Georg Kell
Executive Director, UN Global Compact

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Businesses have several reasons to commit to respect and support human rights. While some businesses approach human rights from a pure compliance perspective, limiting their actions to what the law requires, self-enlightened business leaders increasingly embrace a broader risk management perspective that goes beyond minimum legal requirements. This is especially so where legal requirements do not live up to international standards.

These self-enlightened businesses often see respect for human rights as a key part of sustainability. The most advanced businesses are those that are also aware of the business benefits that respect and support for human rights can bring. Benefits include development of improved products and services as well as access to new markets and customers.

Other elements of the business case include securing and maintaining a social license to operate, building and maintaining good relationships with local communities and other stakeholders, brand differentiation, enhanced ability to attract and retain the best staff, morale based productivity improvements, a universal framework that can help balance competing interests and enhanced reputation. In addition, human rights scandals can be very costly.

In recognition of the cost savings and other business benefits of respecting and supporting human rights, there is also the trend that financial markets are increasingly rewarding companies that are proactively and effectively managing human rights and other dimensions of social, environmental and governance risk. Such companies often seem to be better managed overall and are better able to adapt to change.

Just as businesses are responsible for their financial performance, they are also responsible for their social and environmental performance. The baseline expectation of business is that it will respect — that is, not harm — human rights. If a business causes the harm, society increasingly expects the business to be responsible for providing redress. Similarly, if a business is at risk of its activities causing harm, society increasingly expects that the business will manage that risk to prevent the harm from occurring. Exercising due diligence to identify, address and manage human rights risk will help business to respect human rights, including avoiding complicity in human rights abuse.

There are several challenges for business as respect for human rights are becoming an expectation and business opportunity. One of the first challenges to overcome is the fear that so many businesses have of human rights. Such fear often seems to be grounded in lack of understanding around what human rights are, lack of clarity in scope, relevance to business and what, in practical terms, business can do to address human rights issues.

Focusing on concrete steps that business can take to create practical solutions to human rights dilemmas is one way to help address the fear that some business have about human rights. Sharing real life examples of how some businesses have turned support for human rights into opportunities goes a long way towards showing how human rights can be an opportunity and not just a risk to be managed.

To address this business fear through real life examples, the UN Global Compact came out with a publication called Embedding Human Rights in Business Practice II. The resource contains case studies of companies supporting and respecting human rights. Links to practical guidance materials that can help businesses manage risk and identify opportunities to advance human rights are available on the UN Global Compact human rights tools and guidance page.