Company scorecards are out – and it’s a C for effort, and an E for impact

Anna Triponel

November 16, 2020

The 2020 Corporate Human Rights Benchmark, which ranks 230 global companies in five sectors on their human rights performance, finds that some companies are making some progress to meet their responsibility to respect human rights … but that the progress is failing to translate into improved performance on the ground. The automotive sector, which was ranked for the first time this year, is the worst performing sector ever in the CHRB with only 7 companies out of 30 scoring over 20%.

About the Corporate Human Rights Benchmark (CHRB)

  • The CHRB is an annual assessment and ranking of global companies on their human rights performance, both in terms of governance and in practice. The benchmark is produced by non-profit organisation World Benchmarking Alliance, which developed the CHRB methodology in collaboration with a global multi-stakeholder group of company representatives, governments, civil society organisations, investors, academics and legal experts. You can read more about the CHRB’s methodology here.
  • The CHRB assesses each company on performance across six differently weighted themes aligned with the UN Guiding Principles, including: (1) Governance and Policy Commitments; (2) Embedding Respect and Human Rights Due Diligence; (3) Remedies and Grievance Mechanisms (4) Performance: Company Human Rights Practices; (5) Performance: Responses to Serious Allegations; and (6) Transparency
  • The 2020 CHRB ranks 230 companies in five sectors with a high risk of adverse human rights impacts:
  • Agricultural products
  • Apparel
  • Extractives
  • ICT manufacturing
  • Automotive manufacturing (included for the first time in 2020)

Key takeaways from the 2020 Corporate Human Rights Benchmark:

  • Despite progress since previous benchmarks, CHRB pinpoints two overarching challenges across all sectors and companies:
  • First, “only a minority of companies demonstrate the willingness and commitment to take human rights seriously.”
  • Second, there is a “pernicious” disconnect between company policies and commitments, and their actual performance and results on the ground.
  • “The automotive sector is the worst performing ever in the CHRB,” with an average score of 12%. What’s more, two-thirds of automotive companies scored 0 across human rights due diligence indicators and the majority of companies have limited visibility on or engagement with supply chain actors.
  • “Too many companies are failing to meet investor expectations on human rights due diligence,” indicating “the need for regulatory action to raise the bar.”
  • Companies in all sectors improved their scores in two out of the 13 core indicators, on average, with the most improvement in public human rights commitments and external grievance channels. That said, human rights due diligence processes saw the least improvement.
  • Despite these improvements, CHRB identified a “concerning disconnect between these commitments and processes and impacts on the ground”: 104 companies faced at least one allegation of a serious human rights impact and 225 allegations were reported in total.
  • Further, “[c]ompanies engaged in a dialogue with stakeholders in less than a third of cases and provided effective remedy that was satisfactory to the victims in only 4% of cases.”
  • Besides the automotive manufacturing sector, the ICT manufacturing sector remains the lowest performing sector on average—though the sector overall has improved scores by around one-third since last year’s benchmark.
  • “Negative human rights impacts are overwhelmingly felt in developing countries.” Of the 225 allegations of severe human rights impacts, 85% occurred in developing countries even though 78% of the ranked companies are based in OECD member states. The most common severe impacts involved forced labour, child labour, or health and safety breaches ending in death or injury.
  • A just transition is undermined by a disconnect between human rights and climate issues. The automotive companies included in the 2020 CHRB were also assessed by the Climate and Energy Benchmark. When comparing both assessments, almost no correlation could be found between a company’s relative performance on either benchmark. In the coming decades, emissions-intensive sectors, such as automotive, face the major challenge of shifting to a net zero-carbon economy while upholding the central promise of the SDGs to leave no one behind.”

To see the full company rankings and scorecards in each sector, visit the Corporate Human Rights Benchmark 2020 portal. For additional summaries and key insights, read the Corporate Human Rights Benchmark: 2020 Key Findings summary report. You can also find each company’s individual scorecard here.

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