Our key takeaway: Vulnerability play a central role in the context of climate change. On so many levels: vulnerability is one of the three drivers of physical climate change risk; vulnerability of a person or group increases the severity of the climate impact; and intersecting factors compound the risks for vulnerable people in the context of climate change. In this context, just transition and just resilience are key. Shift finds that support for people and communities negatively impacted by physical climate change has so far received relatively limited attention and has generally not been included in Just Transition discussions, which tend to focus on employment and job issues. Thus, they highlight the need for a just resilience, aka, addressing human rights impacts that may arise from responses to physical risks. The UNGPs can help companies advance on both the just transition and just resilience - in particular through its focus on effective engagement with potentially affected stakeholders and prioritisation of actions based on severity of impacts. To advance, companies can ask themselves two sets of questions - first on awareness and analysis of human rights risks in company responses to climate change, and second on integration of human rights due diligence into climate risk strategies.
Shift has published: ‘Climate Action and Human Rights: How the UN Guiding Principles can help companies respect human rights when responding to climate change’ (February 2023). This paper delves into how the UN Guiding Principles on Business and Human Rights (UNGPs) can provide a framework to help companies bring managing climate change and human rights risks together:
- The central role that vulnerability plays in the context of climate change: The report delves into how the level of vulnerability is one of the three drivers of physical climate change risk (alongside climate-related hazard and the level of exposure to climate hazards - according to the IPCC). In addition, there are a number of factors that increase vulnerability to climate impact, for instance, being a child, a woman, elderly, disabled, a member of an Indigenous and traditional community, or a worker. The report references IPCC reports to note that “[t]he heightened vulnerability of some people to climate change results from social, economic and cultural factors as well as from demographics, migration and employment patterns, not from climate hazards on their own.” In addition, “[p]eople who are marginalized … are especially vulnerable … regardless of the countries they live in.” Further, “[t]here are many intersecting factors that compound the risks for vulnerable people in the context of climate change. Low-income people are at risk of falling into extreme poverty if they experience repeated and successive climate events. Before they can recover from one disaster, they face another impact. The risk intensifies with factors like stagnant wages and rising costs of living.” The report notes that ‘business as usual’ can exacerbate vulnerabilities to climate risk for people. “Where companies fail to take account of the changed operating environment that climate change creates, their practices can decrease people’s resilience thereby increasing their vulnerability and ultimately resulting in higher climate risk.” For instance, the focus on living wage is amplified in the context of climate change: not paying a living wage places people at higher risk of other human rights impacts, and what used to be a living wage or living income in the past may not be a living wage/income in the future as the effects of climate change become more severe.
- The need for a Just Transition and Just Resilience: The report then demonstrates how companies may be connected to human rights impacts in the context of their responses to transition risk and physical risk and underscores the need for a Just Transition and Just Resilience. When considering the impacts of companies on people in the context of a transition to a low-carbon economy, the report provides three transition categories: (1) Transition out, (3) Transition in and (3) Transition to net zero. The report discusses the need for a just resilience, which is about addressing human rights impacts that may arise from responses to physical risks. The report defines just resilience as “the expectation that companies should respect human rights in the context of their adaptation action and in doing business in an operating environment that is changing as a result of climate change.” “[P]hysical climate change can have a range of human rights impacts. However, support for people and communities negatively impacted by physical climate change has so far received relatively limited attention and has generally not been included in Just Transition discussions, which tend to focus on employment and job issues.” The report discusses the inter-related nature of transition risk, physical risk and human rights impacts: “The business models, markets, sectors and locations of companies and their assets will (to some extent) influence whether individual companies are more exposed to transition risk or physical risk. For example, companies that are heavily dependent on agricultural commodities in their value chain, would be exposed to physical climate change risk as a result of lower agricultural yields and changing weather patterns.” “However, climate change is a complex systemic risk resulting from multifaceted chain reactions between ecological conditions and unpredictable political, technological, social and economic developments. This means that most businesses are likely to feel the effects of both physical climate change risk and transition risk.” The report finds that “[m]ost companies appear to be unprepared for the effects of physical climate change on their businesses directly or in their value chains. … Some climate impacts are becoming irreversible, clearly showing the urgent need for Just Resilience.”
- Leveraging the UNGPs to support the just transition and just resilience: The report finds that there are two key aspects of human rights due diligence which “enable companies to integrate respect for human rights into their responses to climate change and provide the key to holistic climate strategies.” First, through effective engagement with potentially affected stakeholders - which focuses on harm to people (as opposed to harm to business), and which requires ongoing engagement with affected stakeholders. “These two elements can play a critical role in helping companies understand and identify workable ways to address human rights impacts associated with responses to climate change.” Second, through the prioritization of action on the basis of the severity of risks to people. The report concludes with questions for companies looking to take a holistic approach to climate change and to integrate an understanding of risks to people’s human rights into their responses - focused first on awareness and analysis of human rights risks in company responses to climate change, and second on integration of human rights due diligence into climate risk strategies.
