HRDD TO CREATE ADDED ECONOMIC VALUE
The growing momentum worldwide among governments, businesses and civil society, for mandatory human rights and due diligence
The UN Guiding Principles form the basis for the National Action Plans (NAP) for Business and Human Rights. At international level, a total of 27 countries have currently adopted NAPs, 19 of which are European, including 16 EU member states.
CORE ELEMENTS OF DUE DILIGENCE IN THE NATIONAL ACTION PLAN:
A human rights policy statement
Procedures for the identification of adverse impact on human rights
Measures against adverse impacts and review of the effectiveness of these measures
Reporting: regular public reports on particularly high risk of adverse impacts
A Grievance mechanism
GERMANY: BINDING STEPS FOR GLOBALLY ACTIVE COMPANIES
Germany adopted its NAP in 2016. It aims to foster human rights protection by German companies working all over the world and has included a detailed human rights due diligence. The implementation of the German NAP follows an approach of moving from ‘principles to practice’.
Germany also has moved towards mandatory human rights due diligence legislation. The “Act on Corporate Due Diligence in Supply Chains” was adopted on the 11, June 2021 and will enter into force in 2023. Companies with over 3.000 employees need to conduct a human rights risk assessment across their supply chain and employ mitigative measures from 2023 onwards. From 2024 onwards, the legislations will be extended to smaller companies with 1.000 employees or more. From 2024 onwards, about 3.000 German companies will be affected.
SME TO THINK CREATIVELY TO IMPLEMENT HRDD
Statistically, half of the world’s population is working for a SME. SMEs account for about 90% of all businesses and contribute up to 50% of total employment in the world. SMEs tend to have fewer suppliers and customers, which can enable deeper and better-quality relationships that may require less policing legislation.
SMEs must often think creatively when it comes to implementing HRDD. They have a wide spectrum of means to effectively influence business partners, especially trough building trusting relationships with them. In addition SME leaders are able to instil empathy and empowerment through face-to-face interaction with employees, listening to them and encouraging desirable behaviours. For SMEs, people often are their most important asset.
INCREASING COMPLEXITY – DEMAND FOR COUNSELING AND TRAINING
In the light of recent legislation on HRDD in Europe the complexity of legal requirements for SMEs is increasing. Coincidentally, the demand for external counseling and training on HRDD on their part is also on the rise. The Business Scouts for Development Programme thus aims to offer training opportunities.
- The training will enable the participants to understand in what ways their respective companies will likely be affected by EU legislation on HRDD in the present and the near future.
- The training shall introduce means to companies for self-reliantly assessing necessary steps in order to prepare for the ramifications of HRDD related legislation in Europe to their business models
A COMPASS FOR SME
The SME Compass helps to understand and implement corporate responsibility and to get started with sustainable supply chain management. It offers guidance on how to implement corporate responsibility in a practical, process-oriented manner.
