Half of corporates unable to prove they are protecting human rights, report reveals
A new analysis of 229 of the world's largest companies has found that almost half are unable to prove they are protecting human rights in line with the UN's requirements - with more than one-third scoring zero on due diligence.
The Corporate Human Rights Benchmark from the World Benchmarking Alliance (WBA) was published today (16 November), ranking 30 major automakers and a further 199 companies across the agriculture, fashion, ICT manufacturing and extractive sectors. Corporations are given an overall score calculated using scores across six themes - are Governance and Policy Commitments; Embedding Respect & Human Rights in Due Diligence; Remedy and Grievance Mechanisms; Company Human Rights Practices; Response to Serious Allegations and Transparency.
Across the benchmarks, more than half of respondents either provided information proving that they are not complying with the UN’s Guiding Principles on Business and Human Rights, or failed to provide proof at all.
Some 79 companies scored in the lowest category against the WBA’s indicators, including Starbucks, Phillips and US-based retail giant Ross. Other laggards include Prada, Gazprom, Macy’s and Target.
Progress in the automotive industry was found to be the slowest of any sectors. Companies scored an average of 12% across all indicators and no firm scored more than 50%. Mitsubishi, Tesla, Nissan, BYD and Suzuki all received below-average scores.
The WBA called this trend “deeply concerning” and noted that little to no improvement has been made in the past year, despite mounting pressure from investors against the backdrop of Covid-19, which has highlighted and intensified dimensions of social risk.
“We’re sensing a real reluctance from the laggards to improve,” the WBA’s lead for the benchmark, Camille Le Pors, said. “And, while a small group of companies are demonstrating strong commitment and processes, it’s not always clear that these deliver their intended effects. Clearly, businesses alone won’t raise the bar and with Covid-19’s compounding impact, there is a real need for regulatory action, as planned by the European Union, as well as increased investor pressure to force change.”
The future of sustainable business
Since the World Health Organisation first declared Covid-19 a global pandemic, many businesses have faced accusations of failures to protect workers within their supply chains or operations.
Fast fashion retailers have faced criticism for not shutting warehouses or changing staff rotas so as to enable social distancing, and for cancelling and holding orders, thus risking worker livelihoods in supply chains overseas.
Similar accusations have been pointed at sectors including farming and ICT manufacturing, which are classed as high-risk for human rights.
edie spoke exclusively with the WBA’s executive director Gerbrand Haverkamp for his best-practice advice on avoiding these accusations in the future earlier this year. He spoke about how the next generation of sustainable business leadership will be centred around embedded purpose and recognising interconnected dimensions of risk and opportunity.
This sentiment was clear to see at edie’s Net-Zero Live event last week, where Unilever’s chief supply chain officer Marc Engel urged businesses to work with policymakers to deliver an "intentional" transition to a position of stewardship. Mars and Timberland agreed with Engel that the future of leadership is achieving a net-positive impact across all issues.