Reana RossouwWritten by

Global trends in human rights management – business, globalisation and new regulations

Advisory and consulting| Views: 271

Human rights are necessary in our modern world, as globalisation and injustice are factors that can impact business. What we all have in common is human rights, purely because we are all people and live on the same planet. Human rights are created for everyone, everywhere and should not be infringed upon by companies.

International proclaimed guidelines such as the guiding principles on business and human rights are available for all companies. The guiding principles include frameworks and remedial suggestions, making it possible for companies to incorporate new strategies. Human rights can be implemented by all businesses and there are many inspiring success stories.

Globalisation impacts trends and human rights

Because our world is constantly evolving, human rights management can be influenced by business trends and opportunities globally. New trends in human rights management embrace an “extension” of rights, meaning that additional rights are incorporated in various industries. This is an important step for companies, as some industries are more likely to violate specific human rights than others.

For example, companies producing clothing in developing countries should carefully evaluate human rights relating to labour laws. The exploitation of people to limit costs in production is a violation often associated with this industry. Looking back on historical events, clothing companies have at times received criticism regarding inhumane working hours and conditions in factories.

To embrace information that has already been established regarding human rights management is a valuable opportunity for any business. Learning about past mistakes gives a company an advantage to understand and learn about an industry more quickly.

It is important that every company should analyse and conduct research on possible human rights violations that are more likely to occur in its industry. Once research has been done, companies can create and add human rights policies to reduce risk for staff. As human rights can be industry-specific, companies should use experts who can integrate management policies in their industry.

A new awareness requires a new wave of action

Employees are more aware of their rights in our modern world, especially as human rights management is no longer a new strategy for companies. Research shows that employees who are aware of their rights are more likely to demand freedoms at their place of work. When employees are aware of human rights as a basic standard, staff as well as employers can benefit. If staff members are aware of human rights, they can take action more quickly if violations are likely to occur internally or in the supply chain.

Rights and freedoms create an environment for employees to value their place of work, which can impact the overall success and productivity for a business. In developed countries, human rights are much less likely to be infringed upon, as service delivery in most aspects works better. This includes services offered in the community, but also security measures, rights and regulations related to work.

In the developing world, human rights are more fragile, as poverty and injustice can be evident problems in society. Developing countries and fragile states must generally work harder to uphold and promote human rights. Societal problems can impact business, which makes human rights management an important strategy for business.

Companies expanding to developing countries have frequently had a positive impact on human rights, in different ways. The stabilisation of political structures in certain countries has opened up dialogue between governments and companies, linking human rights to suitability goals.

Integrating human rights as a “peace-building tool” for businesses in fragile states has important advancements. Human rights can assimilate people from different cultures and backgrounds, creating the understanding that employees are united.

More trends on human rights and business are around how companies are combining human rights management when investing in communities. CSI projects and community development can be linked to a company’s sustainability goals and financial targets. This can be created in numerous ways; the most common approach is to work directly with communities and support structures that generate employment.

Business trends will unavoidably impact human rights and investigations show that certain rights are more easily violated than others. Based on research conducted globally, these were the most common violations on human rights in 2016/2017:

  • Discrimination based on sexual minority rights, heritage and gender
  • Forced labour and human trafficking
  • Information and privacy laws
  • Supporting labour rights
  • Destroying landscapes and natural resources, leading to resettlement of communities

Companies are never entitled to take advantage of employees or individuals in society to increase sales. Modernisation can create problems, especially for telecoms and other IT-related businesses that need to protect customers’ confidential information.

Human rights violations can occur in any industry, and as mentioned earlier, some industries are regarded as more fragile than others. For example, extraordinary working conditions can impact the health and wellbeing of employees and communities in the area. To mention a few:

  • Construction workers
  • The mining industry
  • Oil, gas and petroleum companies
  • Products manufactured from the natural environment

These industries can involve unsafe working circumstances and can be damaging to the environment. The environment is protected by international laws and companies are obligated to demonstrate that they adopt sustainability policies. This global trend includes having a positive impact on local communities in relation to the environment. Companies globally also produce more reports on sustainability practices, financial targets and human rights practices, as these areas are regarded as interlinked.

Globalisation brings the world closer together, and human rights management continues to be a sustainable trend for companies. Language and cultural barriers can impact business negatively if companies struggle with communication and engagement practices. Human rights therefore work in any context, as they protect every individual associated with a business, along the entire value chain, based on local cultural differences. Therefore, globalisation can increase the risk of violating human rights when companies expand to new countries and markets.

Modernisation and technology

Innovation can reduce the number of jobs available to the public, based on advancement in technology. Some careers will be less important in the future and some will even become non-existent. Online work opportunities, which are replacing the traditional business models of physical offices, infringe on human rights. Internet-based work requires access to the internet and a computer, which is a luxury in many developing countries.

Refugees fleeing to countries where they are not able to work create challenges that companies and states need to address. We truly live in a globalised and urbanised society. Denying people work based on a situation that refugees have no control over impacts global human rights negatively.

Modernisation and trends related to human rights will impact the following areas:

  • Inequality and exclusivity of unskilled labour
  • Automation of machines replacing people
  • Free speech
  • The increase in internet-enabled work
  • Refugees and migrants looking for opportunities
  • International trade deals that impact on local communities
  • The supply chain and different working conditions across the globe

Inequality is a problem globally, as 1% of the world’s population own and earn more than the rest combined. Innovative technology is replacing people with machines, decreasing work opportunities.

Free speech and representative civil society organisations will consequently play an important role in our future. Social media and the immediacy of information counts against companies and their business practices, as global awareness about companies can negatively influence their reputation and therefore their bottom line. It is therefore in the best interest of organisations to ensure fair and ethical business practices, as well as respect for human rights, to ensure transparency and accountability. Stakeholder engagement provides an opportunity for organisations to engage proactively on human rights issues and ultimately work collaboratively to solve the biggest issues of our time.

Policies influence trends

Human rights policies are influencing management trends regarding trade deals, the supply chain and the investment sector. International and inter-governmental trade deals influence both financial and social aspects for businesses, which can be regulated in agreements between businesses. Human rights strategies can be “transferred” and impact trade agreements, and can be included in the negotiation of contracts and regulations. The same principle can impact agreements positively with suppliers in the value chain. An integrated human rights strategy is a win-win one, as it can reduce and mitigate risk for all parties involved in agreements and contracts.

The investment sector has benefited significantly regarding human rights management strategies. Human rights are valued, as they are regarded as a “common language” for companies from different countries. To be human rights-compliant, implies that companies take business seriously, valuing employees and sustainable business practices. It also shows that a company has nothing to hide and can be regarded as easier to invest in, since human rights are “recognisable” for an investor.

New European Union directives on human rights management, financial targets and the environment are legally establishing the trend of sustainability reporting. This means that companies registered in an EU country operating in Europe or elsewhere need to follow the directive. The new regulation requires companies to separate financial reports from sustainability reports.

Previously, financial reporting and information regarding people and the environment could be included in the same report. Sustainability is now regarded as a necessary strategy for business and the endurance of our planet.

The most interesting aspect of the EU directive is the inclusive description of what sustainability practises entail. Sustainability is regarded as caring for the environment and how business operations impact communities. The initiative also involves reporting on labour rights, human rights and anti-corruption awareness and regulations.

It takes time to integrate a human rights management policy for businesses. New directives and guidelines help, as they provide an overview of what is necessary to utilise the potential of the strategy.

Trends and conversations regarding human rights for business include the following:

  • Implementing tools for monitoring and preventing human rights violations or infringements
  • Failure in linking human rights management with financial targets and sustainability strategies
  • Linking human rights to environmental obligations, objectives and targets
  • Implementing the UN Sustainable Development Goals and implementing industry-specific human rights guidelines, frameworks and standards
  • Global efforts to measure and report on corporate performance on human rights and sustainable development

To integrate human rights requires that companies work with the strategy throughout all levels of the business. This is especially important for bigger corporations that can sometimes struggle to obtain influence from the executive in monitoring the implementation process.

To integrate and incorporate human rights management practices, companies require:

  • A clearly articulated vision and statement for human rights
  • A clear line of roles, responsibilities and accountability in the organisation
  • A defined and approved strategy with an implementation plan for all aspects across the business and along the entire value chain
  • Clearly defined due diligence and monitoring processes
  • A remediation plan to deal with grievances and complaints related to human rights aspects

Next Generation creates bespoke solutions for companies in all sectors regarding human rights management and sustainability practices.

  • We conduct extensive research and human rights benchmarking on behalf of companies to ensure the comparability of their human rights practices across industry sectors and geographic boundaries, including human rights strategies, policies, programmes and initiatives.
  • We review integrated and sustainability reports to ensure compliance with reporting frameworks, guidelines and standards, as well as usability, accessibility and user-friendliness.
  • We conduct country, industry and human rights risk assessments, operational impact and risk assessments, stakeholder engagement and due diligence assessments across the value chain.
  • We provide capacity-building and training in human rights practices.

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