Yes, this is a tough one—but it's absolutely essential!
First, let’s name the dynamic here.
Human rights due diligence is premised on meaningful engagement with stakeholders - with a priority placed on engaging with potentially affected stakeholders (i.e., those whose rights could be impacted by the business).
This of course makes sense: how can a company really know about where it may have impacts on people’s human rights if it doesn’t hear from the people themselves who could be impacted!
There is a prioritisation baked into the UN Guiding Principles to help companies prioritise their efforts. Companies can prioritise the stakeholder engagement based on where the risks to people’s human rights are viewed as being the most severe to them - and the most likely - to happen. (Cf. also the risk-based due diligence called for under the EU CSDDD)
The people to be engaged with are the potentially affected stakeholders themselves - or their credible representatives (e.g. trade unions, community representatives). Where this engagement is not possible, companies can engage with proxies - people who have insights into the stakeholders’ lived experiences and can speak to the impacts (but they do not purport to represent them and shouldn’t be expected to). Where this is not possible, companies can engage with credible experts such as civil society organisations and other experts.
See our ‘Onion of Stakeholder Engagement’ diagram below for more on the order of prioritisation of stakeholder engagement under the UN Guiding Principles.
And meaningful engagement means a number of things.
It means genuinely listening and being open to what stakeholders have to say. It means providing sufficient information upfront to make the most of the engagement. It means taking measures to redress the imbalance of power between those engaging and those being engaged with. It means catering for language and other barriers to exchange. It means engaging on the adverse impacts. And it means providing feedback on how stakeholder inputs have been taken into account by the company.
So this is the expectation.
This all sounds well and good. But in practice, we see that meaningful engagement with rightsholders really is a tricky one for companies to navigate.
We’ve seen five challenges come up again and again for companies:
1) The scope: There could be hundreds, no, thousands of people in a company’s value chain whose human rights could be impacted. And all of these people are in scope for a company’s human rights due diligence. Even when applying prioritisation filters, a large company is still likely to end up with a large number of potential people in scope to prioritise for meaningful engagement.
2) The logistics: In practice, a number of the impacted people that will be prioritised for engagement will be in a company’s value chain. It can be a challenge to navigate this engagement logistically - we know how challenging, we’ve done a lot of it! Suppliers may not want to provide access to their workers. They may agree but then they coach their workers. And this is tier 1 suppliers. For those suppliers beyond, companies will need the engagement and buy-in from their tier 1 supplies to provide the relevant information (unless they are conducting what we call ‘leap-frog’ engagement and go to the source without engaging the layers in between).
3) Restrictions to worker voice and trade unions: In an ideal world, companies would have trade unions and worker representatives that they can rely on to raise impacts in their value chain (to their suppliers/ buyers). These trade union leaders and worker representatives would be empowered and equipped to raise issues that workers are raising, and there would be a virtuous flow of meaningful engagement and information. However, this is not what we tend to see happen on the ground - for a range of reasons (too long to delve into here).
4) Resource constraints: Human rights leads in companies are (often) already scrambling with many different things on their plate to advance on human rights due diligence. So they have limited time to engage themselves. They can pay for help - but even then, resources (both time and money) are limited.
5) The safety: Retaliation against stakeholders is real. People who have shared issues as part of stakeholder engagement can find themselves without a job, or pushed to the side. See an excerpt from our internal way of working doc on stakeholder engagement below for more on this.
And yet, meaningful stakeholder engagement is so critical to human rights due diligence. It is a feature of human rights due diligence which acts as a foundation to everything else.
So how then can companies navigate this?
Here are some approaches to consider that can be combined with other ideas. These are not mutually exclusive:
- Incentivise and support suppliers to conduct their own meaningful engagement: In an ideal world, your suppliers would be conducting their own meaningful stakeholder engagement as inputs into their own human rights due diligence. Of course, in practice, we know that a number of them are still getting up to speed with the idea of conducting human rights due diligence, let alone conducting meaningful stakeholder engagement. It can feel very uncomfortable to open yourself up to feedback from your workers or other stakeholders. But companies can play a role in helping to shift this mindset and push suppliers to engage themselves with their workers. Examples we’ve been involved with: rolling out guidance notes on meaningful stakeholder engagement to suppliers; coordinating supplier forums amplifying sharing of meaningful examples amongst suppliers; incentivising meaningful stakeholder engagement through business incentives; modelling stakeholder engagement with a high-risk supplier; organising change management trainings that go to the root of why engagement is not taking place; supporting suppliers with lower hanging fruit engagement models (e.g. tapping into and extending existing processes such as small worker meetings).
- Partner with trade unions and human rights organisations: Trade unions fall in the ‘proxy’ category of the Onion of Stakeholder Engagement. The more we can build voice from the ground so that the engagement takes place on a continuous basis, the better. For instance, companies we work with who have Global Framework Agreements (GFA) with trade unions (where the scope extends to the supply chain) show us the kind of data that comes up pro-actively from the GFA which is grounded on worker engagement conducted by trade union leaders themselves in-country. This yields really valuable info, is a huge time-saver, resource-efficient, and can get you much more meaningful information than other methods. We’ve also seen companies enter into partnerships with civil society and human rights organisations with local presence close to sites where their supply chains are operating. Not the same as engagement but this can help to get a sense of issues arising to then target engagement efforts accordingly (some of which can be light-touch).
- Conduct sector-wide HRIAs: We are seeing a rise in sector-wide human rights impact assessments (HRIAs). These sector-wide HRIAs work by including the company’s supplier/ group of supplier, and their own suppliers. This HRIA is squarely positioned as a benefit to all companies involved in that they will find out about the kinds of human rights issues that less in-depth tools such as audits and questionnaires wouldn’t uncover, and work together to address them. The parent company may finance it for the supply chain - on the understanding that there would be co-ownership of the actions taken. You rely on meaningful stakeholder engagement as under any well-designed HRIA, and you get access to potentially affected stakeholders since there is buy-in from the supply chain. At the same time, you get access to a much larger number of worksites so you get a more more breadth in the engagement. We just did one of these in India and were able to conduct stakeholder engagement with a very large number of workers in a relatively short period of time because of the high buy-in from suppliers.
- Use the likelihood factors to prioritise carefully: The likelihood of impacts arising depends on what we call ‘likelihood factors’: the nature of the activity, the presence of vulnerable people, the relationship with the company’s business partner, the operating context and the strength of existing mitigation measures. Companies can use these likelihood factors to focus their engagement on a small number of contexts that are at particular risk. For instance, they may prioritise one high-risk country where they have many migrant workers - decide to travel there and conduct as much engagement as possible. In our experience, meeting with management of suppliers and providing the right conditions for them to raise the issues that they are also seeing - including how they are managing their business - can also provide very valuable information, especially if managers know they can raise purchasing practices and be open and honest about what goes on on site without retaliation (i.e.g, loss of the business).
At the end of the day - keep in mind the objective of stakeholder engagement under the UNGPs: to understand where the adverse human rights impacts are, where they may be the most severe from the people’s perspectives, and how stakeholder themselves would envision action be taken to address these impacts.
Don’t let ‘perfect’ be the enemy of the good. The more you are going for scale with stakeholder engagement, the more challenging it will be for you to guarantee that it stays meaningful. Advance to extend the stakeholder engagement - but watch out to not dilute it too much so that we lose the ‘meaningful’ qualifier.
“Remember that following stakeholder engagement, we return to our work back home. However, the people we have engaged with remain in their jobs, in their realities and in their contexts. By its very definition, they are in vulnerable positions – they may be on low wages, they may be migrant workers, and/or they may be from a group that is traditionally discriminated against. We need to at all times place ourselves in their shoes, and consider the best approach to mitigate the risks that they may live – as a result of our engagement.
There may be times where considering the people we leave behind following engagements will lead to us needing to take a different approach to the HRIA. This may at times come to the detriment of the information gathered. Safety of the individuals we engage with should always prevail, even if it means that we gather less helpful information for a particular client. We expect certain mitigation expectations to be in place for all HRIA processes.”
Excerpt from ‘The Human Level Way of Working: Our Approach to Stakeholder Engagement’ (2023)
