The 14 Red FlagsThe 14 Red Flags are warning signs that a social certification may not be a reliable indicator of corporate performance. The flags are grouped into five key themes:
Notes for using this checklist: Use the checklist to assess an initiative against each 14 Red Flag. Click into each flag to explore: What it means, Why it matters for investors, and What to look for. All red flags are equally important. No single issue can be ignored without increasing risk. That’s why it's essential to assess a certification scheme against all 14 flags for a complete picture of its credibility and effectiveness. This tool applies to all MSIs —whether or not they offer certifications. Throughout the tool, we use the term “member” to refer broadly to:
The tool refers to rights holders throughout - in other words, the individuals or groups whose rights the initiative is seeking to uphold. Who gets defined as a “rights holder” may be MSI-specific. For example, a scheme designed to address labor conditions in agriculture may consider smallholder farmers as well as farmworkers as rights holders, whereas another scheme may be designed only to address the conditions for farm workers. An investor should refer to the scheme to understand its target population. Alignment with International Standards1. No Explicit Commitment to International Human Rights Standards or Covers Some but Not All Salient Human RightsDoes the adhering entity reference either the UN Guiding Principles on Business and Human Rights (UNGPs) or the OECD Guidelines for Multinational Enterprises (MNE) on Responsible Business Conduct?
❐ Yes ❐ No ❐ Partially Does the initiative indicate that it conducts a saliency assessment or requires adhering entities to conduct saliency assessments to determine and prioritize the most severe impacts associated with the sector, product (including raw material components), or high-risk location? ❐ Yes ❐ No ❐ Partially 2. No Explicit Role for Rights Holders in Standard SettingDoes the initiative provide an explicit role for affected rights holders in the development and subsequent revisions of the standard?
❐ Yes ❐ No ❐ Partially Scope3. No Requirement of Brands to Share Responsibility with SuppliersDoes the initiative require the adhering entity to take responsibility for impacts occurring throughout its operations?
❐ Yes ❐ No ❐ Partially Good practices include, but are not limited to:
4. Does Not Adequately Account for Vulnerable PeopleDoes the initiative identify the most vulnerable workers and communities, or consumers in their operations and center prevention of harm to them in their standard and guidance?
❐ Yes ❐ No ❐ Partially Good practices include but are not limited to:
5. Does Not Adequately Account for GenderDoes the initiative apply a gender lens in designing the standard and establishing procedures for conducting audits?
❐ Yes ❐ No ❐ Partially Signs of a gender lens include, but are not limited to:
Audits6. Allows the Company or Supplier Being Audited to Pay Directly for and/or Choose the AuditorDoes the initiative have a credible firewall to insulate auditing from conflicts of interests?
❐ Yes ❐ No ❐ Partially A firewall can be created through, for example:
7. No Requirement for Auditors to Have Human Rights Competencies and Knowledge of the Local ContextDoes the initiative require auditors to have human rights competencies or training requirements?
❐ Yes ❐ No ❐ Partially Human rights competencies include, but are not limited to, knowledge of:
8. Audits Not Carried Out in Person, Among Other Procedural WeaknessesDo the initiative's audit procedures include all of the following:
❐ Audits conducted onsite ❐ A rationale for when announced and unannounced audits are conducted ❐ Interview protocols to protect rights holders from reprisal ❐ Requirements for audit coverage – i.e., the percentage of workers or community members interviewed per site and the percentage of audited sites ❐ Ongoing monitoring after the audit to prevent retaliation or other adverse consequences for audit participants. Does the initiative require that adhering entities publicly report on their process for identifying audit errors, instances of corruption, and efforts it makes to rectify these problems? ❐ Yes ❐ No ❐ Partially 9. Audit Passed on a Non-representative Sample or Insufficient Sample SizeDoes the initiative provide requirements and/or clear guidance for the adhering entities' sampling methodology?
❐ Yes ❐ No ❐ Partially Are adhering entities required to procure a larger percentage of their supply product from certified suppliers over time? ❐ Yes ❐ No ❐ Partially Grievance Mechanisms10. No Grievance Mechanism at the Initiative Level and/or No Requirement for a Grievance Mechanism in the StandardDoes the initiative require adhering entities to have a complaints mechanism that meets the effectiveness criteria established in UNGP 31?
❐ Yes ❐ No ❐ Partially Does the initiative require adhering entities to report on how often the complaint mechanism is used? ❐ Yes ❐ No ❐ Partially Does the initiative itself have a grievance mechanism that is used and does it report on how often it is used? ❐ Yes ❐ No ❐ Partially 11. No Controls to Ensure Grievance Mechanisms Provide Effective RemedyDoes the initiative require grievance mechanisms of adhering entities to have the following features? Select all that apply.
❐ Rights holders participation in the design and implementation of the mechanism ❐ Guidelines for providing remedy ❐ Safeguards against repetition ❐Publicly available complaints and resolution Governance & Accountability12. No or Poor Communication of the Initiative Standard and Requirements to All StakeholdersDoes the initiative require adhering entities to clearly communicate the purpose and expectations of the initiative to all actors throughout the supply chain?
❐ Tier 1 ❐ Tier 1 and 2 ❐ Beyond tier 2 ❐ Initiative has no such requirement 13. No Process to Suspend or Withhold Membership or Certification until Corrective Action Plans are Adopted and ImplementedDoes the initiative have a clearly defined process to hold adhering entities accountable when significant deviations from the standard are identified, including revoking certification compliance when appropriate?
❐ Yes ❐ No ❐ Partially Are there public complaints levied against the initiative for not following the procedures for suspending and withholding certification? ❐ Yes ❐ No ❐ Partially 14. Does Not Make Information on Audits, Complaints, or Compliance PublicDoes the initiative require adhering entities to publicly disclose their audits and remedial action plans? ❐ Yes ❐ No ❐ Partially |
This project is a collaboration among the following organizations:
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Copyright © 2024