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Since the United Nations Guiding Principles on Business and Human Rights proposed by the UN Special Representative on business and human rights John Ruggie were formally endorsed by the Human Rights Council in 2011, companies have regularly questioned how they can incorporate human rights into their strategies. A five-step process can help a company move from mere declarations of commitment to respecting and promoting human rights towards embedding the fundamentals into everyday business.
Step 1: Increasing employees’ knowledge of human rights
The first step for any company is to understand human rights and how different departments can contribute to respecting and promoting them. There is a difference between formally claiming to commit to human rights promotion and understanding how the broad spectrum of human rights principles relates in practical terms to each function of a company. This means that leaders and employees in different departments must be informed and acquire a greater knowledge of human rights to ultimately understand how their daily work can have a positive or negative impact on human rights. Through training and education, employees can be empowered to identify human rights risks, such as for example forced labour, harassment and discrimination that can take place in headquarters as easily as it could with local and global suppliers. By educating employees and senior management, a company can bridge the gap between policy, governance and a firms operations and management.
Step 2: Moving from commitment to strategic implementation: leadership and cross-sector strategy
A company can formalise its commitment towards human rights into its vision and mission to guide and inspire what is to be achieved by the firm over time and enhance the way employees operate. Such vision and mission needs to be embraced by leaders to ensure that commitment is driven from the top levels of the organisation and that employees are encouraged to act on human rights concerns and opportunities that they may encounter. Incorporating human rights into a company’s strategy requires a cross sector approach where different departments are involved into the strategy’s development and implementation. This means involving human resources, the legal department, supply chains, procurement, finance and marketing. Only a synergic approach, which does not rely solely on the sustainability or CSR team, can drive change within a company. At a time of raising mandatory legislation (e.g. UK Slavery Act 2010, the EU Non-Financial Reporting Directive, the Bill 501 on human rights and environmental reporting for large companies in France), synergic strategy is becoming necessary. For example a procurement officer can be skilled at procuring services; however s/he requires the expertise of the legal department to keep up to date regarding new legal developments and obligations and to audit suppliers in a relevant manner.
Step 3: Engaging stakeholders
Stakeholder engagement is beneficial to a company that is willing to identify, address and find solutions to salient human rights issues. Through regular consultations with external stakeholders (local communities, governments, trade unions, NGOs etc…), different departments can better appreciate the impact of their business and identify salient human rights issues which require comprehensive and relevant approaches to achieve sustainable solutions. A commodity business for instance can engage external stakeholders to address issues that it cannot solve alone, such as trafficking, child labour and forced labour. For example companies have engaged with sustainability NGOs and private organisations that provide training to their suppliers and work with them to improve labour and human rights conditions in the supply chain. Engaging with external stakeholders also ensures that a company reviews its policies regularly, since human rights risks can change over time and need regular monitoring.
Step 4: Monitoring and articulating impact
A company can work with stakeholders to identify relevant KPIs that will allow comparisons over time and as well as with other similar organisations. Quantitative monitoring is to be complemented by qualitative analysis that ensures a comprehensive social impact analysis is provided. This information can be integrated into social accounting and social impact analyses that are independently verified by a trusted organisation to ensure they are accurate. Results can be shared with staff, the board and stakeholders to demonstrate progress and maintain commitment.
Step 5: Acknowledging shortcomings and a willingness to improve
Last but not least, integrating human rights into a business strategy requires the humility to admit errors and a willingness to find solutions. A defensive attitude tends to be counterproductive to a company’s reputation especially when there is evidence of human rights violations. Disclosing challenges and strategies to overcome them can be beneficial to the company’s reputation as well as provide inspiration to all employees. The company’s leadership should also test its assumptions on regular basis and review its policy together with other stakeholders to ensure the senior management is always informed of potential human rights risks and provides a prompt response and solution.
The incorporation of human rights into modern-day company means going beyond the reliance on CSR department. It requires a shift into employees’ mindset, strategic cross department approach, stakeholder engagement, monitoring and more importantly the acknowledgement of shortcomings.