well beyond first-tier suppliers and helping them address human rights issues.
Good World Solutions, whose mission is to give workers a safe, free and anonymous channel to report on everything from health and safety to job satisfaction, is leveraging technology through its mobile survey platform Laborlink.
Another example includes British NGO Twin, which is working with Dutch company Landmapp to give smallholder farmers producing cocoa in Ghana documentation proving land ownership. Landmapp uses a smartphone GPS app and maps smallholdings by physically walking around the boundaries.
And the US Department of Labor this year released a mobile app designed to help businesses root out child labour and forced labour from global supply chains. The free app, Comply Chain, provides detailed guidance on how to develop robust social compliance systems and assist companies and their suppliers in identifying, rectifying, and preventing labour abuses.
This is all being facilitated by the changing relationship between companies and suppliers, some suggest. Companies want to work with people who are willing to progress and eliminate human rights risks.
Data science tools and the use of technology to address human rights will move increasingly into day to day operations in 2018
“For decades, many companies operated in the global south as interlopers, hiring cheap labour and trampling on the environment,” says Jungk. “These days, though, as the developing world continues to grow and become more prosperous, I see more companies engaging in the global south like a guest, thinking of their suppliers as potential partners and actors they can learn from and grow alongside.”
Going into 2018, data science tools and the use of tech will continue to move into the day-to-day operations of most business functions, according to analysis from Maplecroft.
Businesses seeking to understand, address and report human rights abuses in their supply chains will continue to rely on resources such as the Corporate Human Rights Benchmark, KnowTheChain and the TiscReport.
And according to Jungk we will see unprecedented engagement from citizens. “We keep telling companies that now is not the time to take a low profile on human rights, but a prominent one. The global north and the global south are both clamouring for leaders who state principles of unity, diversity, peace and development as loudly and clearly as they can. I, for one, think companies can take up that role. And that they will.”
Nadine Hawa is a former CNBC business news presenter and producer. She has also been a sustainability consultant, working on projects with organisations including the UNEP and RSPO. She has been a regular contributor to Ethical Corporation magazine since 2012.
Main image credit: Shutterstock Inc.CHRB M&S Shift Mazars BSR supply chains smallholder farmers KnowTheChain Verisk Maplecroft human rights watch Twin Landmapp human rights in sport modern slavery