Tech Forward Solutions: Harnessing Innovation to Address Human Rights Risks in the Supply Chain

By Ilse Heine

The human rights risks associated with technological advances have gained widespread attention from civil society, companies, regulators, and other stakeholders. The concerns, such as privacy and security risks, and bias, have been well documented, and risks and harms continue to evolve. At the same time, however, we should not lose sight of the potential of emerging technologies to help companies to address their human rights risks and impacts. This is particularly true for human rights risks in the supply chain, where challenges persist, and companies face increasing regulatory scrutiny and obligations. Specifically, current and emerging HRDD regulation is now requiring multinational companies to address risks in their supply chains, or face significant fines and in some cases, civil liability. This requirement to conduct human rights due diligence at scale may serve as a further impetus for companies to test the potential of technology solutions to address human rights in the supply chain. Below, we summarize some of the emerging technologies that are being used by companies across three key processes: 1) supply chain mapping & traceability; 2) risk assessment; and 3) addressing risks using worker voice tools.

Supply Chain Mapping & Traceability
Supply chain mapping of identifying all the potential actors involved in the production and distribution of goods and services, while tracing is the process of tracking the provenance and journey of the products and their inputs. The aim of supply chain mapping and traceability is to provide visibility into the various stages of the supply chain. It is critical for identifying, assessing, and mitigating human rights risks. Such visibility facilitates engagement and collaboration with suppliers, promotes an understanding of the full scope of impacts, and allows a company to prioritize the most severe human rights harms. In a survey by EY, supply chain executives said that end-to-end visibility is the number one factor in creating a successful supply chain. However, only 6% of respondents are confident in their systems and capabilities for end-to-end supply chain visibility.

Companies across a variety of industries are leveraging emerging technologies, including blockchain and geospatial technology, to assist with their supply chain mapping & traceability strategies. A few examples follow:

• Nestle has implemented blockchain technology to trace the origins of ingredients in its products. Through IBM’s Food Trust blockchain platform, Nestle can track the source of ingredients like coffee, palm oil, and milk.
• Nike has partnered with AntChain to create a product traceability system that uses both blockchain technology and embedded NFC (Near Field Communication) chips. This traceability technology has been applied to nearly 130,000 pairs of Nike’s 17 popular shoe models.
• Unilever partnered with Orbital Insight to pilot a technology that uses geolocation data to help identify and map the individual farms and plantations that are most likely to be supplying the palm oil mills in Unilever’s extended supply chain. The technology leverages GPS data – aggregated and anonymized – to allow Orbital Insight to spot traffic patterns. Where there is a consistent flow of traffic between an area of land and a mill, it suggests a potential link.

Risk Assessment & Ongoing Monitoring
A risk analysis is one of the core elements of human rights due diligence. By assessing the risks, companies can prioritize the most urgent and severe issues and develop action plans to mitigate them. There are various challenges that companies can face in conducting a supply chain risk assessment, including limited transparency, lack of data, difficulties with engaging suppliers, and diverse regulatory landscapes, among others.
In an effort to address some of these challenges, companies are exploring technological solutions, such as predictive analytics. That said, compared to supply chain mapping and traceability, it appears that the use of innovative technologies for risk assessment purposes is still nascent.  

• Apple conducts independent, third-party assessments of its suppliers that are focused on the requirements of Apple’s Supplier Code of Conduct. Ahead of unannounced assessments and visits to supplier sites, Apple uses predictive analytics to assess risks at supplier facilities.
• Coca Cola has partnered with Diginex to develop a digital platform that identifies recruitment related human rights risks within supply chains. The platform evolved to include a multilingual worker voice tool, diginexAPPRISE, which allows companies to conduct digital worker interviews in supply chains at scale.

Addressing Risk – Worker Voice Tools
Increasingly, technological tools are being used to facilitate the inclusion of ‘worker voice’ in supply chain human rights due diligence. The most common worker voice tools are surveys relying on automated calling or reaching workers with online surveys through mobile devices. Unlike traditional social auditing methods, these tools can rapidly collect information from a very large number of workers across one or many worksites.

However, human rights practitioners have cautioned against conflating the use of technology with worker ‘voice’ and agency. For instance, worker voice technologies can result in a one-way collection of feedback, rather than a meaningful, direct dialogue with workers. Other publications have also raised concerns about the quality of the data, safety risks for workers, and inaccessibility, among others.

Seeking to overcome these limitations, several companies are moving ahead with tech-enabled worker engagement tools as part of their broader due diligence efforts. Often, to safeguard against the concerns listed above, companies will use these tools in conjunction with, rather than in lieu of other methods of engagement. 

• Patagonia is piloting digital surveys to gather workers’ feedback on fire safety and prevention program, which is one of several worker welfare programs they have in place.
• Through a grant from the U.S. Department of State, Levi Strauss partnered with the New American Foundation and ConSensys to develop a blockchain platform that would capture survey data directly from workers. The grant is the first time that the State Department has provided an opportunity for an organization to leverage blockchain technology to track and measure worker wellbeing.
• Nestle, Mars, Walmart, M&S, and Tesco have partnered with the Issara Institute, which uses worker voice technologies to reach migrant workers through the Issara hotline, Facebook, social media, and established connections with migrant workers.

There are always risks associated with the use of technology, and not every problem requires or can be solved through a technological solution. Technology alone will not address the root causes of human rights abuses in the supply chain, but it can be an important part of the solution. Before deploying any technology, a business should carefully consider the risks and tradeoffs, the cost and necessary resources, and other contextual factors. That said, based on some of the examples listed above, it’s clear that, if used appropriately and strategically, emerging technologies can offer several benefits to companies, including potential efficiencies, better scale, and improved transparency and accountability within the supply chain.

If you have questions or would like to learn more about how your organization can effectively conduct human rights due diligence in your supply chain, you can reach us at hello@articleoneadvisors.com.