The 2018 report of the Corporate Human Rights Benchmark has identified a major failure in about 40% of the world’s biggest mining, agriculture and clothing or footwear companies when it comes to demonstrating respect for human rights on paper or in practice.
The CHRB, a UK based not for profit organsiation, which is an ally of the World Benchmarking Alliance, said it used publicly available information on issues such as forced labour, protecting human rights activists and the living wage to score companies up to 100% relative to 100 indicators based on the UN Guiding Principles on Human Rights.
According to this year’s scoring, 60% of those companies analysed scored less than 30% overall. 40 out of 101 companies analysed failed either on paper or in practice.
Margaret Wachenfeld, CHRB independent director and co-lead of the CHRB Methodology Committee, said: “While we see clear progress from some companies, the majority are failing to make the grade. Seventy years after the adoption of the Universal Declaration of Human Rights, this is very concerning. If businesses will not clearly demonstrate their respect for human rights, then governments should step in with tougher laws to protect people.”
John Morrison, chief executive of the Institute of Human Rights and Business, added: “Forced and child labour, gender equality and protecting activists are some of the most pressing issues of our time. Companies need to show how they’re addressing these challenges, to protect themselves from legal penalties or action from investors and consumers.”
What the latest rankings suggest is that companies near the top have demonstrated an ability to identify and manage risks as “a key part of their core business”, but companies at the bottom “failed to show any engagement with human rights concerns”
“This should raise urgent questions for investors and consumers as to whether these companies are serious about avoiding harm to people in their pursuit of profits,” the research states.
Overall, the research has found poor engagement in three key areas:
- Virtually no companies demonstrate strong commitments to ensuring living wages are paid to workers in their own operations and supply chains.
- Less than 10 per cent of companies commit to respecting human rights defenders (HRDs), including those HRDs exercising their rights to freedom of expression, association, public assembly and protest.
- There is a clear gap between companies acknowledging allegations and actually engaging with those affected.
CHRB confirmed that Aviva, APG and Nordea will be using the 2018 benchmark to “inform their investment decisions”. This will potentially affect over $1trn (€887bn) of assets managed between them.
Steve Waygood, Aviva Investors chief responsible investment officer and CHRB chair, said: “This ranking should serve as a wake-up call for businesses everywhere. Too many are still not doing enough to respect the rights of those involved in or impacted by their operations, despite increasing investor scrutiny and the negative impact it has on a company’s long-term performance and prospects. While some businesses are showing the way forward, the overall picture is deeply concerning.”
Further details from the research are available here: https://www.corporatebenchmark.org/2018-assessment