Category Archives: News

How a handshake can hurt a company’s human rights record

The CEO of Nevsun, and the President of Eritrea

The growing importance of human rights to businesses

According to a recent BSR/GlobeScan survey, human rights are the single greatest sustainability concern for businesses. The Economist Intelligence Unit and UN Global Compact have also tracked growth in corporate concern about human rights.

The reason, as explained by business leaders themselves, because human rights touches every aspect of a business’s operations, and every dimension of a person’s welfare. It is, in the words of former UN Working Group on Human Rights and Business chair Margaret Jungk, “the essence of sustainability.”

The challenges that come with being “the essence of sustainability”

It is partly this all-encompassing nature of human rights that has made it so difficult for companies to manage. As the Wall Street Journal reported last week, companies struggle to locate human rights in any one department of their existing management structure. It is not well placed within the legal, community relations, human resources, security or environmental departments, but it has a role in all of those.

Likewise, companies have found it challenging to tackle a single human rights issue at a time (look at child labor in the cocoa industry – sparking outrage for 15 years now and a persistent priority for the likes of Hershey, Mars and Nestle).

Beyond those challenges, companies with complex business relationships face unique hurdles. Companies with large supply chains are increasingly held accountable for the human rights violations committed by their suppliers. Financial institutions are being asked to ensure that their loans and equity agreements do not violate human rights. Companies partnering with governments are called on to avoid being complicit in the human rights violations of the host states with which they do business.

How to make it easier for companies

Companies need a clearer way to identify the risks of their business relationships. This is a two-step process. First, they need a screening tool to identify the contexts and operations that, in their very nature, pose the greatest risk of implicating the company in human rights risks. Second, they need a risk assessment tool that can be carried out quickly and efficiently, and which incorporates the perspectives of rightsholders.

Human Rights Risk Assessment

We’ve been building these tools. The screen will come live as an app early next year. The Human Rights Risk Assessment (HRRA) tool will be out next month. What we’ve produced below is a “business person’s guide to HRRA.” It is directed at corporate actors concerned about human rights and business relationships. It explains the point and process of HRRA, so that companies can be informed and proactive in seeking the help they need from qualified human rights practitioners.

Have a read and tell us what you think: info@nomogaia.org

Trick or Treat? Palm Oil Makes Halloween Candy Both

a-strong-female-voice-in-a-company-community-grievance-mechanism-2

This week zoos have put out a warning to the fans of their primate exhibits – if you love Orangutans, make sure your Halloween candy isn’t ruining their habitat. Palm oil is now a major ingredient in candy. Unsustainably farmed, it increase forest fire risks and destruction of natural forests in the Orangutan’s native lands of Indonesia and Borneo.

But Orangutans aren’t the only ones affected by palm oil. Palm oil demand has exploded recently, and its production has been expanding across the globe. NomoGaia spent much of 2016 looking at palm oil in Liberia for a sense of how this expansion changes the risks (and opportunities) for palm oil as a responsible crop.

The good news:

There are no orangutans at risk in Liberia.

The bad news:

That might be part of the reason the major human rights risks of palm oil operations in Liberia are flying under the radar. Issues that have been flagged for the palm oil sector in Indonesia and Malaysia don’t necessarily apply in growing palm oil markets like Liberia, Nigeria and Cote d’Ivoire.

Examining the Humans at Risk: 

While piloting a methodology for Human Rights Risk Assessment, NomoGaia evaluated the risks of one particular plantation in Liberia: The Equatorial Palm Oil (EPO) plantation owned by Malaysia’s KLK palm oil company.

Risk assessment only looks at the risks of an operation, not the potential benefits, so the findings only reflect the actual and potential adverse outcomes of EPOs operations. The risks are many: wages for subcontractors are unlivable, housing conditions are unsanitary, working conditions are unsafe and troubled relations with communities have been soured by delayed implementation of promised benefits.

Read the risk assessment here, and contact us for more information if you’re interested!

epo-hrra-final-1

What do Child Soldiers, Peanut Butter and Dish Soap Have in Common?

A family in palm oil country

Palm Oil. In the past decade, Liberia has licensed 7% of its land (2,400 square miles — picture Delaware) to palm oil producers. Palm oil has been replacing canola in household products and processed foods, becoming the single most consumed oil in the world in 2012. Move over, canola.

Liberia was founded as a destination for America’s freed slaves, but recently it has been better known as the home of West Africa’s cruelest warlord and an epicenter of the world’s worst Ebola outbreak. All of these events have bearing on your kitchen.

Check the ingredients on your shortening, your potato chips, your “natural” peanut butter, your granola bars, even your dish soap. Palm oil is in everything and, increasingly, it’s coming from post-conflict countries like Liberia.

Liberia 3

Palm oil worker with a newly harvested “Fresh Fruit Bunch”

While the vast majority of palm oil is currently grown in Indonesia and Malaysia, the hunt for cheap labor and cheap land have led palm oil companies farther afield. In Liberia, companies can rent land for $1 a hectare (per year) and contract a workforce for $3-5 a laborer (per day).

Vice penned a massive takedown of the palm oil industry in 2014, noting its association to deforestation, violence and labor abuses.

But that’s only half of the story.

Last year, one of Liberia’s biggest palm oil plantation faced riots that saw a driver beaten unconscious, a plantation manager taken hostage and a minister (the president’s nephew, no less) smuggled out of the area in the trunk of a car. The cause? The plantation wasn’t expanding fast enough to increase employment to levels the community wanted.

People in some communities are literally rioting to give their lands away to palm oil producers. In Liberia, 84% of the population lives in extreme poverty (less than $1.25 per person per day). The wages at palm oil plantations equate to roughly that for a family of 4, but they come with health and education benefits, commitments to provide clean water and food, and stability that can’t be achieved for smallholders in rural Liberia, where access to markets is sometimes truly impossible.

Liberia 2

Palm oil worker filling a truck with “Fresh Fruit Bunches”

The riots and violence are also an artifact of the country’s troubled past. Both employees and jobseekers are often “ex-combatants”, since over 100,000 of Liberia’s young men fought in the wars (often as children). These include people who struggled to reintegrate into village life. As recently as 2006, a rebel army that called itself MODEL was occupying a palm oil plantation in Butaw.  They hadn’t bothered to register for ex-combatant support, because the UN program was underfunded and they were making a living processing “artisanal” palm oil – harvesting palm nuts, pounding them by hand, and boiling them in old motor oil barrels.

"Artisanal" palm oil processing -- how squatters make a living

“Artisanal” palm oil processing — how squatters make a living

In a context like this, is it possible to run an agribusiness rights-respectfully?

Mark has spent part of this year in Liberia, visiting the three largest palm oil producers in the country.

He has more.

The biggest threat to human rights in the sugar industry isn’t what you think it is

4O2A9769

How the commodities market is pummeling sugar rights holders

Sugar. It’s such a labor-intensive crop that it drove the slave industry in the Caribbean for decades. Even in the two centuries since then, sugar has been at the center of allegations of forced labor, child labor and deadly working conditions.

Belize is home to perhaps the world’s most ethical sugar supply chain. It is nearly 100% certified by Fairtrade, from seed planting through sugar refinement — and on to rum production and ice cream churning.

Belize’s sugar industry is not without its issues, but the labor challenges, pesticide controls, and capital flows are being addressed. Legions of rights advocates from the local labor associations, to the sugar mill, to Fairtrade auditors, to Ben and Jerry’s, to the Government of Belize itself are working shockingly diligently to address these issues.

No, here in Belize, the biggest threat to human rights is the commodities market.

Sugar world vs EU

Global sugar prices have been plummeting for three years, dropping from $0.30 a pound in 2011 to less than $0.13 today. Belize is being particularly hard hit, because it sells primarily to the European market, where sugar was selling at $0.40 a pound in 2011 (follow the blue line in the above graphic). This year it dropped to $0.23, but next year Europe’s market will align with the global market, as a trade agreement expires.

In the real world, that means that cane farmers need to plant, fertilize, manage, burn, cut and transport their cane to mills, and then mill and ship sugar with about a quarter of the operating margins they had just a few years ago. Imagine doing your desk job with 75% less internet, or time, or electricity – that’s kind of what Belizeans are facing right now.

4O2A9960

The tanking price of sugar is what threatens to undermine major advances in adequate wages, child schooling and the elimination of child labor. One farmer told me that his neighbors are pulling their children out of school because they can’t afford school fees right now. A woman whose son cuts cane and husband drives a cane loading vehicle says she stays up nights wondering how the family will survive.

So what can be done? Well, for one thing, pay more for sugar. In Belize, Fairtrade increases the value of sugar harvests by almost 150%. This money doesn’t (generally) go directly to farmers, but is designed to go directly to communities. When Fairtrade sugar was selling well, Belizean farmers were establishing scholarship programs at local schools, buying communal equipment to improve efficiencies in sugar production and distributing herbicides and fertilizers. Major sugarbuyers like Unilever, Coke, Pepsi and Nestle have a role here. So do consumers like you.

This doesn’t solve everything. One group not particularly assisted by Fairtrade payouts is the laborers hired by farm owners. These people do everything from operating machinery, to burning and cutting cane, to feeding migrant workers who travel to northern Belize for 6 months a year specifically for harvest. Helping them will require a wage boost – something that is impossible under current prices – or a transition from manual to mechanized labor, spreading the available wages among fewer workers.

Those aren’t easy fixes, but they’re not impossible either. NomoGaia will be heading back to Belize to follow up with the industry leaders that are working to make sugar production beneficial to everyone involved.