Policy commitment

Introduction

Reading time: 2-3 minutes

A company’s commitment to respect human rights generally starts with a statement of policy. The process of developing such a statement should involve planning and consultation; it is an opportunity to build internal understanding of the company’s responsibility and is about more than merely writing a document. A policy statement should typically: 1) explain how the company understands its responsibility to respect; and 2) set clear expectations and guidance for those who are expected to adhere to or implement the policy, such as the company’s own workforce, suppliers and other business partners.

Summary of guidance points

Guidance point 1: Involving senior management
Guidance point 2: Evaluating existing commitments and policies
Guidance point 3: Identifying the company’s salient human rights issues
Guidance point 4: Involving internal and external stakeholders in the process
Guidance point 5: Developing the language of the statement
Guidance point 6: Obtaining top-level approval
Guidance point 7: Communicating the policy

Main company functions likely to be involved in the process

CSR/sustainability: Can bring expertise on human rights and on the company’s broader sustainability commitments

Business operations: Help ensure relevance as well as acceptance and implementation of the policy

Legal, internal audit, compliance: Review of policy in light of company’s legal obligations and verification of compliance once adopted

Senior management: Support and formal approval of policies

Government and investor relations: Consultation with specific stakeholders that they have responsibility for engaging with and communication of policy

Human resources: Relationship to existing policies on own workforce

Communications: To help ensure effective translation into business language within the company as well as supporting external communication once adopted

Guidance point 1

Involving senior management

Reading time: 1-2 minutes

The ‘tone at the top’ set by senior management is critical to ensuring the business takes respect for human rights seriously. A statement of policy can be an important tool in this regard. So the process of developing the policy statement needs to be supported by senior management from the start. Having a senior management champion can help kick-start internal conversations and signal the importance of the process.

Guidance point 2

Evaluating existing commitments and policies

Reading time: 2-3 minutes

It is useful to identify what human rights-related policies are already in place. Many companies already have a reference to human rights in their core business principles or have signed the Ten Principles of the UN Global Compact. Even companies that make no explicit references to human rights are likely to already be addressing human rights in practice in existing policies on health and safety, diversity and inclusion, product safety, responsible marketing or community relations. Such commitments can be referenced in an overarching human rights policy to show that the issue is not new to the company.

Guidance point 3

Identifying the company’s salient human rights issues

Reading time: 2-3 minutes

While the Guiding Principles do not prescribe any particular form for a policy commitment, the more tailored it is to the company’s reality, the more likely it is to be effective in practice. An important way to tailor a commitment is by ensuring that it addresses the leading human rights risks that the company might be involved with across its operations. For example, an ICT company would probably want to include a specific focus on the rights to privacy and freedom of expression, while a factory that dyes cloth would consider a range of impacts on its own workforce but also human rights impacts on local communities arising from environmental aspects of its operations, such as excessive water use or discharge of pollutants.

This requires at least a preliminary assessment of the company’s salient human rights issues. See Chapter 3.3 for guidance on how to assess human rights impacts, including identifying a company’s salient human rights issues.

Guidance point 4

Involving internal and external stakeholders in the process

Reading time: 2-3 minutes

Internal engagement is a critical opportunity to translate the potentially abstract concept of human rights into ‘business speak’ so that everyone inside the company can understand its relevance to their work. It is particularly important to engage those staff who will be expected to implement the policy. This can include managers, specialised or functional staff and those who own key business relationships or activities that can be connected to human rights risks. Engaging them can improve not only the content of the policy, but can also help generate greater buy-in once it is formally adopted.

In thinking about external stakeholders to engage in the process, it helps to consider who has insight into the company’s overall activities and impacts, as well as what is likely to be effective in addressing the company’s salient human rights issues. If a policy is being developed for a particular site or facility and its implementation will directly concern local communities, it will be important to consult directly with local stakeholders and their representatives. Stakeholder engagement is discussed in depth in Chapter 3.7.

Guidance point 5

Developing the language of the statement

Reading time: 4-5 minutes

Policy commitments can take many forms. It can be helpful to think about the following tiers:

High-level reference to human rights

A company may include a reference to human rights in its high-level values or mission statement, often focused on an expression of respect for all internationally recognized human rights, sometimes in the form of a quote from the company’s CEO or senior leadership.

Policy statement on human rights

A policy statement should provide clarity to staff and external stakeholders about what the company expects in regard to human rights. This means it should be tailored to the company’s particular circumstances, industry and human rights risks. The policy will need to be updated over time to include lessons learnt and reflect new insights into the company’s human rights challenges.

Operational guidance in specific functional/geographical areas

Some business operations or functions may be more at risk of being involved with particular human rights impacts. For example, human resources may engage in discriminatory hiring practices in countries where women are not allowed to work in certain jobs, or by stating a particular preference in a job ad that is discriminatory. The company’s security function that is required to collaborate with public security forces may run a higher risk of contributing to harm to the rights to personal security or health of local community members where public forces are poorly trained or use excessive force.

There are various sources of help: guidance can be found in sector- and issue-specific initiatives, such as the Voluntary Principles on Security and Human Rights, the Fair Labor Association (for human rights impacts in the supply chain, especially on workers) and the Global Network Initiative (addressing freedom of expression and the right to privacy for a growing number of ICT companies).

When developing guidance for specific company functions, there are a number of points to keep in mind:

• Ensure there is a clear connection to the company's high-level commitments;
• Use simple and straightforward language; this may involve using language that specific business functions understand even if it is not the language of human rights, als long as what is unique about human rights is preserved(meaning the focus on risk to people, not just risk to the business);
• Involve those who will eventually have to use it to help ensure that the guidance is as practical as possible.

Guidance point 6

Obtaining top-level approval

Reading time: 2-3 minutes

The Guiding Principles state that the policy should be approved at the most senior level of the company. It can be important to be able to show buy-in, or at least engagement, by those on the operational side of the business to give senior leadership the confidence that the policy will be well received internally. Similarly, external stakeholder engagement can provide reassurance that it will be accepted as a credible commitment.

Guidance point 7

Communicating the policy

Reading time: 5-6 minutes

After approval, the policy should be clearly communicated to relevant staff and external business partners and stakeholders – both those who are expected to implement it (for example, the company’s contractors and suppliers) and those who have a direct interest in its implementation (for example, potentially affected communities, investors, consumers and civil society organisations).

The company will need to consider what is most effective in terms of dissemination given the audiences it is intended for. Chapters 3.6 and 3.7 provide further guidance on communication and stakeholder engagement.

Wrapping up

Common pitfalls to avoid

Basing statements of responsibility on influence rather than impact

The Guiding Principles define a company’s responsibility based on how a company can be involved with negative human rights impacts, including through its business relationships. A company’s responsibility does not depend on its influence (or leverage). Therefore, a policy statement should be clear that a company does not have less responsibility where it has less influence; it may indeed be harder to address the situation, but the scope of the company’s responsibility does not change.

Ignoring certain rights without analysis

Sometimes, companies may reject certain rights as irrelevant to their business without conducting a human rights risk mapping, or consulting with appropriate experts. Wherever a company focuses on particular rights in a policy statement, it should be able to explain why it has chosen this focus and what process led to it, in line with the process of identifying ‘salient human rights issues’ described in Chapter 3.3.

Not addressing conflicting standards

Company staff will look to the policy or operational guidance when they find themselves confronted with dilemmas. Such dilemmas often involve conflicts between local standards and international or company standards. It is, therefore, important that the policy acknowledge that such situations may arise and give general guidance on what to do in order for staff to feel that the policy speaks to the real challenges they face.

Some suggestions for SMEs

Draw on codes from industry or multi-stakeholder initiatives

Instead of developing their own policy from scratch, SMEs can look to industry or multi-stakeholder initiatives that have a code of conduct with human rights provisions. For example, organisations like the Ethical Trading Initiative or the Fair Labor Association have their own codes of conduct regarding respect for the labour rights of supply chain workers that companies subscribe to upon becoming members. An SME does not have to become a member; the codes are typically available online and can be adapted to the company’s unique circumstances.

Integrate human rights into existing policies

Smaller companies often have a document that covers core company rules or a code of conduct; human rights could be included in such a document rather than in a stand-alone policy. For some SMEs, this need be no more than a paragraph, provided the commitment is communicated to those who need to know about it.

Start by doing before developing a policy

For any company, it is important to make a formal commitment. But, for some SMEs in particular, it may make more sense to start by implementing human rights due diligence, while considering the development of a formal policy.

Organise stakeholder engagement through sector organisations

Many SMEs interact with stakeholders within sector initiatives for particular commodities or industries, rather than setting up their own initiatives.