Human rights are increasingly a key topic of corporate social responsibility (CSR), of particular importance to the mining sector. Two new developments in this space point to the increased operationalization of human rights standards applicable to business, in particular the United Nations Guiding Principles on Business and Human Rights (UNGP).
The Corporate Human Rights Benchmark (CHRB) (www.corporatebenchmark.rg) was developed in consultation with stakeholders from companies, governments and civil society organizations, as well as investors, academics and legal experts around the world. The goal was to create the first open and public benchmark of corporate human rights performance globally. Focusing on agricultural products, apparel, and extractives, the CHRB uses publicly available information to determine a total score based on a number of themes. While the results are meant to be a good indicator of positive human rights management, they are not an absolute measure of performance, given that the scores are based only on publicly available information. The UNGP are a key standard for CHRB.
Benchmarking measurements cover the following themes:
Governance and Policy Commitments (10% of overall score): This involves such things as policy commitments and board level accountability. Most companies scored points for having some level of policy commitments, but half the companies scored zero on board level accountability. Emerging practices include “respecting human rights defenders,” board discussions of human rights, and board incentives and performance management.
Embedding Respect and Human Rights Due Diligence (25% of score): Assesses the extent to which a company’s policy commitments are put into practice. Companies generally scored low across this theme. Emerging practices include incentives, monitoring and corrective actions, tracking and communicating.
Remedies and Grievance Mechanisms (15% of score): Focuses on the extent to which a company provides a remedy when addressing actual adverse impacts on human rights. Most companies have some level of complaint mechanism, but do not involve users in the design of mechanisms. Emerging practices include publicly available procedures and commitment to nonretaliation.
Performance – Company Human Rights Practices (20% of score): Assesses companies based on use of living wages, aligning purchasing decisions with human rights, disclosing their supply chain, and transparency and accountability. Risks highlighted are child labour, forced labour, interference with freedom of association, health and safety, water and sanitation, women’s rights, indigenous rights and working hours.
Performance – Responses to Serious Allegations (20% of score): Focuses only on response to serious allegations, not the legitimacy of allegations. Most companies had few serious allegations. Many companies responded publicly to allegations.
In 2017, a report card was released for 41 of the world’s largest extractives companies, including many Canadian companies. The average score was 29.4% out of a possible 100%. The highest scoring companies were scored at 60-69%.
The CHRB states that no company achieves top scores across the board and scores are generally low, reflecting the fact that most companies are in the early stages of implementing the UNGP. Overall, the CHRB concludes that many companies have public commitments to human rights, but lack follow through on implementation. In particular, engagement with communities and workers is often lacking.
The CHRB report is not meant to be a definitive measure of corporate human rights progress, but rather a useful indicator and relative benchmark of performance within an industry. While companies have begun to consider human rights and to implement policies, the CHRB findings for 2017 suggest there is much progress to be made on following through on these commitments. This now publicly available benchmarking is sure to be reviewed by financiers, investors, governments and other stakeholders. Understanding its approach as a guide to improved human rights performance therefore presents opportunities for Canadian miners to stand out from their peers in future reports.
Michael Torrance is a lawyer with Norton Rose Fulbright, Toronto.