UPDATE

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We are weeks away from releasing Shift’s Business Model Red Flags, a menu of business model features that carry inherent human rights risks. It aims to help companies, investors and others foster sustainable business models that can be economically successful without exacerbating inequalities.

Today, we are building on the beta version that we released in May 2020 and sharing the final list of 24 red flags, divided into three categories: Red Flags in the Value Proposition; Red Flags in the Value Chain; and Red Flags in the Revenue Model. You can find the list further down, on this page. It is also available for download in PDF format.

We are also excited to share two Red Flags in their final form, as a preview of what this collection will look like:

  • Red Flag 13 | When a business’s commercial success substantially depends on depleting natural resources or public goods with increasing pressures on health
  • Red Flag 17 | When a business’s commercial success substantially depends on using gig workers or other precarious labor

Both of them are available for download at the bottom of this page. The 24 flags will be available to the public in Q1 2021.


The final list of Business Model Red Flags

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Below is our final list of 24 Business Model Red Flags. Click on the + sign in each category below to expand each category:

Red Flags in the Value Proposition

When the business’s commercial success substantially depends on:

  1. Lowest cost goods or services in ways that put pressure on labor rights
  2. High-speed delivery such that it places pressure on warehouse workers and logistics workers in the “last mile”
  3. Project timelines that undermine consultation with communities
  4. Privatized access to public goods with risks to quality of service
  5. Algorithmic decision-making that can result in discrimination
  6. Providing online platforms with potential for online and offline harm
  7. Financial or advisory services that enable high-risk clients to cause harm
  8. Products that harm when overused
  9. Products that harm when misused
  10. Products that harm when used as intended
Red Flags in the Value Chain

When the business’s commercial success substantially depends on:

  1. Speed in developing products or services, or delivering projects removing time to avoid harms
  2. Land use where ownership may be contested
  3. Depleting natural resources or public goods with increasing pressures on health
  4. Commodities with unclear provenance and visibility to at-risk workers
  5. Sourcing commodities that are priced independent of farmer income
  6. Sourcing low-paid labor from labor providers
  7. Using gig workers or other precarious labor
  8. Business relationships with limited influence to address risks to people
  9. Using data such that privacy and other rights are undermined
  10. Shifting inventory risk to suppliers with knock-on effects to workers
  11. Automation at a speed or scale that leaves workers little chance to adapt
Red Flags in the Revenue Model

When the business’s commercial success substantially depends on:

  1. Sales-maximizing incentives that put consumers at risk
  2. Markets where regulations fall below human right standards
  3. Aggressive tax-minimization strategies

Available Business Model Red Flags

2 resources

Red Flag 13

Depleting natural resources or public goods with increasing pressures on health

Red Flag 17

Using gig workers or other precarious forms of labor

About the Valuing Respect Project