How can companies balance shareholder profits with human rights?

1 The business case for human rights

Why should companies care about human rights? First of all, because they have a legal and ethical obligation to do so, as recognized by international standards such as the UN Guiding Principles on Business and Human Rights. Secondly, because respecting human rights can enhance a company's competitive advantage, by reducing risks, increasing trust, and creating value for stakeholders. For example, a company that ensures fair labor practices, safe working conditions, and non-discrimination can improve its productivity, retention, and innovation. A company that engages with local communities, respects their rights, and addresses their grievances can avoid conflicts, lawsuits, and protests. A company that supports human rights defenders, activists, and journalists can contribute to a more open and democratic society, where its operations can thrive.

2 The challenges of human rights

However, respecting human rights is not always easy or straightforward. Companies may face dilemmas, trade-offs, and conflicts of interest when dealing with different stakeholders, markets, and regulations. For example, a company may have to decide whether to operate in a country where human rights are violated, or to withdraw and lose market share. A company may have to balance the demands of its shareholders, who expect high returns, with the needs of its workers, customers, and suppliers, who expect fair treatment. A company may have to comply with local laws that contradict international norms, or to challenge them and face legal consequences.

3 The opportunities of human rights

Despite these challenges, companies can also find opportunities to advance human rights and create positive social impact. For example, a company can leverage its influence and resources to advocate for human rights reforms, support civil society organizations, and partner with other actors. A company can innovate and develop products and services that address human rights issues, such as access to health, education, and justice. A company can align its goals and values with those of its stakeholders, and create a culture of respect , diversity, and inclusion.

4 The tips for sustainability professionals

Sustainability professionals can help their companies balance shareholder profits with human rights by conducting a human rights impact assessment to identify and prioritize risks and opportunities, establishing a policy and governance structure that integrates human rights into core processes, engaging with stakeholders to understand perspectives, monitoring and reporting performance, and learning and improving from experience, feedback, and best practices. These steps will enable companies to build trust and dialogue, demonstrate progress and challenges, and seek continuous improvement and innovation for their human rights strategy.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?