A human rights impact assessment (HRIA) is a process for identifying, understanding, assessing and addressing the adverse effects of a business project or activities on the human rights enjoyment of impacted rights-holders such as workers and community members. HRIAs can take various shapes and be led by different stakeholders, but should share the ultimate goal of protecting human rights and improving accountability of businesses for their adverse impacts on human rights.
The UN Guiding Principles firmly establish the corporate responsibility to respect human rights as a standard of expected conduct. This includes the expectation that businesses implement due diligence to identify, avoid, mitigate and remediate the human rights impacts with which they are involved. HRIA can provide a process for businesses to understand and address such impacts. While the UN Guiding Principles do not necessarily require that businesses conduct “human rights impact assessments”, they indicate that a range of approaches may be appropriate for assessing human rights impacts. Examples of approaches that have been developed include “stand-alone” HRIA (i.e. assessments that focus exclusively on human rights), “integrated’ assessments” (e.g. integrating human rights into environmental, social and health impact assessments) and others (e.g. community-led, sector-wide, or in the area of trade and investment).+ Read more
According to the UN Guiding Principles, businesses should do the following when assessing their human rights impacts:
- Draw on internal and/or independent human rights expertise;
- Undertake meaningful consultation with potentially affected rights-holders and other relevant parties;
- Be gender-sensitive and pay particular attention to any human rights impacts on individuals from groups that may be at heightened risk of vulnerability or marginalisation;
- Assess impacts from the perspective of risk to people rather than risk to business; and
- Repeat its risk and impact identification and assessment at regular intervals (i.e. before entering into a new activity, prior to significant decisions about changes in activities, and periodically throughout the project-cycle). (UNGP 18 and Commentary).
Although HRIAs can be an important tool for addressing adverse human rights impacts, a poor HRIA may become little more than a tick box exercise with limited impact on the human rights of the most vulnerable or disadvantaged. Therefore, businesses should carefully select the most appropriate HRIA methodology to cater to the size and complexity of their operations.
A number of HRIA tools are available for different types of assessments. For example, the “Getting it Right” tool designed by Rights & Democracy is a methodology to conduct a community-based, participatory process to analyse the human rights impacts of private foreign investments. The Danish Institute for Human Rights has developed a HRIA Guidance and Toolbox to facilitate HRIAs of business projects and activities with a human rights-based approach that is consistent with the UNGPs. Another form of HRIA is a sector-wide impact assessment (SWIA), which goes beyond a particular project to cover a sector as a whole and address project level, cumulative level and sector level impacts holistically.
Human rights impact assessments relate to the following Sustainable Development Goals
12) Responsible Consumption and Production
What National Action Plans say on Human rights impact assessments
Action point 17
Advocate for strengthening the integration of sustainable development (including human rights) in free trade agreements
This point explains that free trade agreement negotiations at the EU-level have presented several objectives, including the maximization of transparency and impact assessments on sustainable development.
The NAP states that, within EU Council negotiations, the aim of Belgium is to insist on carrying out impact assessments on sustainable development in order to map the economic, social and environmental impact of potential trade agreements, both for the European Union and for the countries with which negotiations on a free trade agreement are under way.
- The Flemish government furthers that in addition to “sustainable impact assessments”, they will also urge the EU to engage with “human rights impact assessments”, and that such an impact assessment is made within each free trade negotiation.
- The region of Brussels will ensure that a HRIA has been carried out before any ratification of investment and trade agreements, and that any major negative impact on the respect, protection and promotion of human rights has not been detected in third-party countries.
Action point 15
Incorporate the principle of “due diligence” into the management of the company, also in the terms of human rights
The NAP briefly mentions that the integration of the “due diligence” obligation for companies (as covered by the EU directive 2014/95/EU) will ensure better business continuity, and optimize relationships with local communities and workers, through a clear commitment and ongoing dialogue about the impact of their activities.
Pillar 1: The State Duty to Protect Human Rights
Strand 3: Inclusion and Non-Discrimination
Action Point 3.2 (page 35-36): The Ministry of Social Development will:
Prepare, through the Division of Social Policy of the Under-Secretariat of Social Evaluation, a statistical report about the socio-economic situation of risk groups including migrants, youth, disabled people, women and indigenous peoples, based on the Socio-Economic Qualification (SEQ) including income generated by work, capital and pensions, contained in the Household Social Register, divided by territory (regional division). This has the purpose of having available information regarding vulnerable groups within certain territory.
Strand 8: Legislation, Policies and Incentives
Action Point 8.1. (page 49): The Ministry of Economy will support the legal provision committed in the Agenda for Productivity, Innovation and Growth seeking to create a legal framework for social business enterprises, by encouraging the incorporation of business and human rights criteria.
Action Point 8.2. (page 49): The Ministry of Energy will identify, promote and design the necessary mechanisms to implement the local development policy concerning energy projects. Among other things, the policy includes measures to support the assessment of impacts on the human rights of communities, and mechanisms to resolve the disputes that may arise between communities and business enterprises, within the context of the development of energy projects.
Strand 9: State Business Enterprises
Action Point 9.3 (page 50)
To strengthen coordination between the Ministries forming part of the Inter-Ministerial Working Group, amplify the impact of this Action Plan, and make known its progress, the Group will carry out the following actions: …
2. Encourage the adoption of policies, statements or codes of conduct by business enterprises and urge the implementation of mechanisms of due diligence.
Pillar 2: The Corporate Responsibility to Respect Human Rights
Strand 1: Contextual Issues: Preparation of Documents allowing Business Enterprises to Understand the Local Context and the Risks of Potential Negative Impacts on Human Rights
Action Point 1.3 (page 53): The National Health Institute will coordinate, with expert support, the preparation of a study about the impact of the pharmaceutical industry.
Strand 2: Promotion of Corporate Due Diligence in the Field of Human Rights
Action Point 2.2 (pages 55-56): The Ministry of Economy, Development and Tourism will:
- Hold a working group meeting at least once each semester with the Division of Social Economy and Associativity and the Division of Smaller Business Enterprises, with the purpose of identifying the impact of human rights in the management of businesses such as cooperatives and SMEs, and of incorporating the vision of human rights and business enterprises within this type of economic associations. Based on the activities of the working groups, sector guides will be developed to evaluate compliance with human rights issues, with special emphasis on the management of supply chains. …
- Support the Ministry of Energy in the development of a Guide about the impact of projects on local communities, seeing to the integration of business and human rights standards into the development of projects within communities and, particularly, containing best practices about due diligence in human rights-related issues. …
- Subscribe in 2017 to an agreement with a technical, specialised body to develop a system to diagnose and measure the impact of small and medium size enterprises on human rights, through a digital tool of public access.
Pillar 3: Access to Redress Mechanisms
Action Point 2.5 (page 62): Within the framework of the Local Development Policy of the Ministry of Energy, the following actions will be carried out: …
- Promotion of formal and permanent spaces for dialogue between business enterprises and communities, whereby potential impacts may become known and
the relevant measures may be taken. For smooth operation of these spaces for dialogue, the public sector will promote the availability of a record of advisors and facilitators to be used by communities, and a Symmetry Fund allowing to finance such advisors or facilitators.
- Action point 1.8 (p. 11):
“The national entities part of the Subsystem for Economic, Social, Cultural and Environment Rights (DESCA), and the competent territorial entities will provide the necessary information to the Observatory of the Council to the President for Human Rights, for the consolidation of socio-political documents, as useful for public and private enterprises to identify human rights risks in the operations zones, and manage actions for prevention and mitigation. The Observatory will provide such information, once compiled, to entities encouraging foreign investments in the country, as well as other institutions to which such information may be useful.”
- Action point 2.6 (p. 13):
“The Ministry of Environment, jointly with the National Authority for Environmental Permits, will strengthen the existence of respect for human rights requirements regarding the Environmental Impact Assessment of companies, and the Business Social Risk Management and Human Rights Plans.”
- Action point 4.11 (p. 15):
“The Ministry of the Interior will implement actions at the institutional level to identify the real issues in the prior-consultation process and its effect on human rights. It will also improve such practices allowing for the involvement of the affected population, protecting and respecting the rights of the native, afro-descendant and ethnic minority communities, according to the OIL agreements and the standards of the Inter-American Human Rights System.”
- Action point 5.3 (p. 16):
“Promote the implementation of the United Nations Guiding Principles and other international standards on business and human rights by the trades and the enterprises part thereof, so they may adopt human rights policies. Thus, during the first year of the execution of this Plan, the Council to the President for Human Rights will convene high level meetings with the trades to determine the inclusion goals in the multi-actor initiatives and human rights performance follow-up mechanisms. These actions must be coordinated with the entities of the Working Group, especially with the Ministry of Commerce, Industry and Tourism and in cooperation with the Post-Conflict Directorate.”
- Action point 5.4 (p. 16):
“The Council to the President for Human Rights and the Ministry of National Defense will encourage the implementation of the Voluntary Principles on Security and Human Rights. To that end, they will alternately engage in the areas where such issue is treated.”
- Action point 5.5 (p. 16):
“Develop a guide on the increasing human rights risks of the business activities in zones historically affected by the armed conflict. Thus, the Council to the President for Human Rights and the Post-Conflict Directorate will coordinate with the Comprehensive Conflict Prevention and Management System the development of such guide, which must be worked upon in a participatory manner with the enterprises and the civil society. According to the provided period to create the Comprehensive Conflict Prevention and Management System, this action must be carried out within the year following the coming into operation of such system.”
- Action point 5.6 (p. 17):
“The Ministry of Commerce, Industry and Tourism will promote the business efforts to adjust their policies to the OECD Guidelines for Multinational Enterprises, for which purposes it will assess, within six month from the execution of this Plan, its strategy to disseminate the Guidelines so as to make them widely known.”
- Action point 7.1 (p. 19):
“The Working Group, advised by the Expert Committee, will encourage discussion fora to determine the best ways for enterprises to establish easy-to-access, transparent and effective complaint and claims offices or mechanisms for prevention and mitigation and remedy of adverse human rights effects as may be caused by their activities.”
- Action point 7.7 (p. 20):
“The Working Group, advised by the Expert Commission, will encourage companies to have follow-up strategies in place to know about the progress and follow-up to the mitigation of adverse impacts caused by the development of business activities.”
- Action point 7.8 (p. 20):
“The Working Group, advised by the Expert Commission, will encourage business enterprises to assess their risks and impacts on people and the environment as a result of their operation.”
- Action point 8.1 (p. 20):
“The Ministry of Commerce, Industry and Tourism will design a differentiated incentive strategy for large, medium and small enterprises with the purpose of having them to implement human rights policies involving:
- Public commitment
- Due diligence procedure
- Result verification mechanism”
- Action point 8.3 (p. 20):
“The Ministry of Commerce, Industry and Tourism, jointly with the Council to the President for Human Rights will create a Human Rights business incentive to be provided every year and to value the advances the business enterprises might have in adopting the international standards on business and human rights in their operations. This incentive regulation will be developed by the Working Group within the year following this Plan’s launching.”
- Action point 8.4 (p. 21):
“The Council to the President for Human Rights will publicly disclose on its website the advances and good practices implemented by the enterprises in respect of the human rights implementation in the business field.”
- Action point 8.5 (p. 21):
“The Council to the President for Human Rights will coordinate an annual international event with the international community, where business enterprises with the largest progress might show and share their challenges and issues.”
- Action point 8.6 (p. 21):
“The Council to the President for Human Rights, jointly with the Ministry of Foreign Affairs and the Ministry of Commerce, Industry and Tourism, will facilitate international exchange among business enterprises for better practices in the implementation of human rights in the business activity.”
- Action point 9.2 (p. 22):
“The Ministry of Commerce, Industry and Tourism, jointly with the Council to the President for Human Rights will support the coordination of corporate human rights policies with the Corporate Social Responsibility institutional programs.”
- Action point 9.4 (p. 22):
“With the purposes of improving trust levels within enterprises, and follow up to such levels, the Ministry of Commerce, Industry and Tourism will lead and organize the performance of surveys on public trust in business. Such surveys will include questions to find out about the people’s perception of how business enterprises respect human rights and of the remediation mechanisms provided by them.”
Publication and dissemination of existing documents, education and awareness-raising [page 11]
- Assess the vehicles in place to provide businesses with information on human rights risks in countries or regions where they are planning to set up operations.
Coordinator: Ministry of Foreign Affairs
Deadline: 31 December 2020”
Trade in military equipment [page 19-20]
“Current state of play:
- Trade in military equipment is regulated beyond the framework of national legislation and at EU level, in particular by Council Common Position 2008/944/CFSP defining common rules governing control of exports of military technology and equipment. That Common Position defines eight binding criteria for assessment of applications to export military equipment, including the need to consider the risk of potential violations of human rights.
- Offer all necessary cooperation and assistance to the Parliamentary Subcommittee on Acquisitions of the Ministry of Defence, Trade in Military Equipment and Innovations of the Armed Forces of the Czech Republic so that regular assessments can be carried out of the human rights risks posed by export licences and by military equipment exports that have been made.
Coordinators: Ministry of Industry and Trade, Ministry of Foreign Affairs
Public procurement [page 23]
“… certain international standards, such as ISO 26000, contain criteria recommended for human rights risk assessments. …”
State aid, guarantees and subsidies [page 25]
“Current state of play:
- Aid applicants must submit a detailed environmental impact assessment for a selected export where CEB- and EGAP-backed projects have a larger-scale environmental and social impact.”
The Czech NAP contains a section on Due diligence [page 35-36] which is relevant to human rights impact assessments (see the analysis on Human rights due diligence)
Transparency [page 37-38]
“The Government of the Czech Republic recommends that businesses where the activities, products, services or business relationships are associated with risks of serious human rights violations formally provide information on how they are dealing with those risks, even in situations where the law does not require them to do so. The government recommends all companies reporting on human rights to take account of the Reporting Framework for the UN Guiding Principles on Business and Human Rights. Reporting should provide information of relevance without overwhelming the reader. The Government also recommends that large-scale projects with a potential major impact be publicly presented and consulted.”
Voluntary non-financial reporting [page 38]
“A business may publish periodic non-financial reports in numerous forms, either as part of the annual report or entirely separately. In any case, they should be posted online on the business’s website. The non-financial report should not be drawn up just for show, but should shed light on significant information relevant to an impact assessment of the business’s operations. On the other hand, it should remain brief and concentrate on matters of relevance. Parent companies should include information on the activities of their subsidiaries.”
The Danish NAP highlights human rights impacts, reporting on these impacts, and due diligence requirements across all chapters. However the NAP makes no explicit reference to a ‘human rights impact assessment’. This can be seen in the three examples highlighted below.
Appendix 1, GP 3c
Initiatives taken or planned as a dedicated measure to implement the UNGPs (after the UN ratification of the Guiding Principles) [page 27]
“The Trade Council in co-operation with the Danish Business Authority holds workshops in Responsible Supply Chain management, especially focusing on small and medium-sized enterprises and their local business partners (GP 3c). The courses are held on an annual basis. They will include practical guidance on how to demonstrate due diligence in business operations in regard to adverse impacts on human rights.”
Appendix 1, GP 7
State Duty to Protect [page 30]
“Because the risk of gross human rights abuses is heightened in conflict-affected areas, States should help ensure that business enterprises operating in those contexts are not involved with such abuses, including by: …
b) Providing adequate assistance to business enterprises to assess and address the heightened risks of abuses, paying special attention to both gender-based and sexual violence; …”
Appendix 1, GP 10
Status in Denmark (initiatives implemented before the UN ratification of the Guiding Principles) [page 32]
“Denmark has also been active in promoting that The International Finance Cooperation (IFC) actively supports its clients in addressing human rights risks and impacts.”
Government covering note on the UN Guiding Principles on Business and Human Rights National Action Plan
“The identification and management of human rights problems has been recognised as a challenge in companies operating at the international level. As a rule, Finnish companies deal responsibly with human rights issues and support their implementation. Despite this fact, the possibilities for a single company to identify human rights risks and rectify them are limited. This is why international co-operation, more efficient distribution of information, more effective enforcement of existing legislation and existing human rights conventions (e.g. ILO core conventions), transparency and the proper promotion of regulation for various actors should be emphasised in the promotion of human rights. The Team Finland network should also be more effectively developed to assist companies in understanding, taking notice of and managing human rights issues, particularly in areas where human rights risks are considerably high. The work of NGOs should be supported in accordance with the action plan drafted by the working group.”
Ownership policy and social responsibility
“Companies with a controlling interest held by the State assess the human rights risks of their own operations and those of their subcontractor chains, reporting on them and their own tax procedures.”
1 The state obligation to protect human rights
1.3 Activities in the EU [page 18-22]
“As a follow-up measure, the working group suggests that in order to reinforce the human rights aspect in the EU trade policy:
- Finland will support the strengthening of human rights assessments in third countries during EU trade or investment agreement negotiations and when monitoring their implementation. Finland shall make use of the human rights assessments in forming its own opinions related to trade policy positions. Finland supports that human rights will be taken in to account in the EU investment agreements or in potential new bilateral agreements made by Finland.”
PUBLIC FINANCIAL INSTITUTIONS AND FINANCIAL INSTRUMENTS RELATED TO DEVELOPMENT COOPERATION
“Finland’s official export guarantee company, Finnvera, uses policies updated on 1 January 2013 for evaluating the environmental and social effects of projects. When granting export credit guarantees and confirming export credit guarantee conditions, the environmental and social impacts of the project in question are taken into consideration as part of the project’s total risk assessment. The development of Finnvera’s environmental and social impact assessment is continuing in accordance with the OECD Common Approaches agreement. As with other public export credit companies, Finnvera also reports on its progress at the expert meetings related to the OECD agreement.”
3 Expectations towards companies and support services [page 24]
“The Finnish state is committed to promoting the OECD Guidelines for Multinational Enterprises. Although following the guidelines is voluntary for companies, the Finnish government expects companies to observe them. Companies’ obligation to respect human rights includes various actions to proactively mitigate the risk of human rights violations. This may be done for instance by including a human rights assessment in the company’s risk management system or by carrying out various special measures.
A careful human rights risk assessment and careful prevention has favourable long-term effects on the company’s own business activities.”
3.1 Clarification of due diligence [page 25]
“If the company has a lot of suppliers, it should identify the areas where the risk of adverse impacts is highest and contribute to the prevention of these risks.”
3.5 Support for Finnish and international organisations promoting the subject [page 28]
“Defenders of human rights, trade unions and other civil society operators can play an important role in the assessment of the impact of business activities on human rights, the availability of legal remedies and national and international discussion.”
I- The State’s Obligation to Protect Human Rights
The European Framework
6. The Council of Europe [page 17]
The political declaration supporting the UN Guiding Principles was adopted in April 2014 and the Recommendation CM/Rec(2016)3 on human rights and business was adopted by the Committee of Ministers of the Council of Europe on 2 March 2016.
Currently this recommendation includes the following provisions:
Article 20. Member States should apply such measures as may be necessary to encourage or, where appropriate, require that:
- business enterprises domiciled within their jurisdiction apply human rights due diligence throughout their operations;
- business enterprises conducting substantial activities within their jurisdiction carry out human rights due diligence in respect of such activities; including project-specific human rights impact assessments, as appropriate to the size of the business enterprise and the nature and context of the operation.”
8. Trade and Investment Agreements [page 19]
In 2013, France issued a number of proposals to improve the way in which social and environmental standards were addressed in European trade agreements. These proposals are still relevant.
These proposals focus on five main areas:
2. Improving the evaluation of sustainable development chapters through rigorous impact assessments. These impact assessments must provide a clear overview of social and environmental standards in countries negotiating agreements with the EU. France has completed a major revision of the European manual used to write these impact assessments. This could lead to progress in the field.
Actions to be Implemented
- Encourage impact assessments to be completed before and after agreements are concluded and make all free trade agreements conditional on the inclusion of human rights clauses and the prioritization of the UN Guiding Principles.
The National Framework
13. The Role of Public Agencies
The Agence Française de Développement (AFD)
… the AFD adopted a 2014-2016 CSR action plan developed with internal and external stakeholders. The goals of this action plan are to increase transparency
by consulting with relevant parties and by publishing information on AFD-funded projects and final reports. Other information is available upon request, including social and environmental impact assessments …
II- Businesses’ Responsibility to Respect Human Rights
3. Risk Analysis and Impact Assessment [page 40]
Businesses must understand the type and scope of adverse human rights impacts (both real and potential) caused directly or indirectly by their operations, particularly in their business relationships. This enables them to identify measures to prevent, remedy and mitigate these impacts.
Practically speaking, businesses analyse their human rights risks by:
- Using external risk analysis tools (see below), which may or may not be adaptable;
- Identifying human rights issues that are specific to their operations or sector;
- Carrying out country risk assessments by compiling the available external data;
- Carrying out background checks and audits on suppliers and other stakeholders.
Many tools are available to help businesses analyse risks and assess the impact of their operations. If necessary, they can also call on employers’ organizations and other appropriate stakeholders.
The following points are key to the implementation of risk management measures:
- Impact assessments must be completed for new operations, projects, commercial relationships, countries, etc.;
Actions to be Implemented [page 41]
- Promote the completion and publication of voluntary impact assessments, ensuring that all appropriate stakeholders are included (if necessary, through the free, prior and informed consultation of populations), particularly rights holders for companies that are not required to complete project-specific impact assessments, and ensure these assessments are monitored.
Practical Tools Addressing Specific Issues:
- The Business and Human Rights Resource Centre (www.businesshumanrights.org) is an online library with connections to a wide range of working
documents and conceptual tools published by businesses, NGOs, governments, sector-specific initiatives and institutions. Many tools have been sorted by issue, country, sector or company policy/steps (policy, impact assessment, training, reporting, etc.).
There is no mention of human rights impact assessments in the Business and Human Rights Chapter of the Georgian Human Rights NAP.
1. Introduction [page 3]
“The legal system of the Federal Republic of Germany contains numerous instruments that are focused primarily on the protection of human rights. They are binding on all enterprises. Where the business operations of an enterprise have an international dimension, procedures for identifying any actual or potential adverse impact on the human rights of people affected by its business activity should be developed and implemented.”
III. Federal Government expectations regarding corporate due diligence in respecting human rights
Procedure for the identification of actual and potential adverse impacts on human rights [page 9-10]
“Central to the exercise of due diligence is the establishment of a procedure that serves to identify, to prevent or to mitigate potentially adverse effects of corporate activity on human rights. It is not – or not only – a matter of considering risks to the company’s own business activity but is primarily about risks to the human rights of those who may be affected by corporate activity, such as employees of the enterprise itself or of other companies in the supply chain, local populations and customers.
The consideration of potentially adverse impacts on human rights is a continuous task that accompanies work processes and, in particular, is performed with a sectoral focus. It should take place when new divisions, products or projects are launched as well as in the context of existing business activities. When potential risks are examined, a distinction must be made between the following types of impact:
- those generated directly by the enterprise itself,
- those to which the enterprise contributes, for example through direct contractual relations with suppliers, and
- those connected indirectly with the enterprise through its business relations, its business activity or its products or services even though no direct contractual relationship exists, for example in situations involving numerous intermediary dealers. Granting loans, issuing credit lines and providing other financial services to other banks, insurers or other financial service providers do not in themselves constitute a relationship in the above sense if those transactions cannot be unambiguously attributed to a particular business activity in the real economy.
This systematic approach to identifying key impact factors and risks is nothing new and is already part of established management systems and processes, as may be seen, for instance, in Annex I to Regulation (EC) No 1221/2009 on the voluntary participation by organisations in a Community eco-management and audit scheme (EMAS), which deals with the internal environmental review to be conducted by participating organisations.
The size of an enterprise, the sector to which it belongs and the nature of its business activity directly influence the risk that its operations will have an impact on human rights. The required depth and breadth of the risk assessment depends on these factors. An initial risk analysis on the part of an enterprise should be conducted for each division or each product category and possibly for each location too. The starting point may be a simple overview of the company’s main activities and of the value chains and business relations these activities entail. On the basis of this overview and with due regard to the international human rights standards enshrined in instruments such as the Universal Declaration of Human Rights, the International Covenants on Human Rights, the ILO Core Labour Standards and the OECD Guidelines for Multinational Enterprises, potential risk areas can be identified. Contextual circumstances such as the political framework and the presence of vulnerable groups of people (indigenous populations, for instance) should be factored into the analysis. The choice of method and the assessment of risks can be made on the basis of the analysts’ own research, interviews in-house, in subsidiary enterprises and/or with business partners and input from external specialists.
With the aid of this analysis, enterprises should determine whether an in-depth review is needed. This is most likely to be the case if the risk of an adverse impact on the human rights of particular groups is particularly high and fuller information is required before any action can be taken. For this reason, the recognised problem areas should be ranked in order of priority.
The risk of a particularly adverse impact arises, for example, in cases where a large number of people may be affected or the potential impact would have serious, unforeseeable, or irreversible consequences. The in-depth review should at least include local dialogue with actually or potentially affected parties and recourse to both internal and external expertise in the field of human rights.”
1.1 Basic rules of economic policy
Bi- and multilateral economic relations [page 17-18]
“it is important that trade should be shaped in a development-friendly way. This means, for example, that environmental, social and human rights standards should firmly underpin free-trade agreements, which should be accompanied by impact-assessment and monitoring mechanisms.”
The current situation
“The Federal Government supports further development of the range of instruments for human rights impact assessment of trade and investment agreements.”
- “The Federal Government advocates and supports further development of the range of instruments for human rights impact assessments of the EU’s trade and investment agreements. Moreover, comprehensive impact assessments should be conducted before negotiations begin, so as to guarantee that the findings of the assessments can influence the negotiations.”
1.3 State support
Export credits, investment guarantees and other instruments for the promotion of external trade page 24-25
The current situation
“The processing of export credit guarantees, DIA guarantees and untied loan guarantees is undertaken on behalf of the Federal Government by the mandated companies Euler Hermes and PwC. Respect for human rights is already an element in the assessment of applications. Where there is reason to do so, environmental and social aspects as well as human rights considerations are closely examined.
How closely depends on the potential impact of the project. The minimum requirement for the assumption of a guarantee is compliance with the national standards of the target country. Projects with a considerable impact on human rights are subjected to a more thorough examination.”
“The Federal Government will ensure that human rights, which have hitherto been an element of the environmental and social impact assessment, are given more specific consideration and a higher profile in assessment procedures. It will measure the existing assessment procedures against the requirements set out in chapter III above and make adjustments where necessary. One particular priority will be measures for better identification of risks to human rights as part of the assessment process.”
Section 3: Actions
II. Initial priorities for the Business and Human Rights Implementation Group [page 18]
“ix. Encourage companies and NGOs funded by the State to carry out human rights due diligence as appropriate to their size, the nature and context of operations and the severity of the risk of adverse human rights impacts.”
Annex 1 – List of additional and ongoing actions to be carried out across Government
EU and Multilateral Efforts [page 20]
“7. Continue to take account of the human rights elements of European Commission impact assessments when providing input in the course of Free Trade Agreement (FTA) negotiations and support the appropriate implementation of human rights clauses in FTAs as they arise in EU Agreements.”
The Italian NAP does make an explicit reference to HRIA.
The Lithuanian NAP makes reference to impact assessments, but only in the context of impact assessments conducted by the state on regulatory proposals.
Objective 1: ensuring State’s duty to protect, defend and respect human rights
A. Legislative measures [page 2]
1. “Improvement of the legislative process … Law on Legislative Framework of the Republic of Lithuania was adopted on 18 September 2012, and came into force on 1 January 2014. Following the principles of openness and transparency, it provides for law-making to be made public, as general interest-related legislative decisions cannot be made without public awareness and without the possibilities to participate; the public must have access to information related to the national policy objectives, the need for legal regulation and participating bodies; the civil society and interest groups must be provided with a possibility to submit proposals for legal regulation at all the stages of law-making. It also provides for the right to know the bodies that were involved in submitting, drafting and assessing regulatory impact of a respective legislative proposal, and the bodies monitoring legal regulation.”
Part III – NAP
3. Government’s Response (pg. 28)
…Regarding companies’ level of commitment, it is interesting to take note of a study on corporate social responsibility that the international consulting firm KPMG published in 2017. For the first time this study also analyzed the extent to which human rights were perceived as a business issue in the 4,900 largest companies in 49 different countries (including Luxembourg) and in 250 largest companies in the world. According to the study’s statistics, Luxembourg is among the countries in which companies produce reports on their social responsibility at a lower rate than the world average. While this average is 72 per cent, in Luxembourg only 59 per cent of companies submit CSR reports. It can be concluded that, in Luxembourg, human rights are still perceived as not important to business. Therefore, if the Guiding Principles are to be implemented in Luxembourg and if companies must implement relevant domestic policies and rules on respect for human rights, as well as effective governance to implement them and means to address potential negative human rights impacts of their activities, then an effort of information, promotion and awareness on the part of the government, in the context of the NAP, seems useful and necessary.
3.1 An active role for the government [page 14]
“As the government pointed out in its policy letter ‘CSR Pays Off’ and as is discussed under point 3 below on due diligence, the challenge in the next few years will be timely identification of risks in Dutch companies’ supply chains. The government wants to work on structural solutions within international chains, not incident management.”
3.2 Policy coherence
Sustainable procurement policy [page 17-18]
“Under the social conditions of national sustainable procurement policy, companies supplying the government with goods and services are required to respect human rights. These social conditions have been included in all central government EU contract award procedures since 1 January 2013, and the municipal, provincial and water authorities are being encouraged to apply them, too. Suppliers can fulfil these conditions in various ways – by joining a reliable multi-stakeholder supply chain initiative (quality mark or certification institute) or, if they have any doubts, carrying out a risk analysis. …
Government suppliers should perform a risk analysis to show that they respect human rights in accordance with the UN Guiding Principles.”
3.3 Clarifying due diligence [page 21-28]
“Due diligence is a core concept of the UN Guiding Principles, as set out by Professor Ruggie. It may be defined as follows:
- Identifying and assessing human rights impacts: taking proactive, ongoing steps to understand how existing and proposed activities may cause or contribute to human rights impacts.
- Taking action and tracking effectiveness of response.
- Externally communicating how the business has addressed adverse impacts: it is possible that these impacts are not the direct result of a business’s own operations, but are caused elsewhere within the supply chain.
- Due diligence is not a one-off activity but an ongoing process.”
Raising companies’ awareness
“The government supports the SER [Social and Economic Council] with a grant for workshops to help companies shape the human rights component of their CSR policies, and to assist them in charting and prioritising the risks they face. … The SER has also been given a grant to investigate whether the ISO 31000 risk management standard is applicable to CSR due diligence.”
CSR Risk Check
“Using a grant from the Minister for Foreign Trade and Development Cooperation, CSR Netherlands has developed the CSR Risk Check for companies wishing to apply due diligence. Based on the sector and country in which a company is operating, this internet tool provides an indication of possible social impacts. CSR Netherlands works with the agency responsible for carrying out Sector Risk Analyses to harmonise the information on which the two instruments are based. This information will be used in the course of 2014 to compile sectoral world maps on which colour coding will be used to indicate whether a certain theme (e.g. child labour, discrimination of women) plays a role in a given country or region.”
Sector Risk Analysis
“An issue raised during the consultations was that the government should help companies to take a proactive approach in identifying risks to human rights.
As announced in the CSR policy letter, Sector Risk Analysis has been introduced to identify the sectors that present the greatest risk of adverse social impacts and where priority should be given to strengthening company policy in relation to them. This forms part of the Dutch government’s due diligence towards the business community. In this way, it is helping the business community to fulfil its responsibility to apply due diligence on CSR. Both the business community and civil society organisations will be closely involved in the analysis. The government will enter into dialogue with the sectors identified in the analysis to explore how the situation can be improved. Human rights issues may also be raised. The government will report to the House of Representatives on progress with the project in early 2014.
Where specific issues relating to human rights and the Dutch business community play a role, the government will enter into dialogue with the companies concerned.”
Due diligence by government
“For some time now the government has applied ICSR [International Corporate Social Responsibility] frameworks for risk assessment (due diligence) to all applications for support. These frameworks differ, depending on the goals and the nature of the instrument in question. For example, the ICSR framework for trade missions differs from the frameworks for project grants or export credit insurance. Assessment is based on the risk profile of the project or instrument, so that high-risk projects are subject to more thorough assessment than projects with fewer risks.
Companies should always take responsibility for their activities and the ICSR assessment frameworks provide guidance in this respect.”
ICSR in relation to export credit insurance
“The OECD Export Credit Group, in which all member states with export credit facilities are represented, is working on a strategy for assessing project-related human rights. The Netherlands plays an active part in this group, which is responsible for improving risk assessment.”
3.2 Responsible business conduct
Integrating And Managing The Finding From Due Diligence Process And Risk Analyses [page 34]:
The 19th principle concerns how companies should follow up the findings of the impact assessments: 19. In order to prevent and mitigate adverse human rights impacts, business enterprises should integrate the findings from their impact assessments across relevant internal functions and processes, and take appropriate action.
The Polish NAP makes no direct or explicit reference to human rights impact assessments.
The Slovenian NAP makes no reference to human rights impact assessments.
South Korea’s NAP makes no reference to human rights impact assessments.
Guiding Principle 2
“The Government will establish networks among Spanish companies or that the ones that operate in Spain for the promotion of: measures, procedures or internal systems that can effectively contribute to the prevention and/or mitigation of the negative consequences of business activities on human rights; as well as for the dissemination of good practices aimed to avoid these consequences, or to influence their avoidance, reduction or remedy. The establishment of procedures for internal assessment and determination of action will be promoted in a manner that avoids other negative consequences on human rights.”
“The Monitoring Commission will design and submit to the Government the adoption of an incentive system that includes both large companies and Small and Medium Enterprises (SMEs) that carry out policies in the field of human rights. These incentives may be economic, commercial, visibility and image, or other nature, to encourage companies to have policies and reliably certify that they have implemented adequate procedures at a global level according to their size and circumstances, namely:
- A public commitment to assume its responsibility to respect human rights in accordance with the provisions of the Principle no. 16;
- A process of due diligence aligned with the sectorial guides regarding the OECD (due diligence guidance), and based on the dialogue with stakeholders that allows identification, prevention, mitigation, and accountability of how they address the impact of their own activities and those that are directly related to their business relationships in accordance with the provisions of Principles no. 17 to no. 21;
- Some processes that allow to remedy all the negative consequences on human rights that have caused or contributed to provoke according to what is established in Principles no. 22, no.29, no. 30, no. 31.”
Guiding Principle 3
“In order to increase transparency, and the confidence of consumers and investors on Spanish companies, the Government will compile the reports that companies write voluntarily, in accordance with the Spanish Strategy for Corporate Social Responsibility, and the Article 39 of the Sustainable Economy Law. It will be encouraged that these take into account the impact of their activities on human rights, including the value chain, introducing a specific chapter for that purpose. Likewise, and in relation to the reports and reports mentioned in the article 35 2 a) of the Sustainable Economy Law, which binds state business corporations, and public business entities attached to the General State Administration, it will be promoted the inclusion of a section on human rights. In addition, the transposition of Directive 2014/95 / EU on disclosure of non-financial information and information about diversity by certain large companies and certain groups will be carried out.”
Annex: Measures taken [page 22]
The State as actor
- “Sweden is carrying out awareness-raising activities on this issue and supports the OECD’s work on how companies are to identify risks in the supply chain and avoid trade in conflict minerals (OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas).”
Annex: Measures taken [page 24]
Action by government agencies
- “In its ‘Common Approaches’ recommendations, the OECD prescribes a method that the EKN (and its equivalents in other OECD countries) should follow when assessing the environmental and human rights impacts of projects in particularly sensitive sectors to which it guarantees deliveries by Swedish companies.”
Annex: Measures planned [page 29]
The State as owner
- “The Government will work to increase knowledge about the UN Guiding Principles on Business and Human Rights in state-owned companies and will ensure that these companies, where appropriate, conduct human rights due diligence in order to assess and address any significant risk to human rights.”
5. National Action Plan on Business and Human Right
5.7 Pillar 1: state duty to protect
5.7.5 Policy coherence
Guiding Principle 9 [page 31]
PI33 regarding Consistency between free trade agreements and protection for human rights
The Federal Council continues to keep a close eye on international developments in human rights due diligence (referred to as impact assessments).
The UK 2013 NAP in the section on The existing UK legal and policy framework states [page 9]:
“The Government exercises controls on the export of “strategic” goods and technology through the export licensing system. All export licence applications are rigorously assessed against the Consolidated EU and National Arms Export Licensing Criteria. These assessments take full account of possible human rights impacts; a licence would not be granted if we judge there is a clear risk that the proposed export might be used for internal repression.”
The UK 2016 Updated NAP notes in The existing UK legal and policy framework that [page 6]:
“The UNGPs set out the general regulatory and policy measures a state may take in order to fulfil their duty to protect against human rights violations by third parties, including business enterprises. They recommend that states should:
- Encourage, or require, business enterprises to communicate their work to address human rights impacts;”
The UK 2016 Updated NAP further notes in The existing UK legal and policy framework that [page 8]:
“The Government exercises controls on the export of “strategic” goods and technology through the export licensing system. All export licence applications are rigorously assessed against the Consolidated EU and National Arms Export Licensing Criteria. These assessments take full account of possible human rights impacts; a licence would not be granted if we judge there is a clear risk that the proposed export might be used for internal repression.”
The UK 2016 Updated NAP, in the section devoted to The state’s duty to protect human rights: The existing UK legal and policy framework mentions the impact assessment with regards to controls on the export highlights that [page 8]:
“The Government exercises controls on the export of “strategic” goods and technology through the export licensing system. All export license applications are rigorously assessed against the Consolidated EU and National Arms Export Licensing Criteria. These assessments take full account of possible human rights impacts; a license would not be granted if we judge there is a clear risk that the proposed export might be used for internal repression.”
The UK 2016 Updated NAP makes a reference to impact assessment in Government Commitments section while discussing UNGPs Reporting Framework and Unilever human rights report [page 17]:
“The Commission is working in partnership with the Financial Reporting Council and Shift to publish guidance early in 2016 to help company boards to understand what they are expected to know, do and say about human rights. It will provide company boards with smart questions to ask of the business, help them to understand how human rights risks align with business risk, and bring clarity and coherence to different human rights reporting requirements. The Commission is working with the Institute of Human Rights and Business to publish guidance in early 2016 for UK businesses in the care and private security sectors. The guidance will include an assessment of the main human rights impacts in each sector and practical guidance for managers in areas such as human resources, operational delivery and procurement.”
Facilitating RBC By Companies [page 17]
“… The U.S. government generates and vets relevant information that can be used to conduct appropriate due diligence and risk assessment. While the concept of due diligence is increasingly well understood and accepted among businesses, the tools and resources available to effectively conduct detailed and appropriate risk and impact assessments can be sparse, particularly in many of the complex environments where this type of data is most needed.
To help address those gaps, the U.S. government deploys significant resources to produce and disseminate a variety of reports that help describe the state of human rights, labor rights, commercial, and investment conditions across the world, and produces international company profiles to provide U.S. companies with information to help them vet potential business partners. In certain instances, the government also funds third-party reports that contain information useful to those seeking to promote and implement RBC. As part of the ongoing effort to facilitate RBC, the U.S. government will continue to enhance these resources, making them increasingly user-friendly and easier to find for the purposes of corporate human rights due diligence and social impact assessment.”