Recap HUMAN 2015

Implementing human rights at Aviva Investors

Stephanie Maier (Head of Responsible Investment Strategy & Research at Aviva Investors):

“The importance of having a human rights perspective became apparent when Aviva had invested in Soco, a company that was seriously challenged when it started operating on a world heritage site and bribed government officials.

How can companies prepare themselves? Why do they find themselves in such situations? One key element is the lack of awareness of human rights, and what they could mean for them. There is a general lack of understanding. We’ve seen this many times in our engagement with other companies: what the impact is of a company in a particular region or country is often not comprehended. If you look at the example of Soco, why did they pay a corrupt officer at least 42,000 dollars? The company was just not aware, did not understand, how that would backlash at them.

I see an important role for investors in helping companies to truly understand human rights risks and issues. As long-term investors we see that for good returns on investment, we have to become aware of and deal with sustainability issues. It will frequently be the case that companies (and their shareholders) will benefit from not acting in a proper way in the short run, but in the long run they will not continue to do so. That is why a long-term perspective is so important.”

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Women’s rights are key

Selima Ahmad (Entrepreneur and Founder of the Bangladesh Women Chamber of Commerce)

Selima Ahmad is a self-made business entrepreneur from Bangladesh. She has built her company starting with $500,- into a multi-million dollar international corporation. To enable Bangladeshi women to empower themselves economically, she has established the Bangladesh Women Chamber of Commerce. For her, human rights and gender equality are closely aligned.

“We can strongly benefit from the implementation of human rights in business operations. We all make an impact both as individuals and corporations, the real question here is how we can deal with this impact.

The impact we can have is nowhere larger than on women. In Bangladesh, I have experienced in person how the unfair treatment of women versus men has hindered women in their attempts to get educated, to start a business and to become financially independent. Bangladesh is a country of microfinance. However, microfinance is too small to give women a ‘real income’, it is like charity. Also the repayment terms are often unrealistic. Women need real bank loans, real government support, real education.

Why are companies important to change this? We all know companies create jobs. But we also know that in countries such as Bangladesh, these companies are often corrupt. These companies comprise of people that come to developing countries to make profits. They want quick results. However, they should take the time to develop a human rights policy and to pressure governments to be more strict. As long as companies reward governments, and vice versa, for not upholding human rights, there are gaps in the protection of human and women’s rights. To close the gap, transparency is the first step. Paying taxes is part of this. If you don’t pay taxes and refuse to be transparent, then what is the difference between a company and a smuggler?

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Implementing human rights at Unilever

Marcela Manubens (Global VP for Social Impact at Unilever):

“I joined Unilever because I wanted to be part of a company that believes in working on human rights. Unilever has an incredibly big footprint, that is why we want to improve sustainable development while also striving to double the size of our business.

This is why we expanded our ambition and offered opportunities for women in particular, and worked on improving our human rights performance in particular. Unilever wants to have a positive social impact and is the first adopter of the UNGP Reporting Framework. For us, transparency is key. Because if we don’t report, we cannot prove that we are social engaged. Transparency is always the first step to improvement.

We need to take action when human rights are not respected. We need to think about the message to our employees. When we ask directors what human rights mean to them personally, stories of specific persons in dire conditions are told. When we talk about human rights, it is always about someone else, it is never about us. That is an attitude that needs to change: we want to make human rights personal. If you want change, you should start with yourself, you are the one who can make the change; but also remember: change doesn’t happen overnight. It takes time. Particularly in large companies – society often expect a big shift in only a short amount of time. We have to be ambitious but realistic at the same time.”

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Q&A:

Q: Are there issues with which Unilever deals to improve its human rights performance, that are actually hurting the business? In other words, does the response to the issue go against the business model?

A: Some may argue that the impact of our decision is disadvantageous for Unilever when looking at our financial Profit & Loss accounts, but that is looking only to short-term gains. For us, it does not pay to have people working in poor conditions. That goes against our sustainable business model.

Q: At the moment Unilever is praised by almost everyone. Are there still organisations that critise you? Who are your main critics?

A: Naming and Shaming is still okay, because is often has an impact: it starts the discussion, issues are recognized, business listens to civil society organisations. However, now we know we can do more, we need to work together instead of opposing each other. Where there is only criticism, there is no incentive for cooperation. We need the critical mass, but we also need people to ‘cross the streets’ and work with us in a constructive way.

Q: Do you promote human rights in difficult countries?

A: Yes, we do. And we will continue to do so. But it is difficult indeed, particularly concerning the role of business in an area of conflict. If we stay we have more leverage and impact to change the situation. If we divest we lose that possibility, but on the other hand we have a better security situation. It is a though question.

Human rights 1.0

Speaker: Liesbeth Unger (Human Rights@Work)

Human rights are standards for everybody. They are based on international standards and treaties between states. The UN Guiding Principles for Business and Human Rights describe what is expected from states and businesses regarding human rights:

  • Protect. States: duty to protect
  • Respect. Corporations: responsibility to respect
  • Remedy. Victims: access to effective remedy

The UNGP states that corporations have the responsibility to ‘do no harm’, independent of what the state does. This is a proactive responsibility rather than a reactive one. Three tips to improve your human rights performance:

  1. Start small and prioritise based on impact: take one country, one supply chain and investigate (impact assessment – what happens locally)
  2. Start asking questions (to suppliers, to human resources, to management, to stakeholders) and initiate a joint risk assessment
  3. Start the internal and external conversation about what human rights mean for the company

Additional tools/frameworks: UNGP Reporting Framework, Social Hotspot Database, CSR Risk Check.

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When a company faces more than one human rights risks, how should it prioritise action?
“As a company, you need to have resources to deal with all human rights risks; there is no option of prioritising based on your own interests. However, what you can prioritise on is the severity of the impact and the leverage that you have. Sometimes, you see that you could have a great impact, but you simply don’t have the leverage to achieve this. It is then key to find other stakeholders and address the issues together.”

Setting a long-term social ambition

Speakers: Marije Klomp and Shirly Justice (MVO Nederland)

If we look at business and human rights we usually see companies as part of the problem. How can we change that? How can companies be part of the solution instead of only part of the problem? MVO Nederland developed Ambition 2020 for this.

What makes a good ambition for 2020:

  1. Look at your impact: where does your company have the largest impact?
  2. Ask yourself critical questions: is your ambition high enough? Is it inspiring? Is it feasible and realistic?
  3. Be future oriented: formulate an ambition for the long run. Start in 2020, where would you want to be then?
  4. Formulate your ambition as concrete and measurable as possible. This is where your KPIs come in.
  5. Let yourself be inspired by the ambition of others.
  6. Make your ambition clear and understandable: ensure that the header of your ambition is immediately clear to the reader.

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Reporting on human rights

Speakers: David Vermijs (Shift) and Marcela Manubens (Unilever)

Though companies found the guiding principles useful they needed a reporting framework to transparently report against human rights targets. After the launch of the UNGP Reporting Framework earlier this year, it has been publicly used by companies to guide them with the implementation of the UNGP. Increasingly the Framework is creating momentum for human rights.

Reporting on UNGP enables companies to report on human rights in a meaningful way that meets stakeholder needs; fits seamlessly both with broader reporting frameworks and industry/issue-specific initiatives; is feasible for small and large companies.

Companies should focus on severity and salience. When you start reporting on issues: what are your salient issues? Define those and explain how you got to these? It is working as a risk management tool for companies. It can be really helpful guiding engagement and identify risks.

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Case example (Unilever)
Unilever is the first to publish a full human rights report in accordance with the UNGP Reporting Framework. Unilever wanted to expand its social ambition. “We knew we needed to address human rights and that we needed a holistic approach.”

  • “We are focusing so much on doing no wrong, but what does doing good look like?”
  • “If you don’t want child labour, what do you want?”
  • “Transparency is what can make us engage and move forward.”
  • “The process of the Reporting Framework is not easy, significant incentive and motivation are needed to make it a success.”