How the Corporate Human Rights Benchmark is Important for Risk Management?
In the previous month, the opening of Corporate Human Rights Benchmark (CHRB) was started. This blog gives insights about how the Corporate Human Rights Benchmark is Important for Risk Management and why it matters a lot for the social compliance.
The Benchmark provides a virtual snapshot every year of the human rights implementation of the biggest companies in the world. The Benchmark is jointly formed by Aviva Investors, VBDO, Vigeo Eiris, Calvert Investments, the Business & Human Rights Resource Centre, and IHRB (Institute for Human Rights and Business). During this initial analysis, different companies from apparel, extractives, and agricultural sectors were analyzed across six different measurement categories. All the companies were selected as per their revenues, size, industry and geographic balance.
(Source: Business and Human Rights Resource Centre)
This Benchmark is established as per the United Nations Guiding Principles about Business & Human Rights as well as other industry-specific and international standards on the human rights with liable business conduct. This concentrates on the companies' processes, policies, transparency and practices as well as how they reply to the serious allegations.
The CHRB has included three companies, which have established the finest leadership about human rights presentation (scoring over 60%):
- BHP Billiton for extractives
- Marks & Spencer Group for agricultural products or apparel
- Rio Tinto for extractives
Why CHRB Matters a Lot for the Social Compliance
According to the United Nations, in a progressively organized world, there is nearer scrutiny of the corporate impacts on the communities and people. CHRB matters a lot for the social compliance because of these reasons:
- 1. It Creates a Balanced Global Marketplace
Larger businesses have a sound impact on how the international economy works. With benchmarking of corporate social performance in larger businesses against the international standards, the CHRB has the aim of helping create a balanced global marketplace.
- It Shows Why a Better Performance is required?
The average score of all 98 businesses examined was 28.7% with merely six businesses got more than 50%. Around nine companies have scored under 10%. CHRB clearly shows that there are significant opportunities for business improvement to execute and show good practice.
- It Allows Investors in Taking Ethics-Based Decisions
Around 85 investors support CHRB, accounting $5.3 trillion of assets. The investors are better equipped in direct investments with companies doing well as per the International Human Rights Standards and engaged with those that are not improving their performance. Furthermore, consumers increasingly reflect the investors' concerns, with companies they select to do the business with higher ethical standards, known as the social compliance.
- 4. It pushes the companies to fight for human rights
The Benchmark connects the competitive market nature and corporate management through encouraging the "race on the top" about the yearly rankings to drive better human rights accomplishment and build the finest practice standards. What's more, the CHRB informs and equips customers, civil society, and workers to take well-informed decisions through which they get the businesses they wish to engage.
- It Helps Companies to Become More Transparent
The CHRB is based on the UN's Guiding Principles. It means it has analysed publicly accessible information like data from the company websites, annual reports and other applicable information and documents given by the companies themselves. The factors haven't incorporated in the analysis include business' non-public practices and human rights-associated practices.
What Steps to Take
Learn About the CHRB
Learn the key findings of the CHRB (Corporate Human Rights Benchmark) report. You can also visit its website.
Improve the Carefulness of Human Rights
Discover how the insights help companies in monitoring the signs of regulatory, financial, reputational, and strategic risks together with human rights abuse in print, social media, broadcast, and web.
Analyze the Key Problems of Human Rights
Among the main human rights problems for the businesses in the year 2017 have been recognized as the modern slavery. Find out more about these problems by reading the reports about modern slavery for different industries like construction and fashion.