Frequent Company Pushbacks
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Click through to see all 23 frequent company pushbacks and sample responses.
17. We have a long standing tradition of working with a respected NGO to review our supplier relationships. Why isn’t that enough?
Monitoring and auditing of supplier relationships are two elements of HREDD that underpin the responsible contracting system. Both in-house and external resources (e.g. NGOs) can play an important role in assessing the effectiveness of HREDD or HRE-related preventive measures. This form of (external) review, however, does little to move the contractual relationship toward the shared-responsibility model, which we believe is far more effective for preventing adverse HRE impacts than the traditional, risk-shifting, model. The move toward shared responsibility must be effectuated within the contractual relationship itself; the Toolkit was developed to help companies with this process. 18. Why should I be responsible for remediating harm that my company didn’t directly cause?
The UNGPs set out three distinct ways in which a business can be involved with adverse HRE impacts: causation, contribution, and direct linkage.[1] Businesses that cause or contribute to adverse impacts must cooperate with their suppliers and subcontractors to provide remedy to adversely affected stakeholders. Where the relationship between buyer and harm is attenuated, and a buyer is only linked to the harm caused or contributed to by a business partner, the buyer must use its leverage to try to make the business partner participate in the remediation process. The Clauses contained in the Toolkit offer template language that can be edited and adapted as needed to establish the shared responsibility of the parties to cooperate in carrying out HREDD, the duty of the supplier to disclose and report on adverse impacts, and the mutual commitment of the parties to prioritize victim-centered HRE remediation over traditional contract remedies, such as suspension of payment and termination.
[1] United Nations High Commissioner for Human RIghts, The Corporate Responsibility to Respect Human Rights: An Interpretive Guide, p. 15, https://www.ohchr.org/ sites/default/files/Documents/publications/hr.puB.12.2_en.pdf; Organization for Economic Cooperation and Development, Due Diligence Guidance for Responsible Business Conduct, https://mneguidelines.oecd.org/OECD-Due-Diligence-Guidance-for-Responsible-Business-Conduct.pdf 19. For what sectors is the responsible contracting approach relevant?
The Core Responsible Contracting Principles (joint commitment to cooperate in carrying out HREDD versus one-sided guaranties of perfection; shared responsibility for upholding HRE standards, including by engaging in responsible purchasing practices; prioritization of HRE remediation over traditional contract remedies) can be integrated into contracts for any type of transaction and any sector, but they may be particularly relevant in an upstream supply chain context and in sectors with significant power imbalances between the parties. Know the Chain, which benchmarks the implementation of HREDD concepts among companies, has tracked the uptake of responsible contracting in the apparel and footwear, food and beverage, information technology and communications sectors. The average score for companies across all sectors on “purchasing practices” is just 2 of 100, which means the vast majority of companies stand to gain a significant amount through the adoption of the Responsible Contracting Principles. 20. Do I have to adopt all of the model clauses?
No. Companies are encouraged to start by considering how the overarching Core Responsible Contracting Principles could be integrated into their contracts, codes of conduct, and business relationships as part of a broader HREDD process. Once that determination has been made, companies are encouraged to strategically and diligently select and adapt, rather than adopt or copy-and-paste, the model clauses that make the most sense for them. The model clauses contained in the Toolkit offer ready-to-adapt examples for how to translate the Core Principles into contractual language. The clauses are modular, acknowledging that one size does not—and should not—fit all. Each element of the Toolkit can be used together or separately. The model clauses include alternative text, with extensive footnotes, that provide counsel with research and resources that might be useful in making drafting decisions (e.g., clothing brands need no standards on conflict minerals, and electronics makers are not concerned with cotton sourcing). The clauses that are ultimately incorporated into contracts should be specifically tailored to address risks identified, which will vary from supply chain to supply chain and from company to company. The Responsible Contracting Project Team can advise on the implementation of the Toolkit, including by providing gap analyses between your contracts and the mandatory HREDD legislation. For additional resources, please see the Responsible Contracting Projects list of publications, events, and media. 21. I already have a hotline for reporting grievances. Do I have to adopt a new one?
Not necessarily. If the grievance mechanism you have in place is accessible, reliable, equitable, transparent, independent, and rights-compatible, it could be used to field concerns from workers and business partners. This mechanism should be accompanied by a robust response and remediation process, in which remediation undertaken to resolve concerns is documented in detail. The model clauses contained in the Toolkit offer some contractual language concerning internal grievance mechanisms and remediation processes. 22. My company has been asked to participate in so many industry initiatives. How does this differ?
There are several different initiatives that focus on the role that responsible sourcing plays in safeguarding human rights, including Better Buying, Higg Social and Labor Module, Know the Chain, and the Corporate Human Rights Benchmark. These initiatives either rate or measure companies on their performance on different metrics, including responsible sourcing, or serve as a forum for communication and collaboration between buyers and suppliers that are committed to human rights focused outcomes. The Responsible Contracting Project, the Core Responsible Contracting Principles, and the Toolkit occupy a distinct, complementary space in this framework. The Toolkit is intended as a practical, immediately-usable resource for businesses and, where applicable, their internal and external counsel, to align contracts with HREDD principles and requirements. While integrating the Core Responsible Contracting Principles and the model clauses can feed into positive evaluations or ratings for your company, the Responsible Contracting Project does not rate buyers or suppliers. Furthermore, as noted above, the model clauses are designed to be diligently and strategically selected, adapted, and tailored to the specific needs of each contractual relationship, not simply “adopted” or copy-and-pasted wholesale. 23. Are there companies already using the Toolkit and what have been their lessons learned and/or challenges?
You can find information about uptake of responsible contracting principles here. |
