Ranking reveals firms' performance on human rights

By Gem Childe on 13th Mar 2017

Human Rights balance

Nestlé, Adidas and Unilever are also named among a small group of leading performers, while Costco Wholesale, Macy’s, Grupo Mexico and Yum! brands are among a much larger group with lower scores.

The product of two-years consultation with more than 400 companies and organisations, the Corporate Human Rights Benchmark is supported by 85 investors, accounting for $5.3 trillion in assets under management.

The Benchmark is led by investors and non-profit groups and analyses 98 companies from three high-risk industries – agricultural products, apparel and extractives – but will grow year-on-year to cover the world’s 500 largest listed enterprises.

It examines companies’ policies, governance, processes, practices, and transparency, as well as how they respond to serious allegations of human rights abuse. This is done by scoring the companies on 100 indicators across six measurement themes.

A small number of companies emerged as leaders scoring between 55-69 per cent, but the results skew significantly to the lower bands. A clear majority, 63 out of 98 companies, score below 30 per cent.

Investors are encouraged to use the CHRB’s results in their analysis of companies and investment decision making, including the identification of key human rights risks to discuss with management. Successful companies will have lowered their exposure to potential legal, reputational and financial risks that could arise from human rights abuses.

The ranking also paves the way for governments to use a smart mix of regulation and incentives to enhance transparency and minimum standards of corporate behaviour to make the business case for the respect of human rights.

Vicky Dodman, chief executive of the Corporate Human Rights Benchmark, said: “This first Benchmark is a baseline. In the future, we want to see companies move up as they respond to increased public scrutiny and engagement from investors. Inaction runs a high reputational risk and low scoring companies should act decisively, learn from leading practices, and rapidly improve.”