ADAS, an RSK company, has worked with a range of benchmarks and has helped companies to identify actions and processes to improve their scores for the future. Conor McMahon, sustainable supply chain consultant, ADAS, sets out the findings from the latest benchmark launch and considers what the businesses in the study should be doing to ensure they continue to improve their efforts on human rights and, therefore, their CHRB score.
Benchmarking, scoring companies using publically available information against a clear set of criteria, is becoming an increasingly common method of holding businesses to account for their social and environmental performance. These benchmarks play on the competitive nature of the markets to drive improvements across industries and are frequently being used to guide what is considered business best practice and extenuate the business case for action.
With an overall average score across all the businesses studied of 28.7% and with only six companies achieving over 50%, the CHRB highlights considerable opportunities for improvement and shows that many businesses still have a lot of work to do in implementing the UN’s Guiding principles on business and human rights. At the same time, the leading organisations identified in this benchmark provide an initial template for other companies to follow. What can big businesses learn?
Human rights and businesses
Human rights are the basic rights and freedoms to which all humans are considered entitled. Businesses play a key role in protecting these and in securing jobs, improving livelihoods and supporting community development. However, where oversight and visibility are lacking, and without a sound commitment to human rights and their implementation through due diligence, a workforce can be mistreated, indigenous peoples can be dispossessed of their lands and individuals can be subjected to modern-day slavery.
Businesses have both a moral and a financial imperative to prevent, address and remedy any human rights abuses committed, particularly those linked to their business operations. There have been ongoing efforts in this area from the global business community, predominantly since the UN Guiding Principles release in 2011. This has led to a far greater awareness of the salient issues facing specific industries with countless beneficial initiatives being pursued and, ultimately, improving livelihoods. However, on such a fundamental and emotive issue, there is always more to do.
The CHRB ranks the top 98 companies from the agricultural products, apparel and extractives industries on their corporate human rights performance. The companies were assessed against a detailed methodology made up of six measurement themes (Figure 1) and developed over two years of multi-stakeholder consultation. The CHRB’s vision is to harness the competitive nature of the markets to drive better human rights performance. To see how individual companies got on, please see the inaugural benchmark.
Key messages from the report
The CHRB highlights that there is a lot of scope for improvement. An overall average score of 28.7% is, as the report states, an important if uncomfortable finding. This reflects the early stage that many companies are at when it comes to implementing the UN Guiding Principles and other human rights and industry standards. Indeed, the critical mass of companies (48 out of the 98 companies) achieved an overall score of between 20–29%; hence, there are considerable opportunities to improve in subsequent years.
There is a big variation in performance between the leaders and the laggards. The leading companies in the benchmark, including Marks & Spencer, Nestle and Unilever, have all demonstrated clear action on human rights across all six of the measurement themes. The critical mass of low-performing companies should look at the activities of the leading companies within their industry and invest in improving their overall performance.
Next steps for businesses
This first CHRB is, inevitably, a snapshot of some companies’ human rights performance at one point in time. The release of this benchmark should be seen as an opportunity to engage and initiate a conversation within your business. No matter how your business performed, it is not too late to act. Stakeholders will look favourably on businesses that can demonstrate clear intent, investment and improvements year on year.
- Analyse your score. Look at where points might have been deducted and complete a gap analysis of what is required to score higher in future iterations.
- Look into the feasibility of achieving the additional criteria. Investigate current levels of transparency, existing supplier relationships and engagement and then look at the cost, engagements and time necessary to meet additional benchmark criteria.
- Set clear company objectives: These should include a timeline for achieving them.
- Develop a programme of change. This programme should seek to fill the space between current practice and aspirations by defining specific commitments, activities or interventions that must be put in place, and set out how these lead to desired goals being achieved, including incremental targets.
- Develop a monitoring programme to demonstrate progress and continuous improvement.
- Engage with the benchmark when given the opportunity. It is important that the businesses included in the CHRB have their say in its ongoing development.
ADAS support its clients in developing and implementing responsible sourcing, risk management and resource efficiency strategies, generating cost savings and building business resilience. To discuss how ADAS can support your business in setting objectives and putting a programme in place to achieve them, please contact Conor, firstname.lastname@example.org.