SHIFT performed a study on the maturity of corporate human rights reporting of 74 large companies. They conclude that companies still lack a focus on the most relevant human rights risks related to their operations, which results in failures of actually mitigating human rights risks.
Corporate reporting on social responsibility and sustainability issues has become common practice. However, according to SHIFT, these reports do not provide enough insight into how well a company is actually managing its impact on human rights. A better approach to corporate reporting can be a huge driver for the improvement of a company’s performance.
SHIFT developed a new methodology to assess the performance of the existing corporate reporting on human rights. Indicators of mature reporting were established based on the UN Guiding Principles and the UNGP Reporting Framework. This methodology was applied to a study of 74 largest companies in seven sectors.
- “More than half of the companies do not clarify which human rights are most relevant to their operations. This shows that the most severe potential risks to people are not managed properly.
- 45% of the companies do not define who is responsible and accountable for the management of human rights risks.
- 90% of the companies do not report on how the findings of the impact assessment are used for the mitigation of human rights violations.
- 16% of the companies do not give information about the governance of human rights risks.
- 45% provide no information about the performance on human rights is monitored”
Based on the key findings, SHIFT provided a list of do’s and don’ts for investors and other stakeholders.