Half of corporates unable to prove they are protecting human rights , report finds

The analysis ranked corporates across four high-risk sectors

Conducted by the Corporate Human Rights Benchmark (CHRB), the analysis uses publicly-available data to assess the world’s largest listed companies in four high-risk industries – agricultural products, fashion, extractives and electronics manufacturing – against the UN Guiding Principles for Business and Human Rights.

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.

Of the businesses assessed, 95 scored a zero in all six themes.

Across all themes, the average score among the cohort of 200 businesses was less than 50%. Average performance was found to be particularly poor in the themes of Embedding Respect & Human Rights in Due Diligence (23%); Company Human Rights Practices (21%) and Remedy and Grievance Mechanisms (20%).

When business’ overall scores are analysed, the picture is not much better. More than half (105) of the corporates scored less than 20% overall, while only one – Adidas – achieved a score of more than 80%.

CHRB notes that low scores do not necessarily mean companies are not taking action; in most cases, they are due to a lack of data. But, given that one of the UN’s Guiding Principles is transparency, these data difficulties are, in themselves, telling.

“In aggregate, the 200 companies are painting a distressing picture; most companies are scoring poorly and the UN Guiding Principles are clearly not being implemented,” CHRB’s chair Steve Waygood, who is also Aviva Investors’ chief responsible investment officer, said.

“That one-quarter of companies score less than 10% and a full half of companies fail to meet any of the five basic criteria for human rights due diligence should alarm governments and investors.”

In order to help tackle these issues, CHRB will be merging with the World Benchmarking Alliance (WBA) – a move it claims will scale up the bodies’ impact “while maintaining deep analysis of high-risk sectors”. After the move, the vehicle manufacturing sector will be added to the human rights analysis. WBA notably publishes an in-depth analysis of this sector’s climate action every year.

Leaders and laggards

The publication of the CHRB report is timely, given that the UK’s Modern Slavery Act will celebrate its fifth anniversary later this month.

In addition to overall scores, the report serves to highlight the corporate leaders and laggards on not only modern slavery, but a range of other human rights issues in and beyond the workplace.

Adidas was the top scorer, with CHRB praising the apparel giant for establishing a third-party complaints mechanism and making information on its use available through its corporate website. Adidas has also engaged trade unions, environmental and social campaign groups and individuals across its communities, to provide trained “human rights defenders” – eyes on the ground to assist with prevention and remedial action.

These and other measures have previously seen Adidas top Fashion Revolution’s transparency index and Know The Chain’s apparel and footwear benchmark.

Other high-CHRB-scoring firms include Rio Tinto, BHP, Repsol, Unilever, Marks & Spencer (M&S) and Freeport-McMoran – all of which received 70%-80% overall scores.

At the other end of the scale, corporates to have received an overall CHRB score of 10% or less include Starbucks, Monster Beverage, Foot Locker, Costco and Ross.

Sarah George