In November 2018, GLOBAL CSR participated at the annual UN Forum on Business and Human Rights for the 7th year in a row. This year’s topic was on human rights due diligence in practice. GLOBAL CSR brought six companies with us, who presented pioneering work on documenting operational-level human rights due diligence. The six companies represented three different business relationships, and their mutual expectations of adequate documentation of human rights due diligence: Business association to member; investor to investee; and buyer to supplier. The total of seven snapshot sessions brought good practice examples on how to make the UNGPs operational, focussing on documenting human rights due diligence.
During the introductory snapshot, Sune Skadegaard Thorsen from GLOBAL CSR introduced the theme of the sessions, and presented on the growing need for, and present lack of, good practice examples of operational-level human rights impact assessments as the key documentation of human rights due diligence. As he introduced the speakers, he emphasised the importance of being able to document that companies identify where are at risk of causing or contributing to adverse impacts, can show what they do to prevent or mitigate such risks, systematically keep track of the effectiveness of their actions and are able to share the results of this work to both potentially impacted stakeholders and business relationships. Here, as a key point Mr. Thorsen emphasised that documentation has to show concrete operational-level implementation from site-specific impact assessments. Without these, companies are at risk of overlooking severe adverse impacts in their operations.
Following the introductory snapshot session, a representative from the Danish Restaurateurs Association’s initiative on responsible business conduct, REGA, CSR Adviser Lea Marie Juliussen, and a representative from a member-restaurant, Founder and Director, Kim Rahbek, of the international chain Sticks’n’Sushi presented. REGA is the first industry initiative in the world pledging members to implement the UNGPs and document such implementation. Ms. Juliussen and Mr. Rahbek discussed the benefits they have found from collaboration on developing tools for conducting and documenting human rights due diligence. Ms. Juliussen gave account for how the efforts to support members documenting human rights due diligence have led to an improvement of industry reputation, collaboration has also led to the identification of sector specific risks, where the industry association initiative can enable the sharing of good practices in handling specific impacts, and politically engage to improve legislative conditions preventing or mitigating identified common risks for human rights impacts.
Mr. Rahbek from Sticks’n’Sushi emphasised how systematising and documenting the management of adverse human rights impacts has enabled the company to document how well it already manages risks and to identify risks of impacts that were hitherto unattended. The process of systematising has led to easier management, more efficient follow-up and better overview of company efforts regarding responsible business conduct. When joining REGA, Sticks’n’Sushi initially had thought the company was already well ahead of the agenda on responsible business conduct; however, Mr. Rahbek was surprised to find that they still had several unidentified risks and that the documentation for proper management of those was sometimes inadequate, when compared to the requirements from the UNGPs. Collaboration with other companies has, in particular, supported the identification of sector specific risks, guidance on coming up with actions and appropriate indicators to measure effectiveness of such actions. This has led to improvement on respect for human rights for all collaborating companies.
In the following two snapshots, CFO Henrik Bonnerup from Polaris Private Equity A/S and Kayleigh Olander, Strategic Project Management Officer at a recently acquired portfolio company, Configit, an ICT company, presented on the companies’ experiences applying the UNGPs before and after acquisition.
Mr. Bonnerup brought to the Annual Forum the screening tool that Polaris applies before and after an acquisition, presenting how the UNGPs has enabled the processes from screening, through acquisition, to implementation in any new portfolio company. The screening tool focuses both on procedures and on risks of severe impacts. The reason for the twofold focus of the screening tool is that any potential investee reporting on risks may be more or less reliable, depending on the degree to which the company follows the management system introduced by the global minimum standard on business and human rights. Mr. Bonnerup explained how the screening tool can be used as reference tool for the Board of Directors following an acquisition and that Polaris, in addition, developed a guide for new portfolio companies to implement the UNGPs well before Polaris plan to exit the investment. The rationale for the equity investor is obvious; proper implementation of the standard before acquisition will lower risks of un-detected adverse impacts and proper implementation subsequently will increase the value before exiting. In addition, Polaris experiences that many co-investors, such as pension funds, are increasingly expecting proper due diligence as defined by the UNGPs.
Ms. Olander from Configit presented on the process of implementation following the acquisition from Polaris. Ms. Olander, with reference to the CEO and CFO of Configit, took charge of the first steps implementing the management system. During the first 100 days following the acquisition, Configit:
- Conducted the first operational level impact assessments at HQ in Copenhagen comprising both human rights, environmental and corruption risks assessments. The assessments will form part of enabling assessments to be performed at all subsidiaries and as basis for interactions with business relationships that will similarly be expected to meet the standard for responsible business conduct. This way Configit can document to its employees, its investor, to business relationships and not least potentially impacted stakeholders that an adequate due diligence process is being established.
- Had the Configit Board and executive management adopt a policy commitment in alignment with the UNGPs for the company.
- Developed a plan for the full implementation of the management system in Configit.
Ms. Olander, subsequently, experienced that the sales & marketing department of Configit displayed great interest in the work on responsible business conduct. Ms Olander explained that responsible business conduct is becoming mainstream in the B2B segment and that a company being able to demonstrate best practice in meeting the globally agreed standard in a pragmatic manner, does not only ensure adequate management of human dignity but also creates business opportunities.
During the two final snapshots, Senior CSR Consultant, Ms. Linda Jakobsen, from the Danish based packaging company Schur International A/S, and Ms. Tiina Pursula, SVAP Director of the supplier company, Stora Enso, presented on experiences with collaboration and documentation of human rights due diligence.
Ms. Jacobsen recently finalised the first re-assessment at the subsidiary Schur Pack Denmark A/S and are continually rolling out implementation of concrete operational human rights impact assessments across their operations. Further, they are beginning to engage with their suppliers to share expectations that they also implement the UNGPs; i.e. respect human rights. Ms. Jakobsen focused the presentation on the level of work expected to implement the UNGPs, the timeframe Schur finds is realistic to develop capacity and conduct regular operational-level impact assessments across all locations, and finally outlined the many benefits Schur experienced from proper documentation of assessments; both internally and when met with the variety of expectations from business relationships in the downstream value chain.
Finally, Ms. Pursula from Stora Enso gave an account of how general human rights assessments performed in 2014/15 had led to a range of recommendations that Stora Enso is progressing to meet. Ms. Pursula further gave an account for the standards that Stora Enso follows when sharing expectations on responsible business conduct throughout their upstream value chain and reflected on how the level of documentation provided by Schur was appropriate in relation to Stora Enso’s existing standards.
The UN Forum session gave rise to fruitful discussions, and especially the focus on documenting operational-level human rights due diligence provided a very relevant and interesting discussion on the importance and benefits of documenting human rights due diligence with regard to a variety of business relations. The presenting companies brought valuable insights to the forum, and shared good practice to inspire and support the scaling up of business respect for human rights.
More information can be retrieved by contacting the respective companies directly or by writing the organiser Mr. Sune Skadegaard Thorsen at sst@globalcsr.net.