Investors Worth $5 Trillion Call Out Companies Over Human Rights Disclosure

(Photo Credit: Corporate Human Rights Benchmark)

by | May 21, 2018

human rights disclosure

(Photo Credit: Corporate Human Rights Benchmark)

A new report from the Corporate Human Rights Benchmark (CHRB), which is backed by a $5 trillion investor coalition, calls out 28 companies for failing to provide human rights information. The report also identified major corporations working on improving human rights to improve their scores in the benchmark.

CHRB is described as the first publicly available assessment and ranking of the human rights performance of 100 of the largest extractives, apparel, and agricultural product companies. It launched in 2013 as a multi-stakeholder initiative that draws on investor, business and human rights, and benchmarking expertise from seven organizations.

The “Corporate Human Rights Benchmark Progress Report” found that benchmarking is helping to drive a race to the top in corporate human rights performance as more companies engage on the issue. This means reviewing and changing their programs and policies to better manage and report on human rights. Investors are also requesting this disclosure.

After a pilot benchmark, the nonprofit CHRB worked with the UNGP Reporting Framework Investor Coalition, a group of over 85 investors with over $5 trillion. These investors sent a letter to all the companies that had been assessed. The letter outlined expectations concerning human rights and requested responses about the companies’ follow-ups to the benchmark.

Nestlé, Gap, Kellogg, Mondelez International, Starbucks, Target, and Tesco were among the companies that formally responded to that letter. “We are using the results of the company assessment and input from multiple stakeholder groups to continually evolve our programs and policies,” Gap’s response read.

However, the report also called out 28 companies that have not meaningfully engaged with the CHRB. “These large companies, including Kraft Heinz, Macy’s, Hermès, and Prada, had some of the lowest scores in the benchmark, indicating a lack of transparency and public commitment to managing human rights risks and impacts,” according to the benchmark organization.

The 28 companies are: Alimentation Couche-Tard, BRF, China Petroleum & Chemical Corporation, China Shenhua Energy, CNOOC, Coal India, Costco Wholesale, Devon Energy, EOG Resources, S.A.C.I. Falabella, Gazprom, Heilan Home, Hermès International, Kohl’s, Kraft Heinz, Kweichow Moutai, L Brands, LVMH, Macy’s, Norilsk Nickel, Oil & Natural Gas Corporation, PetroChina, Prada, Ross Stores, Shoprite Holdings, Surgutneftegas, Under Armour, and Valero Energy Corporation.

“Issues such as modern day slavery, worker safety and freedom of association can be material to the financial performance of these companies and they may risk restricted access to capital due to reputational damage and regulatory backlash,” said CHRB Board chair Steve Waygood, who is also chief responsible investment officer at Aviva Investors.

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