The benchmark assesses 98 of the largest publicly traded companies in the world on 100 human rights indicators. These are all from high-risk industries – agricultural products, apparel and extractives. The aim is for the analysis to grow to cover 500 global companies.
BHP Billiton, Marks & Spencer Group, Rio Tinto, Nestle, Adidas and Unilever were among the small group of leading performers. Costco Wholesale, Macy’s, Grupo Mexico and Yum! Brands are among the much larger group with lower scores.
The Benchmark examined companies’ policies, governance, processes, practices, and transparency, as well as how they respond to serious allegations of human rights abuse. This was done by scoring the companies on 100 indicators across six measurement themes.
The analysis found that a small number of companies emerged as leaders scoring between 55-69%, but the results skewed significantly to the lower bands. A clear majority, 63 out of 98 companies, scored below 30%.
The Benchmark is led by investors and non-profit groups. Their hope is that investors will use the CHRB’s results in their analysis of companies and investment decision making, including the identification of key human rights risks to discuss with management.
The successful companies will have lowered their exposure to potential legal, reputational and financial risks that could arise from human rights abuses. The benchmark creators also believe that the ranking also paves the way for governments to use a smart mix of regulation and incentives to enhance transparency and minimum standards of corporate behaviour to make the business case for the respect of human rights.
Vicky Dodman, Chief Executive of the Corporate Human Rights Benchmark, said: “This first Benchmark is a baseline. In the future, we want to see companies move up as they respond to increased public scrutiny and engagement from investors. Inaction runs a high reputational risk and low scoring companies should act decisively, learn from leading practices, and rapidly improve.”