The Strategic Edge: The Case for Your Business and a Fractional Human Rights Advisor

The pressure to uphold high ethical standards has never been greater. As corporations navigate a rapidly evolving, even turbulent, landscape of legislation and societal expectations, the role of human rights within business practices is becoming increasingly crucial. It has been going this way since the Sullivan Principles in 1977, but now the impetus has grown from a bike path to a highway. Yet, many companies find themselves unprepared or ill-equipped to manage these challenges comprehensively. Enter the fractional or ad interim Human Rights Advisor—a strategic solution that offers expertise without the full-time commitment.

The Rising Tide of Human Rights Legislation

Global and national legislation is driving businesses toward greater corporate human rights due diligence. In Europe, the European Union's Directive on Corporate Sustainability Due Diligence (CSDDD)n requires companies to identify and address human rights and environmental impacts across their operations and supply chains. The UK Modern Slavery Act mandates businesses to report on measures taken to prevent modern slavery in their supply chains. Additionally, the United States has the Uyghur Forced Labour Prevention Act, and the EU now has the Forced Labour Regulation, which prohibit imports of goods produced through forced labour (in Xinjiang, in the US case). These laws, among others, signal a clear trend: compliance with human rights standards is no longer optional but a legal obligation and one that has evolved from voluntary measures, to soft law, and now to hard law. Times have changed and if your business is not yet ready on human rights, you are well behind the curve.

Beyond Compliance: Ethical and Strategic Benefits

1. Reputation Management: A company’s reputation is one of its most valuable assets. Engaging a human rights advisor, even on a part-time basis, demonstrates a commitment to ethical practices, enhancing corporate image and stakeholder trust.
2. Risk Mitigation: Human rights violations can lead to significant legal and financial repercussions. A human rights advisor helps identify and mitigate potential risks before they escalate, protecting the company from lawsuits and financial penalties.
3. Market Differentiation: In an era where consumers and investors are increasingly driven by values, companies that proactively address human rights issues can distinguish themselves from competitors. This proactive stance can attract ethically-minded customers and investors, contributing to long-term business success.
4. Employee Engagement: A commitment to human rights fosters a positive workplace culture, enhancing employee morale and retention. Workers are more likely to be engaged and productive in an environment that prioritises ethical practices.

The Pragmatic Approach: Fractional Engagement

Many businesses hesitate to hire a full-time human rights advisor due to perceived costs and the uncertainty of the role's scope. This is where a fractional or part-time human rights advisor offers a compelling alternative.

1. Cost Efficiency: Hiring a full-time advisor can be expensive. A fractional advisor provides the same expertise at a fraction of the cost, aligning with budget constraints while still meeting regulatory requirements.
2. Flexibility: Business needs fluctuate. A fractional advisor offers the flexibility to scale up or down based on demand. For instance, if a company needs additional support during a specific project or audit, it can easily increase the advisor’s hours temporarily.
3. Reduced Administrative Burden: Contracting a human rights advisor as opposed to employing one full-time reduces the administrative workload related to payroll, benefits, and other HR responsibilities. This streamlined approach allows businesses to focus on core activities while ensuring compliance and ethical standards.
4. Access to Specialised Expertise: Fractional advisors often have extensive experience across various industries and regions. This breadth of knowledge can be invaluable, providing businesses with insights and strategies tailored to their specific needs and contexts.

Making the Business Case

The advantages of engaging a human rights advisor on a retained or fractional basis extend beyond compliance. Consider the following strategic benefits:

1. Training and Capacity Building: A fractional advisor can deliver targeted training sessions, helping to build internal capacity and awareness of human rights issues within the organisation. This ensures that all employees understand their roles and responsibilities in upholding ethical standards.
2. Stakeholder Engagement: Effective human rights management often involves engaging with a range of stakeholders, including suppliers, customers, and local communities. A human rights advisor can facilitate these interactions, ensuring that stakeholder concerns are addressed and incorporated into business practices.
3. Continuous Improvement: Human rights due diligence is not a one-time task but an ongoing process. A human rights strategy is not temporary or short-term; they are increasingly essential. A retained advisor provides continuity, helping the company to continuously assess and improve its practices in response to emerging risks and opportunities.
4. Crisis Management: In the event of a human rights crisis, having an advisor on retainer ensures that the company can respond swiftly and effectively, minimising damage and restoring stakeholder confidence.

Case Studies and Examples

Consider the example of a multinational fast fashion company facing allegations of child labour within its supply chain. By engaging a fractional human rights advisor, the company was able to conduct a thorough investigation, implement corrective actions, and develop a robust monitoring system to prevent future incidents. This proactive approach not only mitigated legal risks but also demonstrated the company’s commitment to ethical practices, earning praise from investors and consumers alike.

Another example is a mid-sized enterprise entering new markets with complex human rights challenges. Without any existing internal capacity to deal with increasing demands for human rights compliance, a part-time advisor provided the necessary expertise to navigate these challenges, from conducting human rights impact assessments to training local staff. This strategic support enabled the company to expand responsibly and sustainably. And with only the smallest impact on the annual budget.

The Path Forward

Incorporating human rights considerations into business operations is no longer just a moral imperative—it is a strategic necessity. Companies that fail to address these issues risk legal consequences, reputational damage, and loss of stakeholder trust. Penalties under the EU's Forced Labour Regulation have set the pace; seizure and destruction of the entire EU-wide stock of a product found to have any forced labour in the supply chain. The solution to avoiding such problems does not always demand a full-time commitment, especially for the small to medium-sized businesses out there.

Engaging a fractional or retained human rights advisor offers a pragmatic and flexible approach to managing human rights risks and opportunities. This model allows businesses to access the expertise they need, when they need it, without the overhead of a full-time hire.

By taking this step, companies can not only ensure compliance with evolving regulations but also position themselves as leaders in ethical business practices. In doing so, they can build stronger, more resilient organisations that are well-equipped to navigate the complexities of the modern business environment. The need goes well beyond costs, but is certainly cost-effective for those still starting out on their human rights journey.

The business landscape is changing, and with it, the expectations placed on companies to uphold human rights standards. A fractional human rights advisor provides a cost-effective, flexible solution to meet these expectations. Whether for compliance, risk management, or strategic advantage, engaging an advisor on a part-time basis can help businesses navigate the complexities of human rights due diligence while positioning themselves as ethical leaders in their industries.