Amidst the growing consensus around the need for mandatory human rights due diligence – the requirement that businesses proactively take into account the wider impact of their operations on local communities and rightsholders – firms are seeking to quickly understand how they can meaningfully contribute to the business and human rights agenda.
The campaign for mandatory human rights due diligence is aligned with stakeholder expectations on business and human rights, which are proliferating and deepening such as:
- Regulatory action across European nations in particular, building on the UK Modern Slavery Act, the French Duty of Vigilance Act, and the recent Dutch Child Labour Due Diligence Law.
- Benchmarking initiatives such as Oxfam’s ‘Behind the Barcodes’ campaign and Know the Chain’s sectoral analyses are resonating with the wider public. Over 200,000 people have pledged to ‘take action’ in response to Oxfam’s initiative.
- Commodity level reports of abuses which reach the mainstream press; for example, on seafood and tomatoes.
- Engagement from the financial sector in the fight against modern slavery, namely through the Finance Against Slavery and Trafficking (FAST) Initiative, which provides a collective action framework for the whole financial sector to accelerate action to end modern slavery and human trafficking.
A new kind of reporting
One area of human rights due diligence that businesses continue to treat with trepidation is that of Human Rights Impact Assessments (HRIAs). These take an entirely people-centred approach to business impacts, and delve into how communities and individuals are affected by the operations of a corporate activity or activities.
Methodologies vary on how these should be conducted, predominantly because the process should be bespoke with specific communities and affected parties in mind, and the scope of any assessment is contingent on a host of factors including complexity of supply chains, level of ambition, and ultimately resources available.
We have distilled our approach to how these should be conducted into a set of seven key principles that businesses should have at the forefront of their mind as they embark on any human rights impact assessment.
1. Start by building a collaborative pilot
Every business is different, and HRIAs are a complex and potentially expensive process that is hard to get right first time. Taking a ‘design, test, evaluate, improve’ approach enables and encourages flexibility. Human rights issues are constantly shifting, so it is important to embed, evaluate and improve your approach from the start.
2. Design for scale:
With complex and global supply chains, design an approach that can be easily and efficiently scaled and adapted across products, suppliers and geographies.
For example, the approach could use desk research and draw on information that is already available (academic studies, community information etc. on specific countries, commodities and local conditions). Consider focus groups/workshops to reduce one-to-one interview time, but ensure all perspectives are covered
3. Don’t be afraid to start with a ‘good enough’ methodology:
The methodology will not be perfect from the start; it will need a continuous process of ‘design, test, evaluate, improve’ through lessons learned to ensure the right fit with business needs
4. Speak to stakeholders across the full value chain:
Interviews, workshops and focus group discussions should include relevant stakeholders from across the value chain to obtain a clear picture of impacts: rights holders; trade unions, civil society, government agencies, internal teams (e.g. purchasing, sustainability, HR etc.)
Ensure that specialist support is looped in where necessary when dealing with local communities to ensure the process takes into account all manner of cultural sensitivities and enables affected peoples to participate in a meaningful way
5. Use political economy approaches
This will help to understand the root cause of human rights impacts (positive and negative); looking beyond the actions of individuals, to identify the structural, political, economic factors that influence certain human rights impacts, and the power relationships between buyers and suppliers or employers and employees etc.
6. Be action-orientated
Action and remediation plans, developed from the findings of the assessment, must be realistic and workable for the business (rooted in organisational realities) and deliver the desired change
7. Build capacities for monitoring and reporting
Best practice human rights due diligence will be a continuous programme of measuring change against a baseline, evaluating effectiveness and making improvements. This will require an efficient and effective structure to conduct the monitoring, potentially through local teams and/or partners
The bigger picture
Taking a proactive approach to human rights within your operations, and understanding your impact on rightsholders, is a rewarding process with clear benefits.
You can understand the impacts of your operations and activities from a rightsholder perspective and ensure you align with existing international expectations, in particular the UN Guiding Principles on Business and Human Rights
You can paint a complete picture of impacts – both positive and negative – to build a strong narrative around your corporate responsibility. This allows you to prioritise and strategically engage with key business risks and opportunities, understanding where your business can have the greatest impact on your communities
This paves the way for practical and scalable action and remediation plans that can be implemented across your operations – driving change where necessary
Lastly, you will be in a better position to externally communicate a proactive approach to human rights, bringing stakeholders on your journey with the transparency they expect.
Sancroft work with businesses across a range of sectors on how to interpret the UN Guiding Principles on Business and Human Rights, and on understanding the shifting expectations of stakeholders. We can help you understand and communicate your impact on human rights – wherever you are in your journey. For more information, get in touch with Aran Spivey, Senior Analyst (email@example.com)