Reflections from the 16th Engaging Business Forum

By Ilse Heine

The Engaging Business Forum, an annual event for professionals working at the intersection of business and human rights (BHR), offers a unique platform to explore the latest trends, challenges, and solutions in the business and human rights space. This year, the forum brought together experts from business, civil society, and trade associations, among other key stakeholders, to discuss actions necessary to drive change within business globally. 

The forum included many thought-provoking panels, ranging from human rights risks in the logistics sector to sub-tier due diligence, and some repeat themes (e.g., remedy, just transition) from last year’s forum, which we summarized in a previous blog. Strong facilitation by the moderators, a diversity of expertise among the panellists, and critical engagement from the audience resulted in substantive discussions. Below are some of my key takeaways from the forum, focusing on current trends & challenges.

• Environmental impacts and human rights are intertwined and reinforcing, but we need to determine the right framework for action: A mock debate on whether environment and human rights are “allies” or “frenemies” forced me to test some of my assumptions in this space. Practically speaking, most agree that sustainability and human rights cannot operate in silos within companies. The Corporate Sustainability Due Diligence Directive (CSDDD) explicitly enforces synergies between the two, and as one audience participant rightly noted, companies’ resources are finite. Businesses have to be thoughtful about the trade-offs attached to “non-commercial” activities. However, the debate also prompted me to think critically about what it means, in theory, to assess environmental impacts through the lens of human rights. For instance, by taking this approach, are we reducing the environment to something that only matters insofar as its impact to humans? Can the accountability framework established by international human rights law be applied appropriately to the environment where ‘causality’ is much more difficult to prove (e.g., climate)? What are the unintended consequences of doing so? It was an important reminder to not get constrained by our cognitive silos, and recognize that we can approach the same issues through multiple methods. Ultimately, I do think we need to evaluate environmental impacts through a human rights lens, and this is proving to be increasing critical in strategic litigation, but we need to constantly remain open and flexible, always keeping in mind the “north star” or the impact we’re trying to achieve; that is, ensuring all communities have equal access to a clean, healthy, and sustainable environment. .
• While audits and certifications have their value, business needs to face their limitations: Social compliance audits have become very engrained in corporate human rights cultures and practices, so much so that, despite significant criticism of their efficacy, it is now proving a challenge to shift companies away from this status quo. Panellists acknowledged the benefits resulting from the growing maturity of the audit and certification fields, particularly when it comes to identifying health and safety risks; specifically, structural safety (e.g., access to fire exits). But, when it comes to the worst human rights abuses, such as forced labor or gender based violence, it’s well known that these issues are less likely to be surfaced through audits. Audits are and will remain important, but they are only one tool in the toolbox. They should be used where it is appropriate to do so vs. carte blanche. As one panellist succinctly stated, audits should be “limited” and “legitimate.” Direct engagement with workers vis a vis Human Rights Impact Assessments (HRIAs) are not perfect either and have their own limitations, depending on their design, but in my experience, they often reveal meaningful insights that audits do not. To inform internal decision making, business needs data to be persuasive and appropriately scale its engagements and actions, however, human rights, which are intertwined with complex and systemic social, political, and economic factors, cannot always be reduced to numbers alone. That isn’t to say that KPIs and other data points are not necessary or impossible to develop, but business should be comfortable with continuing to grapple with thorny topics whose solutions are not always as obvious as closing an audit non-compliance, and to not shy away from engaging in nuanced, albeit difficult discussions and collaborative action. .
• Some human rights leads within companies are witnessing the CSDDD shifting their priorities and resources away from innovative action towards a tick-the-box compliance exercise, but internally, these teams should be framing the legislation as a floor, and an opportunity, rather than a ceiling: A common thread throughout most of the panels was the CSDDD, which, taking force in 2027, imposes civil liability on companies that do not meet the requirements of the legislation, including conducting mandatory human rights and environmental due diligence (HREDD). Without meaningful guidance yet from the EU, some companies are naturally feeling anxious about identifying and closing their gaps in relation to the CSDDD. Yes, legislation is moving ‘the floor,’ and many in the BHR space are excited by the introduction of mandatory standards, but civil society and practitioners are warning companies against abandoning the UN Guiding Principles on Business and Human Rights (UNGPs). I believe that the CSDDD brings specificity, clarity, and legal certainty to the guidance from the UNGPs, but it also has big gaps. For one, it exempts financial institutions, which have significant influence over the businesses they finance and invest in, from due diligence. It also excludes the “sale, use, and end life of products,” thereby moving away from the full value chain risk-based approach established by the UNGPs. Granted, the UNGPs have not lead to the level of action and impact we aspire to, but they offer a foundational and adaptable framework that will continue to be essential in a field whose target is ever evolving. Additionally, the CSDDD should be leveraged as an opportunity by brands to move away from a “stick” approach that has largely been the status quo, and rather, re-engage with their suppliers in a way that encourages co-creation, collaboration, and shared responsibility.

Many participants who have been attending the forum for several years commented on how far it has come from its early days. Granted, the forum also revealed just how complex and challenging the field has grown. Companies must now navigate diverse and sometimes incoherent policies and regulations, meet growing demands from civil society, and face the practical realities of leading human rights and sustainability teams. On the other hand, civil society, who often witness firsthand egregious human rights abuses, are frustrated that business isn’t being ambitious or moving fast enough. Even so, I didn’t get the sense that participants walked away from the forum feeling defeated. Rather, it was a good reminder that solutions to these challenges will not be solved by a single company, trade association, or NGO alone. We repeat it often in this field, but is important, nevertheless, to reinforce that collaboration is key. It can be more time consuming, and involve competing priorities and objectives, but the outcomes are generally more robust. It is, after all, what led to the development of the UNGPs. Overall, Article One will continue to guide and partner with our clients in making the case for leadership on human rights, and that the challenges, though not insignificant, are not insurmountable.  

If you have any questions or would like to learn more about Article One’s approach to business and human rights, please contact hello@articleoneadvisors.com.