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Social Compliance and Auditing

Social Compliance and Auditing
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ABSTRACT: “The failure of governments to protect workers’ rights in the global economy has left a yawning gap of regulation and helped spawn an $80 billion industry in corporate social responsibility (CSR) and social auditing. Yet the experience of the last two decades of “privatized regulation” of global supply chains has eerie parallels with the financial self-regulation that failed so spectacularly in 2007 and plunged the world into deep and lasting recession. This detailed and extensive report by the AFL-CIO reveals just how bad much of the CSR industry has been for working people. Not only has it helped keep wages low and working conditions poor, it has provided public relations cover for producers whose disregard for health and safety has cost hundreds of lives. The AFL-CIO research underscores the central failing of the CSR model, which is based mainly on short and cursory visits to factories and no proper discussion with workers. This, coupled with the big global brands holding on to the “Walmart” model of driving prices to local producers ever lower and demanding ever-faster production, the dominant social auditing model will never achieve decent, secure jobs for the millions of workers at the sharp end of the global economy.”

ABSTRACT: “Over the past two decades multinational corporations have been expanding ‘ethical’ audit programs with the stated aim of reducing the risk of sourcing from suppliers with poor practices. A wave of government regulation—such as the California Transparency in Supply Chains Act (2012) and the UK Modern Slavery Act (2015)—has enhanced the legitimacy of auditing as a tool to govern labor and environmental standards in global supply chains, backed by a broad range of civil society actors championing audits as a way of promoting corporate accountability. The growing adoption of auditing as a governance tool is a puzzling trend, given two decades of evidence that audit programs generally fail to detect or correct labor and environmental problems in global supply chains. Drawing on original field research, this article shows that in spite of its growing legitimacy and traction among government and civil society actors, the audit regime continues to respond to and protect industry commercial interests. Conceptually, the article challenges prevailing characterizations of the audit regime as a technical, neutral, and benign tool of supply chain governance, and highlights its embeddedness in struggles over the legitimacy and effectiveness of the industry-led privatization of global governance.”

ABSTRACT: “Recent advances in the science and technology of global supply chain management offer near-real-time demand-response systems for decision-makers across production networks. Technology is helping propel “fast fashion” and “lean manufacturing,” so that companies are better able to deliver products consumers want most. Yet companies know much less about the environmental and social impacts of their production networks. The failure to measure and manage these impacts can be explained in part by limitations in the science of sustainability measurement, as well as by weaknesses in systems to translate data into information that can be used by decision-makers inside corporations and government agencies. There also remain continued disincentives for firms to measure and pay the full costs of their supply chain impacts. I discuss the current state of monitoring, measuring, and analyzing information related to supply chain sustainability, as well as progress that has been made in translating this information into systems to advance more sustainable practices by corporations and consumers. Better data, decision-support tools, and incentives will be needed to move from simply managing supply chains for costs, compliance, and risk reduction to predicting and preventing unsustainable practices.”

ABSTRACT: “The purpose of this paper is to investigate the intended and unintended consequences of compliance and auditing pressures in the Bangladeshi garment industry. To explore this issue the authors draw on three medium-sized suppliers. The institutional changes that followed the Rana Plaza accident in April 2013 make Bangladesh in general and the garment industry in particular an interesting and suitable research setting for standards compliance…. The results indicate that the pressure for compliance has led the case companies to prioritise the implementation of measurable standards over the socially grounded needs and priorities of workers. As a consequence certain initiatives instead of adding new social value in fact destroyed previously existing social value. Furthermore, the pressure for compliance created the necessity to find ways to cover the sizable cost of compliance. This prompted firms to pursue process upgrading through technological advancements and increased work pressures on the labour force. These initiatives led to an increased power imbalance and the exclusion of unskilled workers from the job market.

ABSTRACT: “Firms seeking to avoid reputational spillovers that can arise from dangerous, illegal, and unethical behavior at supply chain factories are increasingly relying on private social auditors to provide strategic information about suppliers’ conduct. But little is known about what influences auditors’ ability to identify and report problems. Our analysis of nearly 17,000 supplier audits reveals that auditors report fewer violations when individual auditors have audited the factory before, when audit teams are less experienced or less trained, when audit teams are all-male, and when audits are paid for by the audited supplier. This first comprehensive and systematic analysis of supply chain monitoring identifies previously overlooked transaction costs and suggests strategies to develop governance structures to mitigate reputational risks by reducing information asymmetries in supply chains.”

Social Impact Assessment

Social Impact Assessment
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ABSTRACT: Social impact assessment (SIA) is now conceived as being the process of managing the social issues of development. There is consensus on what ‘good’ SIA practice is – it is participatory; it supports affected peoples, proponents and regulatory agencies; it increases understanding of change and capacities to respond to change; it seeks to avoid and mitigate negative impacts and to enhance positive benefits across the life cycle of developments; and it emphasizes enhancing the lives of vulnerable and disadvantaged people. We analyse the strengths, weaknesses, opportunities and threats facing SIA. We assert that the SIA community needs to revisit core concepts, such as culture, community, power, human rights, gender, justice, place, resilience and sustainable livelihoods. It is incumbent on SIA practitioners to educate proponents, regulators and colleagues about these concepts, and to embed them into practice norms. Stronger engagement with the emerging trends of free, prior and informed consent (FPIC); human rights impact assessment; social performance standards; supply chain management; governance; local content and economic development will improve the relevance and demonstrable value of SIA to all stakeholders.”

ABSTRACT: “The “International Principles for Social Impact Assessment” is a statement of the core values of the SIA community together with a set of principles to guide SIA practice and the consideration of ‘the social’ in environmental impact assessment generally. It is a discussion document for the impact assessment community to be used as the basis for developing sector and national guidelines. In the process of being developed explicitly for an international context, increasing pressure was placed on the conventional understanding of SIA and a new definition, with official imprimatur of an international professional body, has been formalised. “Social Impact Assessment includes the processes of analysing, monitoring and managing the intended and unintended social consequences, both positive and negative, of planned interventions (policies, programs, plans, projects) and any social change processes invoked by those interventions. Its primary purpose is to bring about a more sustainable and equitable biophysical and human environment.”

  • Vanclay F (2014) Developments in Social Impact Assessment: An Introduction to a Collection of Seminal Research Papers. In: Vanclay F (ed) Developments in Social Impact Assessment. Edward Elgar: Cheltenham.

ABSTRACT: N/A

  • Vanclay F, Esteves A (2011) Current Issues and Trends in Social Impact Assessment In: Vanclay F, Esteves A (eds) New Directions in Social Impact Assessment. Edward Elgar: Cheltenham.

ABSTRACT: This introductory chapter to an edited volume covers some of the recent trends and developments that are shaping the field of social impact assessment. The authors view the book as aligned with the SIA philosophy laid out in the International Principles for Social Impact Assessment, which stress the ongoing management of social issues associated with a development activity, taking a holistic approach to impact assessment, and ensuring that the goals of development are attained. The chapter looks at how current trends around free, prior, and informed consent, notions of social responsibility, human rights impact assessment, and local content requirements are shaping SIA practice. It closes by exploring key considerations that need to be addressed in current and future SIA practice.

ABSTRACT: “The purpose of this Guidance Note is to provide advice to various stakeholders about what is expected in good practice social impact assessment (SIA) and social impact management processes, especially in relation to project development. Project development refers to dams, mines, oil and gas drilling, factories, ports, airports, pipelines, electricity transmission corridors, roads, railway lines and other infrastructure including large-scale agriculture, forestry and aquaculture projects. This Guidance Note builds on IAIA’s (2003) International Principles for Social Impact Assessment. While the International Principles outline the overarching understandings of the SIA field, including the expected values of the profession, this document seeks to provide advice on good practice in the undertaking and appraisal of SIAs and the adaptive management of projects to address the social issues. As a statement of good and sometimes leading practice, not all the information in this document will necessarily be applicable in every situation – people utilising this information will need to establish for themselves what is appropriate in each particular context.”

Environmental Impact Assessment

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Environmental impact assessment

ABSTRACT: “The widespread experience of environmental impact assessment (EIA) as an anticipatory environmental management tool has generated a considerable debate over the extent to which it is achieving its purposes. This has been measured in terms of EIA ‘effectiveness’, especially as discussion has moved away from issues of procedural implementation, to the more substantive goals of EIA and its place within broader decision-making contexts. Empirical studies have revealed the relatively weak degree of influence on planning decisions that is being exerted by EIA, which is increasingly being attributed to its rationalist beginnings. This article seeks to direct this debate towards the founding political purposes of EIA which, it is argued, provide a neglected, yet strong, basis for EIA reform. A number of illustrative suggestions are made as a result of this redirection, to enable EIA to adopt a more determinative role in decision making and to contribute to more sustainable patterns of development planning.” 

ABSTRACT: “This second implementation report on Directive 2001/42/EC on the assessment of the effects of certain plans and programmes on the environment (‘Strategic Environmental Assessment Directive’, or ‘SEAD’) presents the experience gained in applying the SEAD between 2007 and 2014…. The SEAD implements the principle of environmental integration and protection laid down in Articles 11 and 191 of the Treaty on the Functioning of the European Union. It provides for a high level of protection of the environment and helps integrate environmental considerations into the preparation and adoption of certain plans and programmes. To this end, the Directive requires an environmental assessment of plans and programmes which are likely to have significant effects on the environment. The SEAD does not lay down any measurable environmental standards. It is essentially a process directive, which establishes certain steps that Member States must follow when identifying and assessing environmental effects. The strategic environmental assessment (SEA) process is about helping policy makers take well-informed decisions, based on objective information and the results of consultation with the public/stakeholders and relevant authorities.”

Risk Management

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ABSTRACT: “Boatright takes a look at the complex phenomenon of risk management and some of the ethical issues associated with it. Although people have tried to manage risk for millennia, significant changes occurred in the mid-1990s that transformed risk management into a science that now guides much financial and business decision making. A product of sophisticated mathematical models made possible by powerful information technologies, today’s risk management tools have created exotic securities and new markets that reduce some risks and increase others. Many critics have argued that there are important technical and ethical problems associated with these practices and that they may have significantly contributed to the Great Recession of 2007.”

ABSTRACT: “The UN Guiding Principles on Business and Human Rights endorse a risk management perspective of human rights due diligence, which may create ambiguities with regard to the nature of risk and the objectives of risk management. By ‘human rights risk’ we understand a business enterprise’s potential adverse human rights impacts. Human rights risk can be contrasted to an enterprise’s ‘social risk’ which refers to the actual and potential leverage that people or groups of people with a negative perception of corporate activity have on the business enterprise’s value.

This article puts forward the argument that due diligence in respect of human rights risk is conceptually incompatible with the management of social risk, because social risk management and human rights due diligence vary at each step of the risk management process (risk identification, risk measurement and assessment, risk reduction measures). To resolve this incompatibility, an effective integration of human rights due diligence processes into corporate risk management systems would require an elevation of human rights respect to a corporate goal that determines corporate strategy.

ABSTRACT: “Assuring the existence of internal systems for effective risk management is a core component of corporate governance, embedded in best practice and the laws of many countries. Yet the global recession caused by the financial meltdown and the runaway Deep water Horizon leak in the Gulf of Mexico show, yet again, that the consequences of a business failure to anticipate and plan for catastrophic risks can devastate companies, society, communities, and the environment. In light of disasters like these, companies must take a hard look at the effectiveness of their own risk management systems. Unless they incorporate more effectively the interests of external stakeholders who may be harmed if and when the worst occurs, however, companies may still get it wrong. Building on the concept of ‘human rights due diligence’, factoring those views into company risk management requires the company to understand and address the adverse impacts of their activities on all stakeholders, internal and external to the company.”

Health Impact Assessment

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ABSTRACT: “This article examines Human Rights Impact Assessment (HRIA) as a methodological approach to investigate and measure human rights impacts and compliance. It recognizes that there is a vast body of relevant theoretical material, but notes that practical examples of its use and case studies are thus far limited. To analyse the potential contributions of HRIAs for human rights practitioners, a concrete tool is discussed: Aim for human rights ‘Health Rights of Women Assessment Instrument’, produced by Aim for human rights. The article considers lessons that can be drawn from practical experiences with this tool. In the discussion of the case studies, examples of results and outcomes of its use are provided. The authors then extrapolate from the concrete tool to discuss to what extent HRIA as a methodology can contribute to measuring and promoting the realization of human rights. They highlight benefits as well as challenges that still have to be overcome. Finally, a call is made for more intensive sharing of practical experiences with HRIA tools in order to move the methodology forward.”

ABSTRACT: “The World Health Organization has written that ‘without health, other rights have little meaning’ (Jamar 1994). Over the past decade, the full ramifications of this statement have become clearer, as the health and human rights movement has endeavoured to establish conceptual and analytical bridges between the two disciplines of health and human rights, to create a field of discourse that goes to the very essence of human wellbeing. That discourse now faces the challenge of evolving itself from the conceptual to the operational, so that the linkages between health and human rights are explicitly recognised and incorporated in decision-making processes. There is therefore a rising call for new methodologies that can advance this ongoing evolution. A right-to-health impact assessment has been suggested as one such methodology, on the basis that it might provide decision makers across sectors with an evidence-based mechanism for analysing and anticipating the effects of their decisions. This article seeks to explore that possibility by examining the experiences of health impact assessment and human rights impact assessment and considering whether a right-to-health impact assessment offers anything more than these existing methodologies. These considerations belie complex conceptual and methodological issues, and the article offers some preliminary thoughts on the issues with which the health and human rights movement will need to grapple as it continues its struggle to mainstream human wellbeing.”

ABSTRACT: In recent years, there has been a growing demand for governments to carry out human rights impact assessments prior to adopting and implementing policies, programmes and projects. To date, however, little work has been done to develop methodologies and tools to aid governments in undertaking human rights impact assessments. The purpose of this project is to contribute to the development of such a methodology. UNESCO provided the funding for this project, and the United Nations Special Rapporteur on the right of everyone to the enjoyment of the highest attainable standard of health (‘the right to the highest attainable standard of health’ or ‘the right to health’) supervised the project and preparation of this report. This report emphasizes the role of human rights impact assessment in alleviating poverty…. This report reviews and then draws key criteria from three pioneering human rights impact assessment initiatives:  (1) the  NORAD  Handbook  in Human Rights Assessment, (2) the  Rights & Democracy Initiative  on Human Rights Impact  Assessment, and (3) the HOM Health Rights of Women Assessment Instrument. We focus specifically on the obligation of governments to undertake impact assessments in order to comply with their obligation to progressively realize human rights and, accordingly, propose a methodology specifically suited to government assessments.

ABSTRACT: “Two decades ago, Lawrence Gostin and Jonathan Mann developed a methodology for human rights impact assessment (HRIA) of proposed public health policies. This article looks back over the last 20 years to examine the development of HRIA in the health field and consider the progress that has been made since Gostin and Mann published their pioneering article. Health-related HRIA has advanced substantially in three ways. First, the content of the right to health has been delineated in greater detail through domestic and international laws and policies. Second, the UN human rights mechanisms have recommended that governments undertake HRIAs and have issued guidelines and methodologies for doing so. Third, nongovernmental organizations and international organizations have developed HRIA tools and carried out case studies to demonstrate their feasibility. In this light, the article concludes by recognizing the substantial progress that has been made in HRIA over the last 20 years and by considering some challenges that remain for health-related HRIA.”

ABSTRACT: “In the developing world, large-scale projects in the extractive industry and natural resources sectors are often controversial and associated with long-term adverse health consequences to local communities. In many industrialised countries, health impact assessment (HIA) has been institutionalized for the mitigation of anticipated negative health effects while enhancing the benefits of projects, programmes and policies. However, in developing country settings, relatively few HIAs have been performed. Hence, more HIAs with a focus on low- and middle-income countries are needed to advance and refine tools and methods for impact assessment and subsequent mitigation measures. We present a promising HIA approach, developed within the frame of a large gold-mining project in the Democratic Republic of the Congo. The articulation of environmental health areas, the spatial delineation of potentially affected communities and the use of a diversity of sources to obtain quality baseline health data are utilized for risk profiling. We demonstrate how these tools and data are fed into a risk analysis matrix, which facilitates ranking of potential health impacts for subsequent prioritization of mitigation strategies. The outcomes encapsulate a multitude of environmental and health determinants in a systematic manner, and will assist decision-makers in the development of mitigation measures that minimize potential adverse health effects and enhance positive ones.”