Archives: Resources

European Commission Sector Guides on Implementing the Guiding Principles

The link above leads to all three guidance documents in English. There are also a few unofficial translations of these guides: Japanese: ICT sector | French: oil and gas sector

While implementing the Guiding Principles is very specific to each company, there are common challenges and strategies by industry or sector. These guidance documents feature “a to z” guidance for companies in three sectors: information and communication technology (ICT), oil and gas, and employment and recruitment. The guides were developed through an extensive process of multistakeholder consultation.

Learn more about the collaboration that supported the development of these resources.

Dispute or Dialogue? Community Perspectives on Company-Led Grievance Mechanisms

This book includes a foreword and overview chapter authored by members of the Shift team. The summary below is excerpted from the resource.

Summary

What is a company– community grievance mechanism?

We define a company–community grievance mechanism as a process or set of processes for receiving, evaluating and addressing grievances from affected communities, in a timely and consistent manner at the site or operational level. The mechanism may be wholly or partially run by the company. Grievances might be real or perceived: the latter may be a source of acute anxiety for communities and can be addressed through dialogue and provision of timely and accurate information.

Extractive industry companies and their investors increasingly see a strong business case for building good relations with local communities, and addressing conflict and potential conflict in a timely and effective manner. This involves engaging meaningfully with communities affected by project operations, so as to build trust and to respond appropriately to any local concerns, major or minor. If left unaddressed even minor complaints may escalate into disputes or even violent conflict. This is potentially devastating for local communities. From the company perspective, it can also result in damage to its reputation, a loss of operational time and money, and it can put future investment opportunities at risk.

Effective channels by which local communities can voice their concerns about a project — and get these concerns addressed — are particularly important. In general the only formal mechanisms by which citizens can challenge the activities of extractive companies tend to be those available under host country legislation. However, courts and tribunals in host countries, particularly in developing countries and emerging economies, can be inefficient, corrupt or reluctant to interfere with extractive industry activities (Schwarte and Wilson, 2009). This can result in increased conflict and resentment among host communities, which may be a key legacy challenge when one company acquires a project from another.

Leading oil and gas, mining and forestry companies are starting to establish their own formal mechanisms to address and resolve local citizens’ grievances. Grievance mechanisms provide a channel for concerns to be identified and addressed before they escalate. As part of an effective overall community engagement strategy, they can help to build trust with stakeholders, reduce operational risks and enhance management of project impacts and community relations.

Frequently companies establish grievance mechanisms in order to comply with the formal requirements of project finance and international certification initiatives, which address conflict resolution and human rights protection. Since 2006, for example, the International Finance Corporation (IFC) requires its clients — companies that receive project finance — to set up and administer procedures to address project-related grievances from affected communities. Other international financial institutions have similar requirements. The environmental management systems standard ISO 14001 of the International Organization for Standardization (ISO), and the Forest Stewardship Council (FSC) certification standard both require certified companies to establish company–community grievance mechanisms.

More recently, a major influence on the adoption and development of grievance mechanisms, and on public awareness, has been the work of Professor John Ruggie in his role as UN Special Representative on Business and Human Rights, and the UN Human Rights Council’s endorsement of the UN Guiding Principles on Business and Human Rights (UN/OHCHR, 2011) (see Chapter 2).

There is a growing body of literature on company– community grievance mechanisms, supported by online resources such as BASESwiki (transferred to the ACCESS platform in 2013).

In general, there is a need for more long-term analysis of the implementation, impact and effectiveness of grievance mechanisms, including analysis of the broader societal impacts beyond day-to-day resolution of grievances. Having identified in particular a lack of material on the community perspectives on company-led grievance mechanisms — their effectiveness and impact on sustainable development and livelihoods locally — IIED sought to address this by undertaking and commissioning the research in this book, with case studies based on a mix of desk-research, interviews and fieldwork.

Chapter 2 is a review of the current literature and experience of grievance mechanisms. Based on desk-research and interviews with company and industry experts, it explores definitions of the term ‘grievance mechanism’; some history behind the evolution of grievance mechanisms including alternative dispute resolution; key drivers, standards and guidance for their design and use; and consideration of future trends in grievance mechanism development. This is followed by a series of four chapters focusing on case studies in the oil and gas, mining, and forestry sectors.

Chapter 3 covers the grievance mechanism run by BP in Azerbaijan for the 1,768km Baku–Tbilisi– Ceyhan (BTC) pipeline, which passes through Azerbaijan, Georgia and Turkey. The BTC pipeline project has been the focus of considerable international scrutiny by civil society organisations and project lenders, due to its size and impact and international profile. The project has benefited from investing in civil society capacity building during the construction phase, which has enabled informed dialogue between the company and civil society over the years. The case study highlights the need to balance government and company responsibilities in resolving grievances. It also demonstrates how a major international project such as this can positively influence government practice.

Chapter 4 is a case study of the company Congolaise Industrielle des Bois (CIB), which manages around 1.4 million hectares of tropical forest concessions in the northern Republic of Congo. The company achieved its first FSC certificate in 2006 and full certification in 2010. FSC has been a key driver for CIB to establish a grievance mechanism for resolving land-related disputes and for providing fair compensation for loss or damage to property, livelihoods and resources. This case study demonstrates how grievance mechanisms can be based on existing community structures and underscores the need to respect traditional conflict resolution approaches.

Chapter 5 relates to the Sakhalin-2 oil and gas project in the Russian Far East. Like the BTC project, Sakhalin-2 has used project finance, and has come under considerable international scrutiny and criticism, but is also seen as a pioneer of community engagement in Russia. This case study analyses the experience of the operating company, Sakhalin Energy, in addressing grievances and building a dialogue with the indigenous peoples in the north of the island. This is then compared to a conflict that has developed with a (non-indigenous) dacha community located close to a liquefied natural gas plant in the south of the island. The case study provides an example of a well-functioning grievance mechanism, but highlights the need to understand the full range of complexities associated with building dialogue with communities, including outside the grievance resolution process.

Chapter 6 considers the effectiveness of three different grievance mechanisms and stakeholder engagement processes implemented by mining companies. The first is Anglo American’s approach to stakeholder engagement, its grievance mechanism and the computerised system employed to manage grievances. The second is TVIRD in the Philippines, which demonstrates the value of building on local and traditional modes of communication and dispute management to create culturally appropriate grievance mechanisms. The third case, Kaltim Prima Coal in Indonesia, illustrates the ‘governance gaps’ that exist in a number of developing countries that a company–community grievance mechanism can help to fill.

The book’s findings demonstrate the importance of having an open and responsive overall approach to stakeholder engagement within which a grievance mechanism can be employed effectively. The book offers examples of successful approaches for enhancing dialogue — from civil society capacity building to designing engagement around traditional decision-making processes, as well as system innovations such as electronic logging, which facilitate the monitoring and management of grievance resolution within the company. The book considers community conflict with an eye to understanding the mechanics and the challenges of how company– community engagement takes place in practice. It also offers local perspectives on the implementation of standards and processes that are frequently analysed primarily at the level of system or process. As such the book offers a fresh take on a growing body of literature on company–community grievance mechanisms.

Conducting Meaningful Stakeholder Consultation in Myanmar

The research for this report was funded by the Government of Sweden. | Also see our Viewpoint on this topic

Summary

A large number of western companies from a wide range of sectors are now seeking to operate in Myanmar and can bring a number of substantial benefits to Burmese citizens. At the same time, Myanmar is only recently emerging from years of military rule that were characterized by extensive human rights violations, weak rule of law, corruption, and decades of civil war in Myanmar’s ethnic states. In this context, companies face significant risks of causing, contributing to, or being linked to negative human rights impacts in Myanmar. The UN Guiding Principles on Business and Human Rights, endorsed by the UN Human Rights Council in June 2011, provide guidance on how meaningful consultation with potentially affected groups and other relevant stakeholders can assist companies, both to gauge and mitigate their risk of involvement with human rights impacts.

Shift compiled this report to assist companies that are considering operating, or are already operating, in Myanmar as they structure their stakeholder engagement process. Shift conducted community consultations and interviews with representatives of non-governmental organizations, networks of organizations, think tanks, and other civil society organizations, as well as entrepreneurs, Embassies and development agencies in Myanmar and on the Myanmar/Thai border. The questions asked were designed to (1) enable a survey of stakeholder viewpoints relating to the entry of companies into Myanmar, and (2) elaborate on the elements for companies to consider when structuring a stakeholder engagement strategy. A number of recurring themes emerged from the answers provided.

High Expectations: Interviewees have high expectations of the benefits that companies can bring to Myanmar. Not only do they look to companies to create jobs and decrease the level of poverty, they also hope that companies can assist in ensuring that Myanmar’s recent economic and political reforms pave the way for a peaceful future, founded on respect for human rights and fundamental freedoms, by all and for all. Interviewees further observed that the entry of new companies can be an opportunity to set higher standards for corporate conduct than those imposed under current laws, which were deemed to be inadequate, weak and poorly-enforced.

Significant Fear: Interviewees expressed significant fear of being taken advantage of as the country opens up to the outside world. Interviewees remarked that they have yet to see benefits resulting from the presence of companies. Moving forward, they would like to see companies establish a ‘win-win’ situation, where corporate operations benefit both the companies and the people of Myanmar generally, rather than a select few within the country. Interviewees further feared that companies would structure their operations in Myanmar without an accurate understanding of the situation on the ground. They emphasized how fragile and complex the recent economic and political reforms are.

Interviewees noted with concern the increase in land grabbing. In particular, the mere anticipation of business is leading unscrupulous powerful individuals as well as crony-led companies to grab land, which they plan in turn to sell to companies at a profit in the future. They feared that companies would perpetuate low labor standards and contribute to environmental degradation. Interviewees also requested that companies make an extra effort to prevent violent crackdowns against protestors, and urged companies to recall that freedom of expression and peaceful assembly is very new in Myanmar and that its limits are currently being tested by local communities. Interviewees expressed concern that new companies may wipe out their small farming businesses or favor one group of Burmese over others. A large number of interviewees remarked that companies will have to hold themselves to a higher standard than the current laws and regulations.

Regional Differences: Interviewees from ethnic states remarked that companies are not welcome in the ethnic states until the ceasefire agreements are stable, peace agreements have been concluded and political dialogue has been achieved. The interviewees noted that the stakes are high in the current context. They fear that companies will upset the ongoing democratic reform process that is still seen as extremely fragile. Interviewees further noted that change has yet to trickle through outside of the larger cities of Yangon, Naypyidaw and Mandalay.

Shifting Civil Society Scene: Interviewees emphasized that stakeholder consultation in a country emerging from decades of military rule is necessarily complex. They underlined that the long history of opposition to the military regime makes the situation especially polarizing and that the role of civil society, including community-based organizations and non-governmental organizations, was shifting considerably.

Determining Stakeholders to Engage With: Interviewees highlighted a large number of organizations that could assist companies in understanding the specific context in their area of operation, identifying who to speak with, and providing guidance on how to tailor stakeholder engagement so that it is meaningful in that area. The stakeholders identified included the government and the political opposition, international actors, local networks and sector-specific organizations working, for instance, on land, labor, the environment, gender, and special economic zones. Interviewees highlighted the added complexity of meaningful consultation in ethnic states characterized by years of armed conflict, poor living conditions, and negative experience with corporate engagement. They identified a number of community-based organizations, issues-specific civil society organizations, and youth and student organizations that can assist companies in structuring their stakeholder engagement in these ethnic states, once political dialogue has been achieved.

Expectations of Meaningful Consultation: Interviewees expected companies to proceed with genuine, meaningful consultation and provided suggestions for how companies can conduct grassroots stakeholder consultation which involves: (1) transparency and understanding in a public education phase, (2) inclusion in a public dialogue phase, and (3) integration of community concerns in a feedback phase. They saw these phases as key for companies to provide a “win-win” situation that benefits both the companies and the Burmese people at large.

Collaborating With the IFC on Guidance for High Risk Contexts

Jump to: Overview of our work with financial institutions on the Guiding Principles | Our report on human rights due diligence in high risk circumstances

In alignment with the International Finance Corporation’s (IFC) revised Performance Standards on Environmental and Social Sustainability, the IFC has been exploring the development good practice guidance for its private sector clients on the issue of human rights due diligence in high risk circumstances. Shift provided expert input to the IFC in 2013 on the content of potential guidance.

The Performance Standards’ requirements regarding the environmental and social due diligence processes that all IFC-financed projects must have in place are robust; however, the Performance Standards themselves recognize that, in certain high risk circumstances, it may be appropriate for companies to complement these processes with specific human rights due diligence (see Performance Standard 1, footnote 12). This raises two key framing questions that any guidance on this issue should address:

  1. Under what circumstances might specific human rights due diligence be appropriate;
  2. What should human rights due diligence entail in such high risk circumstances?

Any IFC guidance on these questions would need to be practical, relevant and grounded in the challenging realities facing companies that operate in complex, high-risk contexts. It should also build upon existing resources for companies on these issues, and seek to ensure a convergence of guidance wherever appropriate.

While the immediate audience for good practice guidance issued by the IFC is IFC client companies, the impact of the Performance Standards extends well beyond IFC-financed projects – providing a global benchmark referenced by numerous public and private financial institutions, as well as informing the policies and practices of many companies operating in emerging markets.

This collaboration informed a report that we published in 2015 on human rights due diligence in high risk circumstances.

Unternehmensverantwortung für Menschenrechte: Ableitung von Handlungsempfehlungen auf der Basis von Experteninterviews und internationalen Fallstudien

Also see: our news update on support to the German government on its National Action Plan on implementing the Guiding Principles.

This study was a precursor to the consultation process on a German National Action Plan on Business and Human Rights and is available in German only. The summary is excerpted from the resource.

Summary

Das Bundesministerium für Arbeit und Soziales (BMAS) hat die vorliegende Studie zur Umsetzung der VN-Leitprinzipien im Rahmen der „Nationalen Nachhaltigkeitsstrategie zur gesellschaftlichen Verantwortung von Unternehmen (Corporate Social Responsibility – CSR) – Aktionsplan CSR – der Bundesregierung“ vergeben (im Folgenden kurz: CSRAktionsplan).

Der CSR-Aktionsplan sieht u. a. ausdrücklich die „Stärkung von CSR in internationalen und entwicklungspolitischen Zusammenhängen“ (Bundesregierung 2010: 23) vor. Vorliegende Studie ist im Kontext dieser Bemühungen zu verorten und soll laut Ausschreibungstext dazu beitragen, „Voraussetzungen und mögliche Wege für die Umsetzung der von Prof. Ruggie beschriebenen ‚Guiding Principles‘, insbesondere zum Kapitel ‚The corporate responsibility to respect human rights‘ […, zu] erörtern. Dabei soll es im Kern um die Frage gehen, ob und inwieweit staatliche Institutionen Unternehmen hierbei unterstützen können.“

Vor diesem Hintergrund stellt die Studie als Basis für die weitere Untersuchung und Analyse zum einen die Anforderungen der Leitprinzipien der Vereinten Nationen (VN) an Unternehmen in Bezug auf deren Verantwortung, die Menschenrechte zu respektieren, dar. Zum anderen berücksichtigt sie die korrelierenden Anforderungen an Staaten, die sich aus der Verpflichtung ergeben, die Menschenrechte zu schützen. Entsprechend der Konzeption des Gesamtprojektes basiert die Studie des Weiteren auf 22 leitfadengestützten, vertraulichen Experteninterviews mit Vertretern/-innen von Unternehmen (kleiner und mittelständischer sowie großer Unternehmen), Unternehmensverbänden und -netzwerken, der Zivilgesellschaft, von Ministerien, der Wissenschaft und aus dem gewerkschaftlichen Bereich sowie auf fünf Fallstudien zu Beispielen guter Praxis aus Dänemark, Norwegen, Großbritannien, den Niederlanden und den Vereinigten Staaten von Amerika (USA).

Advising the German Labor Ministry on Implementation of the UN Guiding Principles

In 2012, the German Federal Ministry of Labour and Social Affairs put out a request for advice on the implementation of the Guiding Principles. Shift worked with the German sustainability organization adelphi and our other project partners — the Danish Institute for Human Rights and Tilburg University — to conduct this work. | Learn more about our engagement with the German government on its National Action Plan on business and human rights

The study includes a review of the expectations of German business and civil society stakeholders regarding government assistance and guidance in the implementation of the Guiding Principles; an evaluation of best practice examples from other relevant states; and concrete recommendations for action.

Supporting the Norwegian OECD National Contact Point

Shift was pleased to provide support to the Norwegian National Contact Point (NCP) as it underwent a formal peer review process in 2013 in line with the OECD Guidelines for Multinational Enterprises. Representatives of the NCPs of Canada, Belgium, Colombia, Netherlands and the UK were official members of the peer review delegation. Hungary, Mexico and the OECD Secretariat also participated as observers. In January 2014, the delegation submitted its final report.

Shift provided support in two main ways:

  • Working collaboratively with the Norwegian NCP to support the design, preparation and implementation of the peer review process and to document that process;
  • As a credible, constructive and independent analyst of the information gathered during the process, to report on the strengths and shortcomings of the NCP and provide recommendations for the NCP going forward. This analysis fed directly into the final report by the delegation.

Also see:

Human Rights Reporting and Assurance Frameworks Initiative

The Human Rights Reporting and Assurance Frameworks Initiative (RAFI) is a multistakeholder consultative process that supported the development of the UN Guiding Principles Reporting Framework and its two supporting guidances: implementation guidance for companies that are reporting, and assurance guidance for internal auditors and external assurance providers. The UNGP Reporting Framework, its supporting guidances and additional insights about trends in existing company reporting on human rights are available at www.UNGPreporting.org.

Documentation about the consultative process of RAFI is kindly hosted by the Business & Human Rights Resource Centre. This page provides an overview of the UNGP Reporting Framework — we encourage readers to also visit the Framework’s dedicated website.

In August 2016, Shift began a multi-year, multi-country reporting program that uses the UNGP Reporting Framework to catalyze improved reporting and performance by companies on human rights. Learn more about that program here.

What is the UNGP Reporting Framework?

“The UN Guiding Principles Reporting Framework is an indispensable tool that companies have been waiting for. This tool will mark a major breakthrough in company relations with individuals and communities whose lives they impact.” – John Ruggie, author of the UN Guiding Principles on Business and Human Rights

John Ruggie, author of the UN Guiding Principles on Business and Human Rights

The UN Guiding Principles Reporting Framework is the first comprehensive guidance for companies to report on human rights issues in line with their responsibility to respect human rights. This responsibility is set out in the UN Guiding Principles on Business and Human Rights, which constitute the authoritative global standard in this field. The UNGP Reporting Framework was launched in February 2015.

The Reporting Framework provides a concise set of questions to which any company should strive to have answers in order to know and show that it is meeting its responsibility to respect human rights in practice. It offers companies clear and straightforward guidance on how to answer these questions with relevant and meaningful information about their human rights policies, processes and performance.

The Reporting Framework is supported by two kinds of guidance: implementation guidance for companies that are reporting, and assurance guidance for internal auditors and external assurance providers.

Click here to see the latest news on the UNGP Reporting Framework

How the Reporting Framework Was Developed

The UNGP Reporting Framework was developed through the Human Rights Reporting and Assurance Frameworks Initiative (RAFI). RAFI was co-facilitated by Shift and Mazars through an open, global, consultative process involving representatives from over 200 companies, investor groups, civil society organizations, governments, assurance providers, lawyers and other expert organizations from all regions of the world. Consultations took place in Addis Ababa, Bangkok, Jakarta, London, Manila, Medellin, New York and Yangon.

The Reporting and Assurance Frameworks Initiative was overseen by an Eminent Persons Group. Further information about the project team and the Eminent Persons Group can be viewed here. RAFI was made possible by grants from the governments of Norway, Sweden and the United Kingdom.

“The UN Guiding Principles Reporting Framework equips us to understand what we may face – it reduces the number of unknown unknowns.”

Richard Kooloos, Head of Sustainable Banking, ABN AMRO; early adopter of the UNGP Reporting Framework

Support for the Reporting Framework

The Reporting Framework is supported by an investor coalition of 87 investors representing $5.3 trillion assets under management, by six early adopter companies and by leading institutions including the UN Working Group on business and human rights, the UN Global Compact and the International Integrated Reporting Council.

The Framework is cited and recommended by multiple governments in policy and guidance documents. Hundreds of companies have participated in training and outreach on the Framework, and dozens more are using the Framework for both internal management of human rights as well as for reporting. | Learn more about what supporters and users say about the UNGP Reporting Framework

The UNGP Reporting Framework is, “an essential tool that enables investors to review companies’ understanding and management of human rights risks. It will also guide us in our engagement with companies going forward.” — investor statement of support

How to Use the UN Guiding Principles on Business and Human Rights in Company Research and Advocacy: A Guide for Civil Society Organisations

The summary is excerpted from the resource.

Summary

The objective of this guide is to help civil society organisations (CSOs) use the Guiding Principles in their research, campaigns, engagement and advocacy towards companies and governments. By using the Guiding Principles in corporate research, campaigning, engagement and advocacy, CSOs can play an indispensable role as a countervailing power in confronting companies with their responsibility to respect internationally recognised human rights and ensuring they are held to account to meet their responsibility and improve their behaviour. Thereby, CSOs can contribute to making the Guiding Principles of real value for rights holders likely to be negatively affected by corporate activities.

Furthermore, by using the Guiding Principles in their research and advocacy and building up expertise, CSOs will be able to provide national and international authorities with useful insights in the strengths and weaknesses of the Guiding Principles, helping to improve the international business and human rights framework in due course.