L?ning - Human Rights and Responsible Business Monthly Briefing
L?ning – Human Rights & Responsible Business GmbH
We are an international management consultancy specialised in human rights.
March 2023
Dear followers,
We are seeing more and more sunny, blue skies as Berlin slowly moves into spring and winter is on its way out. However, a 15°C sunny spring morning in Berlin can still turn into a snowy afternoon very abruptly. For me, as a Brazilian living in Berlin, this was a hard reality to accept.
My colleague Alice and I experienced very different weather last month in Paris, where we attended the OECD Forum on Due Diligence in the Garment and Footwear Sector. There, we learned that “impact” is the word of the moment. More than a decade after the adoption of the UN Guiding Principles on Business and Human Rights and five years after the adoption of the OECD Due Diligence Guidance for Responsible Business Conduct, there was much discussion about how to bring these principles to life. The message that resonated strongly at the OECD Forum was that there’s a need to focus on the impact that both sets of guidelines can have.
Before joining L?ning, I worked as a dispute resolution professional in Brazil and directly engaged with people adversely affected by business activity. During that time, I saw first-hand that positive impact cannot be achieved without an effective rightsholder-centred approach. And the first step is to listen to the rights-holders: companies must go beyond simply providing communication channels and embrace their responsibility to engage with affected communities.?
Effective engagement with rights-holders and communities requires participatory, non-patronising spaces; meaningful, accessible and transparent grievance mechanisms; and a dialogue-based and equitable approach to remediation. Just as one sunny morning doesn’t make a summer, effective human rights due diligence has many components – and proper grievance management is one of them.
If you want to be a company that truly has a positive impact on people and involves all relevant stakeholders in the process, please get in touch. I’d love to talk to you. Email me at?[email protected].
on behalf of Team L?ning?
Mariana Rezende?
The Latest from Team L?ning
At the latest?Ask the Experts Live Q&A Session?Shifting the Perspective: Worker-Centric Human Rights Due Diligence,?we discussed?how companies can swiftly adopt effective and meaningful grievance mechanisms.
Watch the webinar recording?here.
What does “appropriate” mean in the context of human rights due diligence? In this?new blog post, Team L?ning explains how companies can ensure that their due diligence processes are?“appropriate” as required by the German Supply Chain Law (LkSG).?
European Commission
Critical Raw Materials are indispensable for the EU economy and a wide range of necessary technologies for strategic sectors such as renewable energy, digital, space and defence. The European Commission has published its proposal for an EU Critical Raw Materials Act to ensure the EU’s access to secure and sustainable supplies of critical raw materials, enabling Europe to meet its 2030 climate and digital targets.?
European Parliament?
Green bonds can play a critical role in financing the transition to a low-carbon economy, helping to mobilise the capital needed to achieve ambitious sustainability goals. The green bond market has grown exponentially since 2007. The European Green Bonds Standard (EUGBS) will primarily enable investors to direct their investments towards more sustainable technologies. It is in line with the more horizontal taxonomy legislation that defines which economic activities can be considered environmentally sustainable.?
European Parliament
The European Parliament adopted a report on the implementation of the EU Guidelines on Human Rights Defenders. The adopted text?highlights the invaluable front-line work of EU delegations and member states’ missions in third. It urges member states to recommit to, and implement, human rights standards that recognise their responsibility to protect HRDs, and sets out the necessary political, legal and practical measures to ensure they are able to work free from hindrance and insecurity. It also believes that an HRD dimension has yet to be integrated into all EU external action in a systematic and consistent manner.?
Vietnam Briefing
New legislation requires EU member states to create laws addressing ESG issues in their global supply chains. Requirements include incorporating due diligence into their policies and identifying potential adverse impacts on human rights. Understanding how the proposed legislation could affect Vietnam is important both for EU companies doing business with Vietnam and for domestic producers involved in EU supply chains. Since the Europe-Vietnam Free Trade Agreement (EVFTA) entered into force, EU investors have registered more than US$26 billion for nearly 2,250 projects in Vietnam.
WirtschaftsWocheDue to possible human rights issues in China, Deka Investment Fund managers are no longer allowed to invest in Volkswagen for sustainable financial products. Deka Investment Fund is the central asset manager for DekaBank, the German Savings Bank Finance Group. Volkswagen is now also facing problems with refinancing. Volkswagen’s Head in China, Ralf?Brandst?tter,?visited Xinjiang?and argued that?there was no evidence of forced labour and that workers’ comments were in line with reports Volkswagen had received from SAIC about the plant. Following Ralf?Brandst?tter’s comments, the works council of Volkswagen Group said?in a statement?that the company must make clear the plant’s value for the business and take a stand on human rights violations in China.
EarthRights International
The US District Court in Florida has ordered banana company Chiquita Brands International to stand trial for illegally funding paramilitary death squads in Colombia, and is allowing the families of 17 victims to present their cases.?In the 1990s and early 2000s, Chiquita Brands International paid $1.7 million to the United Self-Defence Forces of Colombia (AUC), which in turn used violence against communities in Colombia’s banana-growing regions.?
20minuten
The Zurich District Court has found the manager of a plastering company guilty of commercial human trafficking, fraud, unfaithful business management, mismanagement and other offences. He was sentenced to ten years in prison. According to the court, the defendant had exploited workers from Hungary and Moldavia, who were in an economically vulnerable situation. The construction workers had been expected to work up to ten hours a day and were paid as little as 4 Swiss francs per hour.?
Radio Free Asia
The number of detainees in Xinjiang’s re-education camps is drastically dropping. But this does not signal an end to the repression. As two reports providing judicial statistics released by Chinese officials indicate, China’s strategy for constraining the Uyghur population is shifting from so-called “re-education camps” to prisons as hundreds of thousands of Uyghurs are now being sentenced to disproportionately long prison terms.
Bloomberg
UBS Group AG has agreed to buy financial giant Credit Suisse for some $3.25 billion in an all-share deal. For 166 years, Credit Suisse helped position Switzerland as a linchpin of international finance and went toe-to-toe with Wall Street titans before a steady drumbeat of scandals, legal issues and management upheaval undermined investor confidence. The decline was in the making when the bank was removed from the Dow Jones sustainability index in 2021 following risk, governance and sustainability scandals.
Washington Post
After years of pressure, Google has released a review of its products and policies for potential racial bias and discriminatory practices. WilmerHale, a law firm that has represented a number of industry heavyweights, conducted the assessment which highlights ongoing initiatives to address harassment, discrimination and online hate speech, while offering “opportunities for improvement”. The assessment details how the company’s diversity and inclusion policies and approach to content moderation affect marginalised communities, including at its subsidiary YouTube.
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While?AI tools store and process data to produce more tailored results, this poses risks for organisations: that information might be accessed by third parties, potential breaches of data protection laws and contractual obligations.?Organisations should therefore take care to ensure that personal data is not fed into AI tools.?As the providers of ChatGPT and other AI tools use data for their own purposes, such providers will almost certainly be deemed “controllers” or “third parties” under the EU GDPR and US state data protection laws.
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The New York Times?
Migrant children are arriving in the US in record numbers and ending up in dangerous jobs that violate child labour laws – including in factories that make products for well-known brands like Cheetos and Fruit of the Loom. Days after a New York Times investigation?revealed?the explosive growth of migrant child labour?in the United States, federal and?state enforcement agencies have begun cracking down on companies that employ children, and the Biden administration is under pressure to make broader changes to the way it deals with minors who arrive in the country without their parents.
Japan Times
Amid growing global scrutiny of human rights issues related to supply chains, prominent Japanese companies including Mitsubishi Electric, Toshiba, Yamaha and Kirin have signed up to a platform designed to address such concerns in Japan and overseas. The platform allows allegations of human rights abuses to be made against member companies through an online process. Prominent Japanese companies such as Uniqlo operator Fast Retailing have faced international scrutiny over their links to cotton sourced from Xinjiang, while Kirin has faced criticism over its business links with the Myanmar junta.
Bloomberg
Subaru has?revised its benefits policy in Japan to cover same-sex partners of employees.?The company’s actions?joined a growing list of companies working to promote equality in the absence of government action?regarding pro-equality policies and benefits to same-sex partners of their employees in Japan. More than 350 companies and organisations support reversing the same-sex marriage ban, according to Business for Marriage Equality, a campaign backed by three non-profits.?
Fair Planet
The latest case of forced labour in conditions akin to slavery has been discovered in Brazil, tarnishing the reputation of the wine industry. More than 200 people have been rescued from vineyards in the southern state of Rio Grande do Sul, denouncing the violent methods of repression used to maintain their captivity. Brazilian institutions have published a note calling on society to promote decent working conditions for all in order to end the practice of slave labour, which is often based on discrimination and vulnerability.
Der Standard
The meat industry in Austria has a high proportion of migrant and cross-border workers who face language barriers, intimidation and pressure to keep quiet about their low wages. Wages in the poultry industry are the lowest in the meat industry and could be linked to a lack of empathy, which may be a cause of animal cruelty on chicken farms. New wages for the poultry industry will be negotiated starting in March.
The Guardian
MPs in Uganda have passed a controversial anti-LGBTQ+ bill that would make homosexual acts punishable by death, drawing strong condemnation from LGBTQ+ rights campaigners. The bill is the latest in a series of setbacks for LGBTQ+ rights in Africa, where homosexuality is illegal in most countries.
Harvard Business Review?
The number of companies appointing a Chief Sustainability Officer (CSO) has grown rapidly in recent years. However, the responsibilities of the CSO are often not clear. It is critical for companies to ensure that the role is balanced across all three elements of ESG. The authors present a visual framework and eight distinct roles for CSOs. These include ensuring compliance, monitoring and reporting, managing stakeholder relationships, building organisational capabilities, driving cultural change and embedding sustainability into processes.
Financial Times
With continuing scrutiny from consumers, activists and the media — and growing interest from investors — companies are now under more pressure to meet obligations over responsible sourcing. The issue of worker exploitation and abuse is more than in the public eye than ever. But as illustrated in the various examples presented in this article, the current combination of forces — collaborative, regulatory, financial, technological and legal — may just be enough to start laying the foundations for global supply chains that benefit, rather than abuse or exploit, the people who work in them.
Foreign Policy
Some $139 billion flowed into ESG funds last year, funds that invest according to various environmental, social and governance criteria. It has been a booming global business in recent years – and a controversial one, at least in the US. Republicans have accused ESG funds of “woke capitalism” and of hurting companies for the sake of a political agenda. The GOP blames the collapse of Silicon Valley Bank on ESG policies, but there is no evidence that SVB’s sustainable investments contributed to its collapse. A NYT podcast provides more information on this topic:?What is E.S.G and why are Republicans so mad about it?
Responsible Mining Foundation (RMF)
The Extractive Commodity Trading Report (ECTR) 2023 is an evidence-based assessment of the due diligence and disclosure practices of a sample of companies in the oil and gas, metals and minerals sectors. The report shows that few systems extend to the critical stages of assessing supplier compliance and taking action to address non-compliance. This is the case for all three risk areas examined: human rights abuses, illicit financial flows and environmental damage.
Cocoa production has been identified as a major global driver of deforestation, but its precise contribution to deforestation dynamics in West Africa remains unclear. Over 55% of cocoa remains untraced, either sourced indirectly by large traders through local intermediaries, or exported by non-transparent traders who do not disclose information about their suppliers (32.4%). Farm traceability lags even further behind and is insufficient to meet the proposed EU due diligence legislation requirement for the geo-location of product origins.
The Global Commission on the Economics of Water
In a landmark report released on the eve of the UN Water Summit, experts led by Johan Rockstr?m, director of the Potsdam Institute for Climate Impact Research, have called on governments to stop subsidising water extraction and overuse. Water is at the core of the climate crisis and the global food crisis. Seven calls to action were made: to manage the global water cycle as a common good, ensure safe and adequate water for vulnerable groups, reduce subsidies, establish equitable water partnerships, take urgent action, reform governance and include water in trade agreements.
UN Women
Women remain underrepresented in the creation, use and regulation of technology, making them less likely to use digital services and enter tech-related careers, and more likely to face online harassment and violence. Gaps in digital access and skills need to be closed to ensure a safer, more sustainable and equitable future for all. Governments need to invest in evidence-based programmes and initiatives to address barriers to women’s digital access, such as affordability, online privacy, digital skills and literacy.?
The Economist
The Economist’s glass-ceiling index measures the role and influence of women in the workforce across the OECD club of mostly rich countries. Four Nordic countries – Sweden, Iceland, Finland and Norway – top the index as the best places for working women. Japan and South Korea, where women must still choose between a family and career, fill the bottom two places.
European Institute for Gender Equality
The Gender Equality Index is a tool for measuring the progress of gender equality in the EU, developed by the EIGE. It has tracked the slow progress since 2010 due to the lack of advances in decision-making. Gender norms around care, gender segregation in education and the labour market, and gender inequalities in pay, remain pertinent. The 2022 Index has a thematic focus on care in the COVID-19 pandemic, exploring the division of informal childcare, long-term care and housework between women and men.
World Bank Group
The World Bank Group’s “Women, Business and the Law 2023” is the ninth in a series of annual studies measuring the laws and regulations that affect women’s economic opportunity in 190 economies. The project presents eight indicators structured around women’s interactions with the law as they move through their lives and careers: mobility, workplace, pay, marriage, parenthood, entrepreneurship, assets and pension.?The study makes an important contribution to research and policy discussions about the state of women’s economic opportunities by presenting examples of change and highlighting the gaps still remaining.