Ron Popper has more than a decade of hands-on experience leading human rights efforts at the corporate level. He was Head of Corporate Responsibility at ABB Group, focusing on due diligence, capacity building and engagement with community partners, including communities, suppliers and investors, in various parts of the world until his retirement in 2016.
Among other current human rights positions, he co-chairs the Steering Group of the Global Business Initiative for Human Rights (GBI) and lectures on corporate responsibility.
Ron Popper is a former writing and radio journalist working for 25 years in the UK, Middle East and Switzerland.
He will participate in the “Business Talks about Human Rights” forum, organized by the Bulgarian Foundation for Business and Human Rights, of which ESGnews.bg is a media partner. The event will be held on June 26, 2024 from 9:30 a.m. to 1:30 p.m. in The Steps, Sofia, and participation is free after prior registration.
See what Ron Popper previously told ESGnews.bg before his arrival in Bulgaria:
Mr. Popper, how does the Global Business Initiative on Human Rights (GBI) support companies to embed human rights into their operations?
We have been working with some of the world’s largest multinationals since 2009 to support their efforts to strengthen their performance on human rights. We are a cross-sectoral initiative, working globally, which brings together senior company practitioners in a confidential setting to exchange practical examples of what initiatives, tools, training and due diligence practices work, what doesn’t, and to share the daily challenges that companies face in implementing respect for human rights in their business activities. GBI has built up a wealth of practical knowledge in the past 15 years and both supports and challenges members in improving performance. In the final analysis, of course, it is their own decision on what they do.
What are the biggest challenges businesses face in respect of human rights? How can they be helped to address them?
There are many challenges. The first is to demystify human rights – it’s quite simple really: It’s about how we treat human beings in our business activities. Do we treat them with dignity and respect ? And it’s about “doing no harm” as a business. The main challenge is for businesses to know how their activities impact the lives and rights of people. This can only be done through having the right policies and processes in place, driven by the senior management, and by investing in and carrying out due diligence to understand potential or actual negative impacts, and how to prevent, mitigate or, where necessary, remediate those harms.
One of the biggest challenges is getting companies to do this consistently and effectively throughout their operations and value chain. Companies need to understand that human rights is everywhere in a business – not only in their extended supply chain, but also in their own operations. Rights issues may be very close to home. What is produced and how? Working conditions and (excessive) overtime? Is there discrimination (gender, racial, religious etc. in our own workforce? Are we aware of potential modern slavery in our midst? Can products be misused by customers? Who owns the land bought or leased for production? Under what conditions are our goods transported and stored? However, companies cannot tackle all of this at once. There is a lot of good, simple advice available on breaking down and prioritising the most pressing human rights risks as a first step.
Getting a holistic understanding of risks and ways of mitigating them requires understanding and input from many parts of the company: business managers, human resources, and legal among others. Senior management buy-in is essential to driving the agenda throughout the business. There needs to be an understanding that failure to respect human rights can have legal, financial and human consequences which not only damage people but also the company’s social license to operate and ability to continue business.
How do you support your members to build capacity to respect human rights throughout the company’s operations?
At GBI we deal with a variety of practical issues – some of them everyday and some extremely complex. Based on our own business experience and through speaking to member companies regularly, we identify the key issues that are keeping them awake at night. These can include relatively common challenges such as how to ensure that workers’ rights are respected in operations, due diligence in the supply chain, what constitutes an effective grievance mechanism, how to break down internal company barriers blocking human rights work, and how to carry out human rights training and with whom in the company. Then we work through highly complex issues: These include, for example, how to navigate diverging national and international legislation and standards (for example over working hours), what effective due diligence looks like both in upstream and downstream relationships, how to work in complex or conflict-affected environments, and how to withdraw from authoritarian or conflict-ridden countries in a human rights-aware manner. Difficult issues.
Why is respecting human rights good for business?
There is plenty of upside if your company is known for respecting human rights: Customers are more likely to want to partner with a company with a strong reputation for being a decent, reliable company that respects people and laws. Investors are increasingly taking human rights performance (the main component of the S in ESG) into account, along with environmental and governance track records, and are more likely to support strong ESG performers. On the downside, exploitation of people to cut costs will lead to ill health (both physical and mental), over-tiredness, health and safety risks, mistakes, absenteeism, and potentially an inability to fulfil business contracts or to the required standard. This impacts business continuity and resilience. Getting human rights wrong can have legal consequences, a loss of confidence among investors and business partners, and negative media consequences. It can also hamper your ability to attract and retain the brightest and best talent.
I have visited many factories in different parts of the world. Some are top notch; others are in a very bad state: cramped conditions, an intimidated workforce, over-tired employees, poorly maintained machinery, little or no personal protective equipment, bad air, chemical spills on the ground, blocked fire exits and so on. You just feel that such a company cannot last long. Their prices may be low but many international companies, now facing increasing scrutiny, are starting to alter their buying and relationship criteria.
How important is meaningful stakeholder engagement to corporate human rights responsibility?
How does a company know what its employees, suppliers and the people who are impacted by its operations want and need if it doesn’t talk and listen to them? It’s an essential element of risk management. An infrastructure project should benefit local people, as well as the companies involved. But over the years visiting projects in many countries, I have seen how a lack of effective stakeholder engagement and buy-in to infrastructure projects has alienated local communities, including vulnerable people and indigenous communities, led to losses of natural habitat and key resources, such as land and water, and sometimes resulted in violent opposition and delays to the project itself. All this because proactive identification of and communication with key stakeholders was not carried out early or conducted seriously.
The need for stakeholder engagement is increasingly being embedded in law and reporting requirements. Stakeholders are central to the double materiality assessment enshrined in the EU’s Corporate Sustainability Reporting Directive (CSRD), introduced this year, and great emphasis is placed on stakeholder engagement. A key point in the new Corporate Sustainability Due Diligence Directive (CSDDD) stipulates that as part of their due diligence, companies should carry out meaningful engagement including a dialogue and consultation with affected stakeholders. Serious stakeholder engagement should never have been a “nice to have”; it is no longer optional.
What role does due diligence play in ensuring that corporations respect human rights?
Due diligence is essential to understanding your impacts – positive and negative – and your risks to people and the environment. Many companies already do due diligence – legal, financial, for new ventures and acquisitions, acquiring land and so on. It’s not new or that difficult: It just needs to be done in a consequent manner. It’s fundamental to efforts to prevent, mitigate or redress human rights harms which is why it’s a central element of new laws in the European Union and elsewhere, as well internationally recognized UN and OECD standards.
How can businesses be more transparent and accountable for their human rights violations, and why is corporate accountability so important in this context?
Companies need to put internal processes in place, appropriate to their size and potential impacts, under which they are able to foresee and know what their impacts are, and feel confident in reporting on them. Corporate accountability is the stick which is being increasingly wielded to ensure that laggards – and there are still many in different parts of the world – realise there are consequences to poor performance on human rights and the environment.
Laws and international standards place strong emphasis on companies remediating any wrongs; increasingly we are seeing companies being held to account in courts of law for wrongs they cause, contribute to or are directly linked to. Companies make mistakes, they are fallible. What is important is that they put them right, wherever possible, and learn from them. More and more businesses are being held to account not only in courts of law, but also by key stakeholders such as ESG investors, affected communities, trade unions, civil society, employees, and mainstream and social media. In a 24/7 media world, there is no place to hide for companies that make mistakes, fail to remediate them or learn from them.
What is the relationship between corporate responsibility for human rights and sustainable development, and how can businesses actively participate in achieving the UN’s Sustainable Development Goals?
A study of the Sustainable Development Goals showed that human rights issues underpin over 90% of the 17 SDGs. In other words if companies focus on advancing their own human rights performance they will in any case be making valuable contributions to the realization of the SDGs. Businesses may also identify where they can place their emphasis, based on their resources, skillsets and experience, in supporting and advancing individual goals. It may well be best to place emphasis on just one or two areas where an effective contribution can be made. All genuine contributions are valid and welcome. Where I have a problem is when companies try to pass off their business-as-normal activities as major contributions – this is the SDG equivalent of “Greenwashing”.
What will be the impact of the CSDDD on businesses in Europe? Is there an overlap between CSDDD and CRSD?
It would take considerable time to go through the two new laws, but suffice it to say that both pieces of legislation will have a major impact on large companies within the EU and smaller companies supplying to them in terms of the need to strengthen human rights and environmental due diligence and performance.
The CSRD is already in force this year for large companies, and I have heard of many of them having cross-functional and business teams of up to 60-70 people working to consolidate information for when reporting becomes due as of January next year. The somewhat diluted CSDDD, which passed its final hurdle in May, now has to be transposed into countries’ national law in the EU and will be phased in from 2027 onwards.
Companies already reporting under CSRD will not need to duplicate those reporting requirements under CSDDD but they will need to describe in detail how they implement due diligence under the CSDDD. If a company is submitting a climate transition plan under CSRD it will not need to duplicate this for CSDDD.
Where the CSRD requirements stand out is the need to cover a double materiality assessment of the company’s activities (impact and financial materiality), and due diligence needs to cover both upstream and downstream activities.
In summary, these new laws – and others such as the EU Forced Labour Regulation – are going to force companies, large and small, to approach human rights and environmental due diligence in a much more focused and detailed manner. They should have been doing so in any case under the United Nations Guiding Principles on Business and Human Rights (2011) and the OECD Guidelines for Multinational Companies on Responsible Business Conduct. But now such standards are becoming hard law.
It may be tempting to think that smaller companies will not be covered. This would be an error. Even if smaller companies are only part of a supply chain, their human rights and environmental data will be needed by their larger customers for them to report completely and accurately. Failure to provide such information may lead to smaller companies being delisted.
So even if the CSDDD has its limitations, we are now living through a period of major change – and the hope is that not only will it improve companies’ human rights and environmental performance but also respect for the rights of very many employees, migrant workers, vulnerable groups and affected communities in Europe and beyond.
