Integrating human rights management into business practice

3rd October 2017

Integrating human rights management into business practice

3rd October 2017

Integrating human rights management into business practice

Successful approaches in conducting human rights management in the world of work

Human rights impact every individual and every stakeholder involved in business. To limit risk, it is necessary to identify and analyse stakeholders along a company’s value chain. To understand human rights, what they include and how rights will impact an organisation is important for both management and business practice. To be effective in human rights management, capacity development and training in all aspects of human rights, management is required.

The next most important aspect is communication, since correct definitions and translation of human rights will “set the tone” for the company. To misinform or fail in communication is a setback and human rights management strategies will take longer to implement. The challenge is usually how the company embeds respect for human rights in the organisation.

A common language

Human rights must “make sense” to a company and there should be a clear link between human rights and business objectives. Companies can begin their human rights journeys by doing a country risk assessment. It will provide a context, set the boundaries and identify the material issues for the human rights management strategy to follow.

A country risk assessment could be supported by an industry risk assessment. It is general knowledge that some industries have greater impact, their operations present greater risk to the environment or they have extensive supply chains. Where risks are higher, a more detailed human rights management approach will be required.

An impact and risk assessment must be conducted to understand:

  • The impact of the operations on its operating context, including economic, environmental and social dimensions.
  • The influence of stakeholders and rightsholders on the operations, for instance perceptions of various stakeholder groups of the company across the economic, environmental and social dimensions.

Stakeholder engagement is an important part of human rights management. Because the operations of an organisation affect and impact its stakeholders, the actions, decisions and influences of its stakeholders can in turn have an impact on the operations.

In relation to human rights management, it is important to identify stakeholders who have rights or who have claimed to have rights over an organisation. For instance, rightsholders may include stakeholders who live adjacent to the property of a company and who may be affected by noise, dust, pollution or a neighbouring community whose air quality or water quality or access to farming land is impacted by operations.

In this regard, not only should a company test possible negative impacts of its operations on its stakeholders (i.e. infringing on their rights), but it may also positively affect (enhance) the lives of rightsholders by providing access to economic opportunities through procurement or employment, or enhance access to quality healthcare or schools through the provision and support of community development programmes. An important provision, however, is that a company cannot offset its human rights responsibilities or negative impacts from its operations by doing something good for the community.

Responsibility for the actions of company stakeholders is also an important consideration. For instance, a company should ensure that it is not complicit in the violation of human rights within its supply chain. Therefore, what its suppliers does that affects the human rights of its workers, for instance, is within the direct control of a company and therefore part of its sphere of influence. Due diligence over supply chains and procurement processes is therefore the next critical step.

Integrated approaches

Human resource departments can have a significant impact when integrating human rights as a company ethos. For example, discriminatory gender practices, where women are regarded less suitable for employment, can be ignored, as human rights management is an inclusive policy. Discrimination towards women, people with disabilities and cultural heritage will be avoided by implementing human rights-based employment, recruitment and advancement strategies.

Once a company has conducted risk, impact and due diligence assessments and evaluated its human rights risk internally and externally (including the supply chain), new policies can be incorporated. Once a human rights management strategy is implemented, companies must review the effectiveness of the management strategy. A company must track performance and establish a remedial framework as an extra layer to reduce risk.

To achieve this goal, companies must include tracking systems with formulated indicators. A company that fails to measure the advancements of the strategy and policy will have difficulties in creating an accurate remedial framework.

Human rights management is an evolutionary process

A human rights strategy and management system brings numerous benefits, including:

  • Minimising operational, legal and reputational risk
  • Maintaining a licence to operate
  • Strengthening brand reputation with shareholders, suppliers, investors, government and the media

The challenge for companies is to ensure and guarantee respect for human rights throughout the business. The initiative for human rights management practices must come from company leaders who understand the value of human rights.

Human rights management practices will be different for every company in every sector, as the impacts of the business and the rights of its specific rightsholders will be different.

Before creating a human rights management strategy, every company should consider the following:

  • What is the internal definition of human rights?
  • What is the company’s responsibility to protect?
  • What rights must be ensured?
  • Which stakeholders and which rights will be included in the human rights management strategy?
  • What risks and impacts will the company be exposed to and how will these impact business?

Next Generation has assisted numerous companies in developing human rights management strategies, policies, frameworks and guidelines. We have conducted country risk assessments, industry and impact risk assessments, stakeholder engagement and due diligence processes.

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