The initiative requires the enterprise's due diligence to be preventative.
• The goal of the enterprise's due diligence is first and foremost to avoid causing or contributing to adverse impacts on people, the environment and society, and to seek to prevent adverse impacts directly linked to the enterprise's operations, products or services through business relationships.
• When involvement in adverse impacts cannot be avoided, the enterprise carries out due diligence to mitigate them, prevent their recurrence and where relevant remediate them.
Relevant criteria are, for example:
The initiative requires the enterprise's due diligence to be an integral part of decision-making.
The enterprise embeds responsible business conduct into policies and management systems to prevent adverse impacts on RBC issues and to support effective due diligence by clarifying the enterprise's strategy, building staff capacity, ensuring the availability of resources and communicating a clear tone from the top of the organisation.
Relevant criteria are, for example:
1.01 - 1.11 (RBC due diligence policy)
The initiative requires the enterprise's due diligence to be commensurate with risk (i.e. it is risk based)
The measures that the enterprise takes to conduct due diligence are:
• commensurate to the severity and the likelihood of the adverse impact
• more extensive in higher risk contexts than in lower risks contexts.
• adapted to the nature of the adverse impact.
The initiative requires the enterprise's due diligence to involve prioritisation (i.e. it is risk based)
• The enterprise prioritises the order in which it takes action based on the severity and likelihood of the adverse impact.
• Once the most significant impact is dealt with, the enterprise moves on to address less significant impacts.
• The process of prioritisation is on-going and in instances where new or emerging impacts arise, these are prioritised before moving on to less significant impacts.
• When prioritising risks to human rights, the enterprise ensures the severity of the adverse impact takes precedence over its likelihood.
The initiative requires the enterprise's due diligence to be dynamic.
• The enterprise's due diligence process is not static, but ongoing and responsive. It includes feedback loops enabling the enterprise to learn from what worked and what did not.
• The enterprise aims to progressively improve its systems and processes to better identify and prevent adverse impacts.
• Through due diligence, the enterprise is able to adequately respond to potential changes in its risk profile as its circumstances evolve.
The initiative requires the enterprise's due diligence to be informed by meaningful engagement with stakeholders.
• Meaningful engagement is two-way,conducted in good faith and responsive.
• Stakeholders are provided with truthful and complete information and given opportunity to provide input prior to major decisions being made that may affect them.
• Workers are involved—meaning that they actively participate in design and implementation—in the following due diligence processes: on-site supplier assessments; the development of corrective action plans; verification, validation and monitoring of impacts; and the design of operational-level grievance mechanisms.
The initiative requires the enterprise's due diligence to involve ongoing communication.
• The enterprise demonstrates that communicating on information on due diligence processes, findings and plans is part of the due diligence process itself and enables the enterprise to build trust in its actions and demonstrates good-faith in its decision making.
Relevant criteria are, for example:
1.17 - 1.19 (communicating the RBC policy internally and externally)
The initiative requires the enterprise's due diligence to be appropriate to its circumstances.
The nature and extent of the enterprise's due diligence is appropriate to the enterprise's size, the context of its operations, its business model, position in the supply chain and the nature of its products and services.
Relevant criteria are, for example:
1.04 (incl. risk modules) (policy committment to due diligence on most "significant risks")
The initiative requires the enterprise to considers the unique position of women systematically at all stages of the due diligence process.
The unique position of women within a particular context should be systematically considered at all stages of due diligence. Enterprises are encouraged to:
The initiative requires the enterprise to establish a policy or policies that include RBC due diligence commitments regarding their own activities and operations and its supply chain.
The enterprise RBC policy may consist of one single policy or several stand-alone policies or be integrated into wider governance documents of the enterprise – such as the code of conduct or principles of business ethics. The enterprise RBC policy may also build on existing policies and commitments.
The term "RBC due diligence commitments" should be understood to refer to "RBC risk-based due diligence commitments, aligned with OECD MNE Guidelines and the G&F Guidance. The RBC due diligence policy should be adapted and tailored to the specificities of enterprises' own supply chain and operations; it should build on increasing knowledge about risks of harm in the enterprise's supply chain and operations and on input from internal and external stakeholders (see p.41 of the OECD G&F Guidance).
The initiative requires the enterprise to establish a policy or policies that articulate their due diligence expectations of business partners - including suppliers, licensees, and intermediaries - on RBC matters across the length of their supply chain(s).
See criteria 1.01.
The initiative requires that the enterprise's policy includes commitment to observe the OECD Guidelines for Multinational Enterprises and issues covered by the Guidelines. The policy should also commit to upholding international standards on sector risks and sub-sector risks, relevant to the enterprise and make explicit reference to relevant international standards.
Examples of international standards include the OECD Guidelines for Multinational Enterprises, the UN Guiding Principles on Business and Human Rights, the Universal Declaration of Human Rights and the ILO’s Declaration on Fundamental Principles and Rights at Work. In all cases and irrespective of the country or specific context of enterprises’ operations, reference should be made to the internationally recognised human rights expressed in the
International Bill of Human Rights.
"Known sector risks" will likely include those listed as modules in the OECD Garment & Footwear Guidance. While most companies will face the risks identified in the OECD Garment & Footwear Guidance, some companies operating in sub-sectors may have additional risks not referenced by the OECD.
The initiative requires that the enterprise's policy includes commitments to conduct due diligence regarding "significant risks" in the enterprise's own operations and supply chain.
As part of its due diligence, enterprises should determine which risks of harm are most significant - in relation to likelihood and severity of harm - in its own operations and in its supply chain. See Step 2.1 of the OECD Garment & Footwear Guidance and criteria 2.07.
• The policy is based on the ILO conventions 138 and 182
• All standards are equably applicable to both boys and girls.
• The policy aligns with domestic and international laws. If national legislation is less stringent than international standards, the enterprise upholds international standards. If national law is a higher standard than international conventions, then national law is upheld.
• The policy contains descriptions of types of work considered to be hazardous.
• The enterprise adopts a zero-tolerance policy on sexual and gender based violence and has strict measures against sexual harassment.
• The policy incudes a commitment to foster an environment at work free from harassment, bullying and violence.
• The enterprise describes clear consequences for non-compliance with the policy.
• The enterprise adopts a zero-tolerance policy for forced labour.
• The enterprise may adopt a policy on the use of private recruitment agencies
• The policy establishes that the enterprise will not tolerate anti-union policies and action in its own operations.
• The enterprise has adopted policies on risk factors for non-compliance with wages (where appropriate).
Example risk-factors include: recruitment and hiring of migrant workers or subcontracting
• The enterprise considers the good practices put forth in the OECD Good Practice Guidance on Internal Controls, Ethics, and Compliance.
The initiative requires that the enterprise's policy or policies include its expectations of suppliers to conduct due diligence regarding "significant risks" in the enterprise's supply chain.
• The policy is based on the ILO conventions 138 and 182
• All standards are equably applicable to both boys and girls.
• The policy aligns with domestic and international laws. If national legislation is less stringent than international standards, the enterprise upholds international standards. If national law is a higher standard than international conventions, then national law is upheld.
• The policy contains descriptions of types of work considered to be hazardous.
• The policy articulates the expectation of suppliers and other business partners to adopt a policy relating to sexual harassment and sexual and gender-based violence.
• The enterprise describes clear consequences for non-compliance with the policy.
• The enterprise adopts a zero-tolerance policy for forced labour in its supply chain.
• The enterprise may adopt a policy on the use of private recruitment agencies by suppliers.
• The policy establishes that the enterprise will not tolerate anti-union policies and action in its supply chain.
• The policy reflects the operating context and explicitly mentions the nature of abuses of workers’ rights which are considered likely.
• The enterprise has adopted policies on risk factors for non-compliance with wages (where appropriate).
Example risk-factors include: recruitment and hiring of migrant workers or subcontracting
• The enterprise considers the good practices put forth in the OECD Good Practice Guidance on Internal Controls, Ethics, and Compliance.
The initiative requires that the enterprise's policy includes a commitment to responsible sourcing practices; i.e. a commitment that the enterprise will seek to prevent its purchasing practices contributing to harmful impacts
See Box 4 of the OECD Garment & Footwear Guidance on examples of "how to assess whether purchasing practices are contributing to harm" and "control measures to prevent contribution to harm".
The initiative requires that the enterprise's policy stipulates the enterprise’s expectations regarding the use of subcontractors including a definition and distinctions in subcontracted work if they exist.
See Box 2 of the OECD Garment & Footwear Guidance for more guidance on subcontracting.
• Child labour is most prevalent in informal sectors of the economy and formal sectors might subcontract to informal unregulated units with child labour. (103)
• Use of subcontracting reduces visibility into labour standards thus increasing the risk of child labour (104)
•The enterprise may adopt a policy on the use of private recruitment agencies and subcontracting as relevant. When not accounted for, the use of subcontracting reduces the visibility of labour standards of the supplier, thus increasing the risk of forced labour.
• To account for uncertainty, in some cases, suppliers hire a limited number of skilled workers as regular workers, and then rely on overtime hours, temporary contract workers, and subcontracting to manage the shifts in demand. (132)
• Use of subcontracting reduces visibility into labour standards thus increasing risk
• Use of subcontracting reduces visibility into labour standards thus increasing risk
• Use of subcontracting reduces visibility into labour standards thus increasing risk
• Use of subcontracting reduces visibility into environmental standards thus increasing risk
• Use of subcontracting reduces visibility into environmental standards thus increasing risk
• Use of subcontracting reduces visibility into anti-bribery and corruption standards thus increasing risk
If relevant to the enterprise’s business model, the policy states the enterprise’s expectations regarding outsourcing to homeworkers. (35)
The initiative requires that the enterprise's policy includes a commitment to meaningful stakeholder engagement in the course of due diligence.
Enterprises should engage meaningfully with affected stakeholders as part of the due diligence process. Such engagement should be two-way, conducted in good faith and responsive. Stakeholders should be provided with truthful and complete information and should be given opportunity to provide input prior to major decisions being made that may affect them. See "Meaningful Stakeholder Engagement", Introduction, p. 27 for more guidance.
The initiative requires that the enterprise's policy includes the enterprise's expectations regarding the outsourcing to homeworkers and the use of handwork, where relevant to the enterprise's business model.
The initiative encourages enterprises to include in their policy a commitment to hear and address all complaints against the enterprise regarding its own operations.
• The enterprise's policy includes a commitment to hear grievances, establish a reprisal free complaints mechanism and to maintain confidentiality of the workers who raise complaints.
The initiative encourages enterprises to include in their policy a commitment to hear and address measured and substantiated complaints that the enterprise has caused or contributed to harms in its supply chain that are raised through legitimate processes.
The initiative requires that the enterprise's policy is developed with and informed by relevant internal and external expertise.
The initiative requires that the enterprise's policy is approved at the most senior level of the enterprise.
The initiative requires that the enterprise's policy is updated through an iterative process that builds on increasing knowledge about harms in the enterprise's supply chain.
The RBC policy should not be a static document. For example, the enterprise may identify a gap in its policy after scoping the risks of harm in its own operations and in its supply chain (see Step 2.1).
The initiative encourages the enterprise to establish or strengthen corporate governance to oversee and support RBC by assigning responsibility for RBC implementation to the board and senior management.
• The enterprise considers the good practices put forth in the OECD Good Practise Guidance on Internal Controls, Ethics, and Compliance.
The initiative requires the enterprise to have senior staff with competence, knowledge and experience overseeing the implementation of the RBC policy(s).
•The enterprise considers the good practices put forth in the OECD Good Practise Guidance on Internal Controls, Ethics, and Compliance.
The initiative requires the enterprise to make the policy publicly available.
The initiative requires the enterprise to communicate the RBC due diligence policy to all relevant employees.
The initiative requires the enterprise to communicate the policy to all direct suppliers.
The initiative requires the enterprise to allocate adequate support and resources to due diligence on human rights, labour, environment and integrity risks.
For example:
• Adequate financial resources are allocated.
• Adequate staff time is secured.
• Those who work on supply chain due diligence have the competence to perform their duties.
The initiative requires the enterprise to incorporate due diligence into decision-making processes at an organisational level.
For example, due diligence could be incorporated into product design, a company's decision to source from a new country or expand sourcing or decision to source from a new suppliers, etc.
• When considering expansion in business operations, the enterprise considers ways of addressing any net increase in water demand.
The initiative requires the enterprise to establish alignment across teams and business units to support the implementation of the RBC policy.
For example, companies may facilitate functional alignment by:
• Facilitating feedback and learning on due diligence between business units (e.g. sourcing, design, RBC);
• Ensuring that information related to due diligence is provided to relevant decision makers and is adequate and appropriate;
• Including multiple business units in making a decision that may increase the risk of harm in the company's own operations or in its supply chain.
The initiative requires the enterprise to have information management systems that are accurate and current and capable of storing the full extent of information necessary to conduct due diligence.
See Table 1, p. 45, for guidance on which information should be collected and stored for the purposes of conducting due diligence.
The initiative encourages the enterprise to store due diligence information for a minimum of 5 years.
The initiative encourages the enterprise to build into supplier contracts an obligation to support supply chain due diligence of risks linked to upstream production where appropriate.
The initiative requires the enterprise to conduct an informed scoping exercise to identify which risks of harm are most significant - in relation to likelihood and severity of harm - in its own operations and in its supply chain.
The scoping takes into account risks along the entire length of the supply chain from raw materials to retail. Risks significance takes into account both the likelihood and severity of potential harms. For more information see notes for criteria 2.07.
• Employees who scope the risks of forced labour in their own operations and their supply chain understand what constitutes forced labour, common forms of forced labour, vulnerable workers, and international standards.
• The scope of due diligence on wages includes both wage compliance with national laws and alignment with OECD standards
• The enterprise scopes the chemicals used in the production of goods within its sub-sector, with an emphasis on identifying harmful and hazardous chemicals and restricted chemicals.
• The enterprise establishes an inventory of chemicals being used in production and manufacturing of their products.
• When identifying bribery and corruption risks, the enterprise considers the five groups of risk (country, sectoral, transaction, business opportunity and business partnership).
The initiative requires the enterprise's scoping to build on known sector and subsector risks.
Sector risks are risks that are prevalent in the garment and footwear sector globally across product lines and geographies. The most common sector risks are well documented and listed in Table 2. Some sub-sectors (e.g. luxury goods, sports apparel, work apparel, etc.) may face unique risks which are not included in Table 2 (such as animal welfare), but should likewise be considered if relevant.
Specific guidance regarding risks related to animal welfare, husbandry and land-rights is not included in this Guidance but may be relevant to some actors in the garment and footwear supply chain. The OECD provides due diligence guidance on these issues in the OECD-FAO Guidance for Responsible Agricultural Supply Chains.
• See Table 9 for example risk factors for child labour and their pertinence to the sector. (102)
• See Table 10 for example risk factors for sexual harassment and their pertinence to the sector. (119)
• The enterprise consults existing reports by governments, international organisations, and other credible institutions to identify materials and production processes associated with forced labour and well as high risk sourcing areas.
While some countries may hold higher risks than others, excessive overtime is prevalent across most sourcing countries.
Excessive overtime may be increased where there are high rates of migrant
workers employed in the sector, however, this indicator should not be used alone to determine high-risk contexts for excessive overtime. (134)
• The enterprise reviews existing reports on known health and safety risks for the sector and its sub sector
The initiative requires the enterprise's scoping to take into account risks that may be specific to the products that the enterprise makes or sells.
Product risks could include risks linked to materials (e.g. chemical use in leather, water use for cotton, greenhouse gas emissions for polyester), but could also include the specific processes used for products (e.g. hand embroidery).
• See Table 9 for example risk factors for child labour and their pertinence to the sector. (102)
• See Table 10 for example risk factors for sexual harassment and their pertinence to the sector. (119)
• See Table 11 for example risk factors (127)
• See Box 11 for factors that may drive excessive working hours
at manufacturing (135)
• Risks related to the worker’s right to establish or join a trade union and bargain collectively are generally not linked to specific product-lines or stages of the supply chain (146)
• Wage non-compliance is a risk at all stages of the garment and footwear supply chain that are labour-intensive and employ low-income workers.
• The enterprise identifies stages in its supply chain that are associated with higher-risk for water pollution and the need for adequate wastewater management. In the garment and footwear sector, these are likely to be cotton growing and wet-processing (textile and leather).
• The enterprise identifies product lines and production process which may include the involvement of homeworkers. For example, traditional handicraft work, such as embroidery and weaving.
The initiative requires the enterprise's scoping to take into account factors within the countries where the company operates or sources that may make sector risks more likely.
Country risk factors generally include governance, socio-economic and industry factors, which may make
the sector risks more likely. For example, high rates of migrant labour is a risk factor for child labour, forced labour, non-compliance with
wage legislation and sexual harassment.
• See Table 9 for example risk factors for child labour and their pertinence to the sector. (102)
• The enterprise takes into account that sexual harassment and sexual
and gender-based violence can be particularly difficult to identify due to a lack of reliable country-level and sector-level data. For example, document reviews may not be sufficient. (117)
• Where gaps in information exist, the enterprise (is encouraged to) consults stakeholders and/or experts on the ground. (117)
• The enterprise is aware that in many contexts cultural norms may restrict women and men from discussing or reporting their experiences related to sexual harassment and sexual and gender-based violence and takes this into account. For example, the enterprise partners with trained experts to engage with workers and/or community members in discussion on these issues. (117)
• See Table 11 for example risk factors (127)
While some countries may hold higher risks than others, excessive overtime is prevalent across most sourcing countries.
Excessive overtime may be increased where there are high rates of migrant
workers employed in the sector, however, this indicator should not be used alone to determine high-risk contexts for excessive overtime. (134)
• The enterprise reviews existing reports on known health and safety risks in the countries where the enterprise is operating or sourcing from
Example questions to assess country risk factors: Are regulations and codes related to occupational health and safety adequately enforced?; Are inspections conducted by state inspectors and/or third parties? If inspections are conducted by third parties? What are the checks and balances placed on third parties?
What are the qualification requirements of inspectors? How do these qualifications compare with international benchmarks.
• The enterprise considers national laws that may restrict the right to establish or join a trade union and representative organisations of the workers own choosing can be considered a red flag. (See pg. 147 for more information)
• In the scoping exercise, the enterprise understands the extent to which civil and political liberties are protected and exercised. (146)
The enterprise gives special attention to free trade zones where other labour laws may apply.
• The enterprise understands the legal and institutional framework for industrial relations.(146)
• The enterprise focuses its scoping exercise on country risk factors .
Example risk factors include:
Multiple rates for minimum wages; workers are paid per piece; the sector employs high rates of migrant workers; the sector employs high rates of informal workers; workers live on site; employees include high proportions of young workers or apprentices; workers are paid cash rather than electronically; workers have high illiteracy rates or low levels of education. (153)
• The enterprise is aware of categories of workers who may be excluded from minimum or negotiated wages and are vulnerable to wages that do not meet basic needs. (153)
• The enterprise determines whether wet processing is located in higher-risk countries. Elements to consider include:
Does the country (or production cluster) have adequate wastewater
infrastructure?; Does the country adequately enforce its wastewater regulations (i.e. are there credible inspections)?;
• Country-level data may not be sufficient in determining the above.
• The enterprise identifies sourcing countries where homeworking is more prevalent and where homeworkers are at a higher risk of being exploited.
The initiative requires the enterprise's scoping to take into account risks factors that may be specific to the enterprise's sourcing model.
Sourcing model refers to the characteristics of the company's supply chain. For example, a company may be exposed to more risks if it is sourcing from a large number of suppliers with whom it has short-term relationships.
Some examples are included below, although this list is not comprehensive, Step 2.1, p. 50:
• Large numbers of suppliers may increase the exposure to harm in the enterprise’s supply chain. Furthermore, a large number of suppliers in relation to the size of the enterprise and its resources dedicated to supply chain due diligence can be more difficult to control.
• See Table 9 for example risk factors for child labour and their pertinence to the sector. (102)
• See Table 10 for example risk factors for sexual harassment and their pertinence to the sector. (119)
• See Table 11 for example risk factors (127)
• See Box 11 for factors that may drive excessive working hours
at manufacturing (135)
• The enterprise identifies higher-risk stages in its own operations and in its supply chain and the use of harmful and hazardous chemical and restricted chemicals.
The initiative requires the enterprise's scoping to take into account components of the company's business model that may increase the likelihood or scope of risks in its supply chain.
Business model relates to business of the enterprise such as the number of product lines that it sells and how often those product lines are changed (i.e. seasons per year) and its position in the supply chain (for example whether it is a retailer, licensor, licensee, brand, manufacturer, agent, etc).
Some examples of how an enterprise’s business model may affect risks of harm in its own operations and in its supply chain, Step 2.1, p, 49:
• Enterprises with numerous and highly diversified product lines are
• See Table 9 for example risk factors for child labour and their pertinence to the sector. (102)
• See Table 10 for example risk factors for sexual harassment and their pertinence to the sector. (119)
• See Table 11 for example risk factors (127)
• See Box 11 for factors that may drive excessive working hours
at manufacturing (135)
• Risk assessments look consider the extent to which internal company structures or procedures add to the level of risk. Risk factors may include policy and training, transaction risks and business risks.
The initiative requires enterprises to determine which risks of harm are most significant - in relation to likelihood and severity of harm - in its own operations and in its supply chain and prioritise those for action first.
Risks significance takes into account both the likelihood and severity of potential harms. Severity is judged on scale, scope and irremediable character:
• ‘Scale’ refers to the gravity of the adverse impact;
• ‘Scope’ concerns the number of individuals that are or will be affected.
• ‘Irremediable character’ means any limits on the ability to restore those affected to a situation at least the same as, or equivalent to, their situation before the adverse impact.
The initiative requires the enterprise's scoping to be documented.
The initiative encourages the enterprise to consult with stakeholders and experts, where gaps in information exist.
Practically, there are a number of ways in which enterprises may engage with stakeholders. Together enterprises and stakeholders are encouraged to identify methods for engagement that are effective for them. Industrial relations can be considered an important form of stakeholder engagement in which management engages the workforce collectively. The enterprise should prioritise engaging with stakeholders, or their interlocutors, who are most likely to be affected by the activities of the enterprise.
• The enterprise takes into account that sexual harassment and sexual
and gender-based violence can be particularly difficult to identify due to a lack of reliable country-level and sector-level data. For example, document reviews may not be sufficient. (117)
• Where gaps in information exist, the enterprise (is encouraged to) consults stakeholders and/or experts on the ground. (117)
• The enterprise cooperates at a sector wide level with governments, workers, international organisations, stakeholders, and civil society organisations to identify higher risk activities and areas for forced labour as appropriate.
The initiative requires the enterprise to review the findings of the scoping assessment on a semi-regular basis.
The initiative requires the enterprise to continually update the information in its risk scoping based on changing circumstances and be ready to respond to emerging risks.
Information brought to the enterprise’s attention (e.g. through reports, stakeholder engagement, grievance mechanisms) and changing circumstances - such as changes in the regulatory framework of a country - is incorporated into the company’s scoping exercise.
The initiative requires the enterprise to carry out a self-assessment of its own operations to determine the extent of risks and actual impacts.
Assessments should be tailored to severity and likelihood of the risk of harm. For guidance on the assessment methodology including a non-exhaustive list of example policies, systems and measures that the enterprise may review see the G&F Guidance, p.53-54.
• The enterprise measures the GHG emissions and removals associated with a specific product.
• The enterprise works towards measure the GHG emission that are a result of their own activities.
• If an enterprise has limited resources, its starts by measuring the GHG emissions that are the results of its own operations and activities.
The initiative encourages the enterprise to follow existing credible guidance for employers when assessing for risks of harm in its own operations.
For example, the ILO has developed extensive guidance for employers on how to identify and mitigate labour risks.
The initiative requires the enterprise to engage with potentially affected stakeholders (workers, trade unions and representative organisations) to identify potential and actual harm in its own operations.
The initiative requires the enterprise to review its policies and systems to assess the extent to which risks are being prevented or mitigated.
See Step 2.2., p. 54 for a list of example policies, systems and measures that the enterprise may review as part of its self-assessment.
The initiative encourages the enterprise to seek external support to conduct a self-assessment if the impact may cause severe harm if not adequately prevented and/or the prevention measures require technical expertise not available in-house.
The initiative requires the enterprise to assess suppliers who are associated with higher risks of those harms prioritised during the scoping exercise.
Suppliers are selected for assessment based on the severity and likelihood of the risk of harm determined in the risk scoping, not their position in the supply chain. Thus it is a dynamic and not static list of suppliers.
Some considerations in determining suppliers that are higher-risk include:
• The enterprise focuses its efforts where GHG emissions are the greatest.
The initiative requires the enterprise to seek assurances from suppliers that the prioritised suppliers upstream are being assessed where severe risks are linked to upstream processes (e.g. cotton growing).
While it may not be practicable for the enterprise to carry out assessments of upstream suppliers, the enterprise verifies that mid-stream enterprises, and especially those operating at choke points, are identifying, preventing and mitigating harms linked to their suppliers, or collaborate with credible initiatives to address these upstream risks.
The enterprise is encouraged not to mandate that suppliers engage in specific initiatives unless the enterprise supports the costs of the supplier’s participation and any associated premiums.
The enterprise is encouraged to recognises a range of collaborative due diligence initiatives, tools, etc. that conform with this Guidance to carry out due diligence on upstream suppliers.
The initiative requires the enterprise to conduct supplier assessments when there are gaps in information or where the context has likely changed.
Within this context, enterprises are encouraged to observe the following guidance, Step 2.3, p. 57:
• New suppliers should be assessed prior to the placement of orders. The results of the supplier assessment should inform whether the enterprise is able to engage with the supplier responsibly. See section 3.2.2 on prequalification.
• Supplier assessments can be conducted by the enterprise or by
relying on existing credible assessments if such assessments have been conducted within a reasonable period of time (e.g. past year).
The initiative requires the enterprise to assess the measures that the assessed supplier has implemented to prevent harm.
Measures that the supplier has implemented to prevent harm could be for example policies, training, or facility upgrading.
• The enterprise assesses whether prioritised suppliers have measures in place to source responsibly from homeworkers.
The initiative requires the enterprise to assess the actual harm on the ground and risks of harm.
Actual harm on-the-ground or risks of harm could be for example the unsafe handling of chemicals.
• The enterprise assesses supplier compliance with national legislation and international standards.
• The enterprise assesses for compliance with legal or collective bargaining agreements regarding overtime conditions and limits.
• The enterprise assesses compliance with legislation or collective bargaining agreements concerning personal leave, including sick leave, and annual leave.
• Assessments include assessing the intimidation of workers and anti-union behaviour.
• The supplier assessment seeks to identify whether anti-union polices and practises are being promoted by the supplier.
• Include assessments of the promotion of employer-dominated structures, worker involvement mechanism and corrupt labour practices.
• Assessments assess systemic or organised employer opposition and hostility to trade unions.
• The supplier assessment provides assurances of compliance with national minimum wage.
• To the extent feasible, supplier assessments cover wage discrimination.
• Assessments over whether workers are informed of their wages, payments are made on time, workers are provided with clear wage statements that they can read, workers are free to choose how they spend their wages.
• Assessments cover whether deductions are reasonable and in accordance with national law and collective agreements, compulsory bonuses, and legally required leave time.
• The enterprise determines whether printing or other high-risk processes for the use of hazardous and harmful chemicals are conducted in house by the supplier or are subcontracted, where relevant.
The initiative requires the enterprise to assess the extent to which the workers are aware of their rights in relation to human rights and labour rights.
The initiative requires the enterprise to assess whether the supplier has established an operational-level grievance mechanism and whether it is effective and meets the recommendations in Table 8 of the Guidance
Enterprises are encouraged to consult the extensive guidace that exists on establishing operational-level grievance mechanisms in accordance with the OECD Guidelines and the UN Guiding Principles, including Table 8 of the G&F Guidance, p.96.
• The enterprise seeks to understand whether the supplier has established an operational- level grievance mechanism and the extent to which it meets the following requirements: the possibility of remaining anonymous; the possibility of submitting complaints through multiple access points, at least one of which is non-management; and the principle of confidentiality.
The initiative requires the nature of the enterprise's assessment to correspond to the potential risk.
The nature of the assessment means for example deciding whether to conduct an inspection, interviews, or focus groups. There is no single form of assessment that is suitable for all risks. For example, a technical inspection is necessary to inspect the structural integrity and fire and building safety of a site, whereas off-site focus groups may be appropriate when assessing the risk of sexual harassment in the workplace.
• Supplier assessments rely heavily on interviews with workers (without management present), management and other stakeholders.
• The assessment may incorporate participatory methods of assessment where a high risk of child labour is flagged.
• If risks of the worst forms of child labour are flagged, qualified experts are engaged in the onsite assessment to ensure the child's protection.
• The enterprise carries out worker interviews and/or focus group discussions as part of the assessment process. (120)
• The enterprise seeks input from trade unions and representative worker organisationsto tailor assessments so that they are appropriate within the
context. (120)
• The enterprise considers whether it is most appropriate for those conducting the assessment to be women. (120)
• Supplier assessments rely heavily on interviews with workers, management, and other stakeholders.
• The enterprise take into consideration workers fear of responding honestly and take appropriate measures. For example, the enterprise may conduct assessments off site or using non-traditional methods of assessments such focus groups discussions and participatory assessment methods.
• Worker interviews are a core component of supplier assessments; however the enterprise takes steps to mitigate the risk that workers provide pre-prompted answers, for example, by employing participatory interview methods)
• For risks that do not pose severe harm to persons, communities or the environment:Assessments may be conducted by trained professionals, but
assessments do not have to be independent. Assessments include workers and/or their representatives including women.
• For risks of severe harm: The enterprise should ensure that the supplier has undergone a qualified inspection against national and international standards.
In some contexts, a government inspection is sufficient; however, in contexts in which government inspections are inadequate or non-existent, enterprises should verify that the supplier has been assessed by a qualified professional (e.g. structural engineers, fire protection specialists, electrical engineers, safety, health and environment specialists for handling chemicals) with relevant qualifications.
• The enterprise take into consideration workers fear of responding honestly and take appropriate measures. For example, the enterprise may conduct assessments off site or using non-traditional methods of assessments such focus groups discussions and participatory assessment methods.
• Supplier assessments include engagement with workers and trade unions and representative organisations of the workers own choosing.
• Supplier assessments include on-site visits, chemical tests, and reviews of quality certificates.
The initiative requires the enterprise's assessment to be adapted to the local context.
The enterprise seeks to understand the context in which it is operating in. and tailors the assessment appropriately.
• Power dynamics and cultural norms are considered in design and implementation of assessments.
• The enterprise understands which population groups are affected by harm, local risk factors that could worsen harms, the underlying causes of harm and the actors involved in the harm.
• The enterprise identifies the availability of judicial and non-judicial grievance mechanisms, to the extent possible.
• The enterprise consults with workers and other stakeholders on whether assessments should take place on or off site.
• The enterprise engages with experts to tailor assessments so that they are appropriate in the context and to both women and to men. (120)
• The enterprise identifies the judicial and non-juridical grievance mechanism(s) that are external to the enterprise's operational level grievance mechanism and are available to workers.
• The enterprise tailors assessments to the sourcing contexts or production cluster and to the forced labour risk. For example:
• In contexts when apprentices are common, the assessments take into account the unique forced labour risks associated with the region.
• In cases where migrant workers are employed the supplier assessment covers the forms of forced labour which may face migrant workers.
• In cases where private recruitment agencies are used, the enterprise extend assessments to cover assessments of the supplier’s due diligence of the agencies.
• The enterprise seeks to understand the drivers of excessive working hours.
For example: Low wages, poor purchasing practises and ineffective in production planning are examples of drivers for excessive working hours.
The initiative requires the enterprise to involve workers in the design of assessments for labour and human rights issues.
Workers should be involved either directly or through their trade unions and representative organizations of their own choosing.
• The enterprise consults with workers and other stakeholders on whether assessments should take place on or off site.
For risks of harm which are subjective (such as human rights and labour risks), the initiative requires enterprises to use multiple data points to assess the situation.
Triangulation, which involves the convergence of data from
multiple data collection sources, helps ensure that findings are credible and defensible.
The initiative requires the enterprise's assessment methodology to be adjusted if actual findings do not correspond to expected findings.
For example, if a supplier is operating in a high-risk context for excessive working hours and excessive working hours are not found, the enterprise should reconsider the assessment methodology.
The initiative requires that the assessment team have extensive knowledge of the relevant risks, including an understanding of the best methodology to identify actual and potential harms related to the risk within the local context.
While it may not be feasible for one person to have all of the competencies included in criteria 2.29-2.31, those conducting supplier assessment may include teams that have, together, all of the relevant competencies.
• If risks of the worst forms of child labour are flagged, qualified experts are engaged in the onsite assessment to ensure the child's protection.
• The enterprises consider whethers it is most appropriate for those conducting the assessment to be women. (120)
• In cases in which there is a high-risk that children have been sexually harassed or abused, those conducting the assessment should be trained in engaging with children in a way that does no harm.(120)
• For risks that do not pose severe harm to persons, communities or the environment:Assessments may be conducted by trained professionals, but
assessments do not have to be independent. Assessments include workers and/or their representatives including women.
• For risks of severe harm: The enterprise should ensure that the supplier has undergone a qualified inspection against national and international standards.
In some contexts, a government inspection is sufficient; however, in contexts in which government inspections are inadequate or non-existent, enterprises should verify that the supplier has been assessed by a qualified professional (e.g. structural engineers, fire protection specialists, electrical engineers, safety, health and environment specialists for handling chemicals) with relevant qualifications.
The initiative requires the enterprise's assessment team to have knowledge of national and international standards related to the adverse impact.
The initiative requires the enterprise's assessment team to have the capability to conduct the assessment within the local context.
In addition to the above competencies, given the predominance of women in the sector and sensitivity surrounding some of the issues (e.g. sexual harassment, forced labour, etc.) the enterprise should be
conscientious as to whether the gender of the person conducting the assessment is important.
• Those conducting the assessment have a strong understanding of national labour laws.
The initiative requires, for labour and human rights issues, that assessments rely heavily on worker interviews.
Workers should be involved either directly or through their trade unions and representative organizations of their own choosing.
• The enterprise take into consideration workers fear of responding honestly and take appropriate measures. For example, the enterprise may conduct assessments off site or using non-traditional methods of assessments such focus groups discussions and participatory assessment methods.
• The enterprise considers that some workers may fear responding honestly to questions and designs assessments to take this into account. For example, conducting interviews away from the workplace and using non traditional methods of assessment such as focus group discussions.
• Those conducting the assessment have a strong understanding of national labour laws.
The initiative requires the enterprise to make good faith efforts to understand whether it has caused, contributed to or is linked to the impacts that it has identified.
See Step 2.4, p. 66 and Box p. 67 for more information on 'cause', 'contribute' and 'directly linked'.
For brands and retailers, ensuring that members are monitoring their purchasing practices may be most relevant for "contribution" to harm.
The initiative requires the enterprise to take immediate actions to stop existing impacts.
Enterprises should cease actions that are causing or contributing to harm in the enterprise’s own operations.
The initiative requires the enterprise to establish and implement a plan to prevent and/or mitigate future harm in its own operations.
The components of a corrective action plan (CAP) are likely to include actions that relate to the following components: policy, training, facility upgrading, management systems and rights of workers. If components are not included, justification should be provided. Most important is that the measures taken to address risks are commensurate with the harm and that they are appropriate to the circumstances.
The initiative requires the enterprise to take immediate actions to prevent any potential immediate and critical danger in the short-term.
• Where there are immediate and critical danger to the health and lives of employees, the enterprise ensures workers are immediately removed from danger.
• Where there is immediate and critical danger to the environment, the enterprise stops its activities causing harm until the danger is addressed.
• If a child is engaged in hazardous work, the child is immediately removed from hazardous tasks.
• If immediate and critical danger has been identified, the enterprise has ensured that production does not take place at the affected production site until the danger has been addressed. In cases which impacts or risks of impact cannot be isolated, this may mean that the site is evacuated and that the production is suspended until the building is determined to be safe for re-occupancy.
• Shorter term programmes are
supported by training of staff (including technical staff) and worker safety committees (with democratically elected worker representatives at the site where feasible) .
The initiative requires the enterprise to seek to develop outcome oriented solutions that lead to prevention of harm in the longer-term.
Components of a corrective action plan (CAP) to promote longer-term solutions are likely to include some or all of the following components: policy, training, facility upgrading, management systems and rights of workers. If components are not included, justification should be provided.
Ongoing prevention and mitigation of dangers is aligned with international standards and guidance.
Additionally,
• The enterprise implements existing guidance on how to stop and prevent child labour in their own operations.
Example components of a CAP include: increasing worker and management awareness; establishing management systems to mitigate the risk of non compliance; eliminate hazardous child labour by identifying, preventing, and mitigating workplace health and safety risks; and addressing the root causes of child labour.
•Training and information provided to workers may cover:
− Enterprise policy against child labour
• Training is a core component of a CAP.
• Training raises awareness amongst workers on what constitutes harassment and violence.
• Training informs workers on the processes that are available to them to raise complaints within the workplace and outside of it.
• Training targets both men and women, supervisors, management and other in a position of authority.
• The enterprise applies the recommendations and practises put forth in guidance published by credible organisations such as the ILO on how to prevent forced labour once a risk has been identified.
• The enterprise is encouraged to build awareness amongst workers on their rights in relation to contracts, working hours, freedom of movement, etc.
• The enterprise is encouraged to develop tailored training for management and staff involved in the hiring of workers on national and international standards regarding forced labour and importantly, the company’s policies and processes to prevent forced labour.
• The enterprise is encouraged to establish a prequalification process for private recruitment agencies for employment (where relevant).
• The enterprise collaborates across the sector to identify practical solutions.
• The enterprise tracks the number of working hours per worker.
• If low wages are driving demand for excessive hours, the enterprise conducts internal due diligence on wages.
• Workers are trained on their rights in relation to working hours, overtimes, maternity leave and related compensation.
• Measures taken are aligned with international standards and guidance.
• The enterprise establishes worker management committee with democratically elected worker representatives at the site.
• Workers receive the necessary education and training on how to work safely and evacuate in case of dangerous situations.
• The enterprise establishes an occupational and environmental health and safety programme with documented procedures to protect workers which are monitored by workers and trade unions and representative organisations of the workers’ own choosing and management. Such programmes should be aligned with international standards and guidance.
• The enterprise increases worker awareness through training resources, workshops and ongoing support.
• The enterprise management systems to mitigate the risk of non-compliance
• The enterprise mitigates the risk of insufficient resources to provide minimum wages by improving systems to plan production and establishing effective financial management and planning systems.
• The enterprise recognises the links between wages, collective bargaining and working time and conducts due diligence on these risks.
• The enterprise implements a robust chemical management plan at the site-level, which includes safe chemical storage, labelling of chemicals, issuing of PPE and availability of safety data sheets to anyone who handles chemicals.
• The enterprise provides adequate training to management and workers on chemical use and storage
• As part of its CAP, the enterprise supports the development of and adopts an industry- wide Manufacturing Restricted Substances List (MRSL) based on a scientifically- based assessments of hazards.
• The enterprise identifies and uses substitutes for chemicals on the Manufacturing Restricted Substances List based on an accepted methodology for assessing hazards.
• The enterprise implements Best Available Technique.
• Where there is a risk of harm to the environment, the enterprise avoids citing 'lack of scientific evidence' as a reason for postponing measures to prevent or minimise damage.
• The enterprise share data on GHG emissions linked with common materials and processes with other industry actors.
• The enterprise collaborates in measuring, reducing, monitoring, and reporting on GHG emissions.
• CAPS incorporate good practise set by the OECD Good Practice Guidance on Internal Controls, Ethics, and Compliance.
• Ethics and compliance programmes are applicable to directors, officers, employees, and all entities over which the company has effective control including subsidies.
• Ethics and compliance programmes cover the areas of gift, hospitality and entertainment expenses, customer travel, political contributions, charitable donations, facilitation payments, solicitation and extortion and the acceptance of goods.
• The enterprise can establish a prequalification system for intermediaries/agents that are involved in the contracting of work to homeworkers.
• The enterprise can internal protocols for the outsourcing of work to homeworkers.
• The enterprise can move towards directly contracting work to homeworkers.
• The enterprise can provide training to intermediary agents on their legal obligations and the RBC policy.
The initiative requires the enterprise’s plan on preventing and mitigating harm in its own operations to include clear timelines for follow up.
The initiative requires the enterprise's measures pursued on preventing and mitigating harm in its own operations to be proportionate to the severity of harm.
The initiative requires the enterprise to have considered whether to seek expert advice based on the level of risk.
The more complex the risk, the stronger is the case for the enterprise to draw on expert advice in designing a response.
• For risks of severe harm, corrective action plans are developed in collaboration with qualified professionals.
The initiative requires the enterprise to engage workers, trade unions and representatives of the workers own choosing during the developments of the enterprise's measures on preventing and mitigating labour-related issues in the enterprise’s own operations.
Workers should be provided with complete and accurate information and given the opportunity to raise concerns and provide input. Enterprises may also partner directly with trade unions to facilitate worker input.
The initiative requires the enterprise to develop and implement its own plan to seek to prevent or mitigate future harm in its supply chain.
This plan should detail what actions the enterprise itself will take. The following indicators include examples of ways in which a company may seek to prevent or mitigate harm. However companies have flexibility in how they address risks. Most important is that the measures taken to address risks are commensurate with the harm and that they are appropriate to the circumstances. For example, if a company is facing fire safety issues, carrying out training under criteria 3.22 will likely not be sufficient. In this case, additional measures of upgrading the factory would be necessary.
The initiative requires the enterprise’s plan on preventing and mitigating harm in the supply chain to include clear timelines for follow up.
The initiative requires the enterprise's measures pursued on preventing and mitigating harm in its supply chain to be proportionate to the severity of harm.
The initiative requires the enterprise to develop and implement a plan to prevent its contribution to harm if a risk of contributing to harm in the supply chain is identified.
See Enterprise Relationship to Impact for guidance in determining whether the enterprise has contributed to impacts in its supply chain (p. 72, p. 66-67). In most cases, the plan should include the following elements (p.73):
• Supplier engagement: seek supplier input on how the enterprise contributed to harm + potential solutions
• Control measures: Implement measures that mitigate the risk of harm. An effective policy, training of workers and management are example control measures that enterprises might take.
• Red-flag systems: Identify red-flags, or indicators for risks and include procedures for the enterprise to follow if risks of contributing to harm are identified.
For brands and retailers - The initiative requires the enterprise to implement control measures to prevent contributing to harm through its purchasing practices even if it has not identified specific instances of this.
Example control measures include:
• The enterprise sets final order placement dates with the supplier.
• The enterprise communicates the deadlines to everyone in the purchasing teams.
• The enterprise shares the purchasing plan with suppliers and communicate updates in a timely manner.
• The enterprise assesses and prevents its contribution to harm through price negotiations and purchasing practices.
• The enterprise asses and prevent its contribution to harm through its price negotiations and purchasing practises.
For brands and retailers - The initiative requires the enterprise to have a system of procedures to follow in instances where purchasing practices could contribute to harm.
For example, in instances in which orders are changed after order placement or orders are placed late, the enterprise may mitigate risks by a) paying for rushed order delivery b) changing the delivery date or c) providing a list of pre-qualified subcontractors to fill a portion of the order. See "red flag systems" in the G&F Guidance, Box 4, p. 74.
• The enterprise assesses and prevents its contribution to harm through price negotiations and purchasing practices.
• The enterprise asses and prevent its contribution to harm through its price negotiations and purchasing practises.
The initiative requires the enterprise to have developed pricing models that account for the cost of wages, benefits and investments in decent work.
Pricing models that account for the cost of wages, benefits and investments in decent work are reflected in freight on board (FOB) prices together with traditional pricing considerations such as quantities being purchased, cost of materials, skill requirements, etc.
• The enterprise assesses and prevents its contribution to harm through price negotiations and purchasing practices.
• The enterprise asses and prevent its contribution to harm through its price negotiations and purchasing practises.
The initiative requires the enterprise to implement internal measures to manage risks in its supply chain, where appropriate. These include measures that the enterprise itself can control.
For example, consider prequalification, supplier consolidation, establishing business incentives and supplier contracts. See examples of internal measures in the Guidance, p. 75-76 and Box 5, p. 76-77.
The initiative requires the enterprise to seek to prevent/mitigate risks through its product development
See product risk factors, p. 49 and introduction to environmental modules, p. 159.
The initiative requires the enterprise to have a good, local knowledge of its suppliers.
Enterprises that have longer-term relationships with their suppliers and understand the local operating context are more likely to understand the risks in their supply chain and be able to support their suppliers in pursuing outcome oriented solutions. Having local sourcing offices and visiting suppliers in-person may contribute to the above.
The initiative encourages the enterprise to establish incentives for suppliers to comply with the enterprise's RBC policy.
• The enterprise may establish long term relationships with its suppliers.
• The enterprise may integrate expectations of suppliers in line with the enterprise RBC policy into supplier contracts.
• The enterprise may increases orders or gives prospective orders for suppliers that perform well in relation to quality of production and responsible business conduct.
The initiative requires the enterprise to use its leverage, when appropriate, to influence its suppliers to prevent or mitigate impacts.
• Leverage is considered to exist where the enterprise has
the ability to effect change in the wrongful practices of the entity that has caused the harm.
• The enterprise may use its leverage to encourage its
supplier to implement the supplier's corrective action plan.
Examples of leverage include entering into direct agreements with trade unions, such as through global framework agreements or freedom of association protocol agreements to implement standards on trade union rights in the supply chain
• The enterprise communicates with their supplier why water efficiency is important to the community and to their business
The initiative encourages the enterprise to pool leverage with other buyers if an enterprise does not hold leverage.
Enterprises are encouraged to pool their leverage.
• A group of enterprises sourcing from the same supplier may use its combined leverage to encourage the supplier to prevent impacts.
• Enterprises may pool their leverage by setting joint timelines for corrective action in partnership with shared suppliers.
• Enterprises may also choose to jointly publish supplier assessments, corrective action plans, and progress against those plans, which can likewise increase leverage.
The initiative requires the enterprise to support suppliers, when appropriate, in preventing or mitigating impacts.
Support may take a number of forms and examples include:
• Partner with suppliers to develop corrective action plans that are outcome-oriented;
• Provide technical guidance—for example, in the form of training, management systems upgrading, etc.
• Facilitate participation in broader sector-wide initiatives or regional-initiatives to prevent impacts;
• The enterprise may support its suppliers on the improvement of production processes where appropriate.
• Where factory upgrades are necessary the enterprise may facilitate access to financing .
• The enterprise may provide technical guidance to suppliers, where appropriate.
• The enterprise designates a point of contact for chemical management and communicates this to the supplier.
• The enterprise supports the development of and adopts a MRSL based on credible scientifically based assessments of hazards.
• The enterprise communicates the MRSL to all suppliers operating at higher risk stages of the supply chain, regardless of geographical location.
• The enterprise identifies substitutes for chemicals on the MRSL based on scientific data.
• If the enterprise determines that it can source form water-stressed areas responsibly, it supports suppliers in the developments and implementation of water efficiency plans and/or reduces process dependence on fresh water.
• The enterprise may also rely on existing guidance on how to promote water effectively and/or reduce dependence on fresh water amongst its suppliers.
The initiative requires the enterprise to engage with government, when appropriate, to seek to prevent or mitigate adverse impacts.
It is the duty of government to protect against abuses by third parties, including business enterprises, through regulation, policymaking, investigation and enforcement. In contexts in which the government is not fulfilling its duty to protect and risks cannot be effectively or sustainably managed through supplier engagement alone, enterprises may use their leverage with government (local or national) to encourage the government to
affect change.
The enterprise considers the following when deciding whether or not to engage government:
• Is the adverse impact systemic to the country or region?
• In contexts in which forced labour is state-sponsored, the enterprise considers engaging with government either directly or through collaborative initiatives to communicate on the enterprise's commitment to prevent forced labour.
• The enterprise considers whether bilateral engagement with suppliers or engagement with government is more appropriate to address wage discrepancies. For example:
- The enterprise considers the will of the government when considering collaboration.
- The enterprise considers the current effectiveness of existing wage setting mechanisms when considering collaboration.
- The leverage of the industry with the government is factor when engaging in collaboration.
The initiative requires the enterprise to disengage from a supplier, when appropriate, to prevent adverse impacts in its supply chains.
The decision to disengage is based on the following:
• After failed attempts at preventing or mitigating impacts through the above measures, for example, when suppliers have not taken corrective action within agreed upon timeframes.
• Where the enterprise deems preventing or mitigating impacts not feasible.
• When the enterprise has identified severe harm.
• The enterprise suspends orders if forced labour has been identified until action has been taken to prevent forced labour.
• In cases of factory upgrades, if neither the enterprise or supplier can secure financing, the enterprise weighs the risk of continuing to engage and disengages from the supplier if necessary.
• If the supplier does not improve on its anti-union practices within a reasonable amount of time , the enterprise suspends orders until the supplier has demonstrated improvement.
• If the supplier continues to not comply with limits of bans for hazardous chemicals, the enterprise suspends or disengages from the supplier.
The initiative requires the enterprise to comply with national laws, international labour standards, and terms of collective bargaining agreements if the enterprise determines the need to disengage from a supplier.
The initiative requires the enterprise to provide information supporting the business decision to the supplier's management and the supplier's trade union (if one exists) if disengaging from a supplier.
The initiative requires the enterprise to give the supplier sufficient notice of the end of the relationship if disengaging from the supplier.
The initiative requires the enterprise to demonstrate its own efforts to mitigate the identified adverse impact(s) for as long as an enterprise has an ongoing relationship with a supplier.
This is an aspect of responsible disengagement. See Section 3.2.5 of the G&F Guidance.
The initiative requires the enterprise to verify internally that the enterprise has carried out the actions which it has committed to in its own operations.
The more severe the risk, the greater the level of assurance the enterprise will need that impacts have been or are being prevented. The company should verify internally that the enterprise has carried out the actions to which it has committed (for example, under the corrective action plan, within the agreed-upon time period). See the definition of "verification" on page 84 of G&F Guidance.
The initiative requires the enterprise to monitor due diligence on an ongoing basis using appropriate direct or indirect performance indicators in its own operations.
• The enterprise should monitor qualitative and/or quantitative indicators to track progress against goals. Indicators may be direct or indirect (see p.84 G&F Guidance).
• The enterprise should monitor outcomes (e.g. knowledge level of workers, worker attitude, conditions of the workplace) rather than just outputs (e.g. implementation of systems) to get a complete picture of whether harms are being prevented.
• For human rights and labour impacts, workers play an integral role in monitoring the enterprise's progress against its goals.
• Monitoring indicators should incorporate red flags that may indicate a higher risk of adverse impacts (e.g. changes in orders during peak season).
Workplace-based child monitoring committees may be an effective method of monitoring child labour. They can train workers on child labour risks, acting as a first point of access for an on site grievance mechanism and monitoring to ensure that children are not engaged in hazardous work.
• The enterprise collates records about type, pattern, and incidence of all forms of workplace harassment and violence in its own operations. Data is collected on all incidents, including both minor and potential incidents and data is disaggregated by age and sex.
• The enterprise monitors any former child labourers are adequately protected, has not returned to work or has been placed in a precarious situation.
• The enterprise may seek to assess and monitor through simple worker surveys, peer discussions, or other forms of worker engagement the following:
- The extent to which workers know what constitutes sexual harassment and gender based violence and the consequences for breaking the enterprises policy against such conduct.
• The enterprise partners with trade unions suppliers and civil society to design effective monitoring mechanism for forced labour.
• For risks of severe harm: Workers participate in the ongoing monitoring of risks of harm (where feasible).
• When risks do not pose severe harm to people, communities and the environment, the approach to monitoring is systematic and corresponds to the level of risk.
• The monitoring plan is developed at each site and is implemented by management and workers.
The initiative requires the enterprise to draw on all known information including data from on-going monitoring, internal periodic assessments, issues raised through grievance mechanisms, etc. to validate that the steps taken by the enterprise are preventing and mitigating impacts in its own operations.
See the definition of "validation" on p.84 G&F Guidance.
• For example, the enterprise may review trends in sexual harassment cases reported.
• For example, the enterprise may review the finding of worker surveys and worker discussions (see line 2)
• The enterprise does not rely on a single on-site assessment. A single on-site assessment is unlikely to provide adequate information for the enterprise to determine whether forced labour is being prevent
• Effective on-going monitoring is a crucial component of due diligence in high-risk areas for forced labour, for example, through early warning systems.
• The enterprise engages with its suppliers, workers, trade unions and representatives of the workers own choosing to assess whether corrective measures are effective.
• The enterprise may review the aggregate results of worker surveys with its suppliers, or it may conduct focus-group discussions at periodic intervals amongst workers across different suppliers within a sourcing hub to determine whether prevention measures (e.g. training) are preventing harassment or whether further efforts are needed.
The initiative requires the enterprise in instances in which harmful impacts in its own operations have not been effectively prevented or mitigated to seek to understand why this is the case and respond appropriately, including by updating and implementing corrective action plans where appropriate. If the enterprise is unable to determine why an impact has not been prevented or mitigated, it seeks external guidance.
There are a number of reasons why a harm may not have been effectively prevented or mitigated, including that the measures taken to prevent the harm were not in of themselves effective, insufficient time was provided to see progress, or inadequate resources were allocated to implement the corrective action plan. The enterprise may choose to communicate publicly on its progress against corrective action plans.
The initiative requires the enterprise to engage with external experts to validate the effectiveness of due diligence and risk management measures undertaken in its own operations where impacts may cause severe harm if not adequately prevented, or where prevention measures require technical expertise.
The initiative requires the enterprise to verify whether its due diligence requirements are being met in its supply chain.
• The level of assurance that the enterprise seeks from its suppliers corresponds with the severity of the impact.
• The timing of verification corresponds to the severity and nature of harm.
• If the enterprise relies on mid-stream suppliers operating at control points to conduct due diligence on severe harm upstream, then the enterprise has conducted an audit on the mid-stream supplier’s due diligence practices against the OECD Guidance.
• Where corrective action plans (CAPs) are in place, the enterprise assesses the progress of its suppliers against their CAPs.
• For risks of severe harm: Qualified independent professionals evaluate the implementation of the corrective action within the agreed timeframe.
• For risks of severe harm: When allegations are raised through a grievance mechanism, the supplier and the enterprise ensure that the grievance is inspected in a timely manner by a qualified professional.
The initiative requires the enterprise, whenever possible, to monitor indicators – either direct or indirect – over time to validate that impacts in its supply chain have been or are being prevented.
See the definitions of "monitoring" and "validate" on p.84 G&F Guidance.
• Where international or domestic standards exist on how to prevent or mitigate harm, verification that such standards are being followed is sufficient to assume that harm has also been prevented.
• Suppliers' workers or their representatives should feed into the enterprise's ongoing monitoring activities. This is particularly important for labour and human rights impacts but is also relevant for environmental and integrity risks.
The initiative requires the enterprise to draw on all known information including data from on-going monitoring, internal periodic assessments, issues raised through grievance mechanisms, etc. to validate that the steps taken by the enterprise are preventing and mitigating impacts in its supply chain.
See the definition of "validate" on p.84 G&F Guidance.
• The enterprise partners with its suppliers, workers, trade unions and representatives of the workers own choosing to assess whether corrective measures are effective.
• For example, the enterprise may review the aggregate results of worker surveys with its suppliers, or it may conduct focus-group discussions at periodic intervals amongst workers across different suppliers within a sourcing hub to determine whether prevention measures (e.g. training) are preventing harassment or whether further efforts are needed.
The initiative requires the enterprise in instances in which harmful impacts in its supply chain have not been effectively prevented or mitigated to seek to understand why this is the case and respond appropriately, including by updating and implementing corrective action plans where appropriate. If the enterprise is unable to determine why an impact has not been prevented or mitigated, it seeks external guidance.
The enterprise is encouraged to verify that the actions were taken in the first place.
The initiative encourages the enterprise to engage external experts to assess the effectiveness of due diligence and risk management measures undertaken in the supply chain where impacts in the supply chain may cause severe harm if not adequately prevented, or where prevention measures require technical expertise.
The enterprise is encouraged to engage external experts to verify that corrective action measures were pursued or to validate that harms have been prevented (G&F Guidance, p.87). For example, this may be achieved through reliance on a credible third party initiative. The enterprise should be able to justify any decisions taken to rely on third party initiatives. See definitions of verification and validation on p. 84 of the G&F Guidance.
• For risks of severe harm: Qualified independent professionals verify corrective actions have been taken within the agreed timeframe.
The initiative requires the enterprise to communicate publicly on its supply chain due diligence.
Criteria 1.17 addresses publication of the RBC policy. Enterprises should communicate with due regard for commercial and other competitive concerns (See Box 1). The extent and nature of an enterprise's communication will be proportionate to the risks of harm within its own operations and in its supply chain.
The initiative requires the enterprise to communicate publicly on its due diligence management systems.
This includes how due diligence is incorporated into decision-making processes and information management systems to support due diligence.
The initiative requires the enterprise to communicate publicly on its most significant risks in its own operations and within its supply chain.
The initiative requires the enterprise to communicate publicly on its processes for assessing risks.
Enterprises should explain their processes for assessing those risks. Where the enterprise has prioritised some risks of harm for immediate attention, it should justify its prioritisation process.
The initiative requires the enterprise to communicate publicly on its plan to prevent and mitigate harm in its own operations, and progress on those measures.
This criterion relates to a company’s most significant risks.
The effectiveness of due diligence is measured by the extent to which actual and potential harm is prevented and mitigated in the enterprise’s own operations and in its supply chain.
The initiative requires the enterprise to communicate publicly on its plan to prevent and mitigate harm in its supply chain, and progress on those measures.
The effectiveness of due diligence is measured by the extent to which actual
and potential harm is prevented and mitigated in the enterprise’s own
operations and in its supply chain.
The initiative requires the enterprise, if relevant, to communicate publicly on its objectives for government policy engagement and on the outcomes of engagement efforts.
The initiative requires the enterprise to communicate publicly on how it has meaningfully engaged with its stakeholders.
The initiative requires the enterprise to communicate publicly on the processes that provide access to remediation in its own operations.
The initiative requires the enterprise to communicate publicly on processes that provide access to remediation in its supply chain.
The initiative requires the enterprise to communicate publicly on the collaborative processes with which it engages that facilitate due diligence.
If the enterprise is engaging with a sector or multi-stakeholder initiative for the purposes of collaborating on due diligence and which specific components the enterprise is collaborating on (e.g.
collaboration on identification of risks, supplier assessments, etc.).
The initiative requires the enterprise to communicate publicly, at a minimum, on an annual basis.
The initiative requires the enterprise to communicate information in a way that is relevant, accurate, clear, user friendly with plain language, and to present information in a way that the intended users are able to access information.
The initiative requires the enterprise to be prepared to communicate externally, including with affected stakeholders, how it addresses its human rights impacts.
Step 5.2 in contrast to Step 5.1 is primarily about engagement and communication with affected stakeholders.
If the enterprise's operations or operating contexts pose risk of severe human rights impacts, the initiative requires the enterprise to report formally on how those risks are addressed.
All enterprises regardless of size, sourcing context, or position in the supply chain, should communicate on their due diligence practices. However, the extent and nature of an enterprise’s communication will be proportionate to the risks of harm within its own operations and in its supply chain. For example, the communication of an enterprise that sources from higher-risk countries for a severe human rights harm will be more extensive than the communication of an enterprise that does not.
The initiative requires the enterprise's communications to be of a form and frequency that reflect and enterprise's human rights impacts.
The initiative requires the enterprise's communications to provide information that is sufficient to evaluate the adequacy of an enterprise's response to the human rights impact.
The initiative requires the enterprise to ensure that communications do not pose risks to affected stakeholders, personnel or to legitimate requirements of commercial confidentiality.
The initiative requires the enterprise's communications to be accessible to impacted stakeholders.
The initiative requires the enterprise, in relation to labour rights in its own operations, to communicate with its workers and trade unions and representative organisations of the workers' own choosing, including to understand what they deem to be material information.
The initiative requires the enterprise to provide for or cooperate through legitimate processes in the remediation of adverse impacts it has caused or contributed to.
The concept of remedy aims to restore individuals or groups that have been harmed to the situation they would have been in had the impact not occurred. Where this is not possible, it can involve compensation or other forms of remedy. The OECD G&F Guidance notes that the remedy or combination of remedies that is appropriate will depend on the nature and extent of the adverse impact and may include apologies, restitution or rehabilitation (e.g. reinstatement of dismissed workers, recognition of the trade union for the purpose of collective bargaining), financial or non-financial compensation (for example, establishing compensation funds for victims, or for future outreach and educational programmes), punitive sanctions (for example, the dismissals of staff responsible for wrongdoing), and taking measures to prevent future adverse impacts.
Under the UNGPs, grievance mechanisms should provide a source of continuous learning.
See the OECD Guidelines for Multinational Enterprises (the OECD Guidelines, IV, A6.)
The initiative requires the enterprise to engage in legitimate processes that enable it to hear and address material and substantiated complaints that it has caused or contributed to harm in its supply chain.
To facilitate the provision of and cooperation in the remediation of adverse impacts that an enterprise has caused or contributed to (criteria 6.01), the OECD G&F Guidance expects enterprises to commit to hearing and addressing complaints that are raised through legitimate processes in relation to their supply chains.
Legitimate processes’ include processes that:
• allow for the affected stakeholders or stakeholder representatives to raise a complaint against an enterprise;
The initiative encourages the enterprise to consult relevant guidance on establishing supply chain grievance mechanisms or other legitimate processes for handling complaints.
Supply chain grievance mechanisms include, for example, back-up mechanisms by brands for supplier facilities or the initiative's own grievance mechanism, if relevant, for supply chains of their members.
The initiative requires the enterprise to have a process in place to enable remediation in relation to human rights impacts it has caused or contributed to.
Criteria 6.02-6.12 refer to own operations.
The initiative requires the enterprise to establish processes to enable remediation for adverse impacts other than human rights impacts (e.g. labour or environmental impacts).
The initiative encourages the enterprise to consult relevant guidance on establishing operational-level grievance mechanisms or other legitimate processes for handling complaints.
An operational-level grievance mechanism is a formalised means
through which individuals or groups can raise concerns about the impact an enterprise has on them – including, but not exclusively, on their human rights – and can seek remedy. Operational-level grievance mechanisms operate at the firm or site-level and are therefore often the first entry point for a worker or community member to raise a concern. In addition to providing processes for workers and community members to seek remedy if they have been harmed, operational-level grievance mechanisms act as an early-warning system to raise concerns and thereby may prevent the
escalation of issues. Operational-level grievance mechanisms may take many forms, including in-house worker complaint mechanisms, industrial relations and third-party complaint systems, amongst others.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of legitimacy.
Legitimate means: enables trust from the stakeholder groups for whose use they are intended and being accountable for the fair conduct of grievance processes.
See example components in Table 8 on p. 96 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of accessibility.
Accessible means: Known to all stakeholder groups for whose use they are intended and providing adequate assistance for those who may face particular barriers to access.
See example components in Table 8 on p. 96 of the G&F Guidance.
• Grievance mechanisms are accessible to those that can raise concerns on a child's behalf.
• Outreach on use of grievance mechanism includes training to local civil society.
• The operational level grievance mechanism enables a worker to report harassment, violence or threats of violence without fear of reprisal or criticism, to points of contact beyond company and union representatives and anonymously confidentially.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of predictability.
Predictable means: Provides a clear and known procedure with an indicative time frame for each stage and clarity on the types of process and outcome available and means of monitoring implementation.
See example components in Table 8 on p. 97 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of equitability.
Equitable means: Seeking to ensure that aggrieved parties have reasonable access to sources of information, advice and expertise necessary to engage in a grievance process on fair, informed and respectful terms.
See example components in Table 8 on p. 97 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of transparency.
Transparent means: Keeping parties to a grievance informed about its progress and providing sufficient information about the mechanism's performance to build confidence in its effectiveness.
See example components in Table 8 on p. 97 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of being dialogue-based.
Dialogue-based means: Seeking to resolve grievances through dialogue between the enterprise and the affected party or their representatives. See Table 8 on p. 97 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it does not preclude access to judicial recourse (e.g. through legal waivers) for victims of gross human rights violations and the enterprise does not interfere with civil or criminal investigations or human rights examinations.
• The enterprise identifies or puts in place mechanisms to report crimes of the worst forms of child labour to relevant authorities.
• The enterprise identifies or puts in place a mechanism to report crimes of forced labour to relevant authorities.
The initiative encourages the enterprise to publish complaints and incorporate lessons learned into policies and monitoring systems.
The initiative's grievance mechanism is based on the core criteria of legitimacy.
Legitimate means: enables trust from the stakeholder groups for whose use they are intended and being accountable for the fair conduct of grievance processes.
See example components in Table 8 on p. 96 of the G&F Guidance.
The organisation of a multi-stakeholder grievance mechanism can limit how it is able to meet the core criteria of legitimacy, accessibility, predictability, equitability, transparency and being dialogue-based. Enterprises and multi-stakeholder grievance mechanisms should be aware of these potential limitations and account for them to the extent possible. See further guidance in Box 9, p. 100.
The initiative's grievance mechanism is based on the core criteria of accessibility.
Accessible means: Known to all stakeholder groups for whose use they are intended and providing adequate assistance for those who may face particular barriers to access.
See example components in Table 8 on p. 96 of the G&F Guidance.
The initiative's grievance mechanism is based on the core criteria of predictability.
Predictable means: Provides a clear and known procedure with an indicative time frame for each stage and clarity on the types of process and outcome available and means of monitoring implementation.
See example components in Table 8 on p. 97 of the G&F Guidance.
The initiative's grievance mechanism is based on the core criteria of equitability.
Equitable means: Seeking to ensure that aggrieved parties have reasonable access to sources of information, advice and expertise necessary to engage in a grievance process on fair, informed and respectful terms.
See example components in Table 8 on p. 97 of the G&F Guidance.
The initiative's grievance mechanism is based on the core criteria of transparency.
Transparent means: Keeping parties to a grievance informed about its progress and providing sufficient information about the mechanism's performance to build confidence in its effectiveness.
See example components in Table 8 on p. 97 of the G&F Guidance.
The initiative's grievance mechanism is based on the core criteria of being dialogue-based.
Dialogue-based means: Seeking to resolve grievances through dialogue between the enterprise and the affected party or their representatives. See Table 8 on p. 97 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it does not preclude access to judicial recourse (e.g. through legal waivers) for victims of gross human rights violations and the enterprise does not interfere with civil or criminal investigations or human rights examinations.
The initiative encourages the enterprise to publish complaints and incorporate lessons learned into policies and monitoring systems.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of legitimacy.
Legitimate means: enables trust from the stakeholder groups for whose use they are intended and being accountable for the fair conduct of grievance processes.
See example components in Table 8 on p. 96 of the G&F Guidance.
The organisation of a multi-stakeholder grievance mechanism can limit how it is able to meet the core criteria of legitimacy, accessibility, predictability, equitability, transparency and being dialogue-based. Enterprises and multi-stakeholder grievance mechanisms should be aware of these potential limitations and account for them to the extent possible. See further guidance in Box 9, p. 100.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of accessibility.
Accessible means: Known to all stakeholder groups for whose use they are intended and providing adequate assistance for those who may face particular barriers to access.
See example components in Table 8 on p. 96 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of predictability.
Predictable means: Provides a clear and known procedure with an indicative time frame for each stage and clarity on the types of process and outcome available and means of monitoring implementation.
See example components in Table 8 on p. 97 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of equitability.
Equitable means: Seeking to ensure that aggrieved parties have reasonable access to sources of information, advice and expertise necessary to engage in a grievance process on fair, informed and respectful terms.
See example components in Table 8 on p. 97 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of transparency.
Transparent means: Keeping parties to a grievance informed about its progress and providing sufficient information about the mechanism's performance to build confidence in its effectiveness.
See example components in Table 8 on p. 97 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it is based on the core criteria of being dialogue-based.
Dialogue-based means: Seeking to resolve grievances through dialogue between the enterprise and the affected party or their representatives. See Table 8 on p. 97 of the G&F Guidance.
The initiative requires the enterprise to ensure that where a grievance mechanism is established, it does not preclude access to judicial recourse (e.g. through legal waivers) for victims of gross human rights violations and the enterprise does not interfere with civil or criminal investigations or human rights examinations.
The initiative encourages the enterprise to publish complaints and incorporate lessons learned into policies and monitoring systems.
The initiative requires the enterprise to seek remedy that restores the affected person(s) to the situation they would be in had the harm not occurred and be proportionate to the significance and scale of the adverse impact.
The concept of remedy aims to restore individuals or groups that have been harmed to the situation they would have been in had the impact not occurred. Where this is not possible, it can involve compensation or other forms of remedy. The remedy or combination of remedies that is appropriate will depend on the nature and extent of the adverse impact and may include apologies, restitution or rehabilitation (e.g. reinstatement of dismissed workers, recognition of the trade union for the purpose of collective bargaining), financial or non-financial compensation (for example, establishing compensation funds for victims, or for future outreach and educational programmes), punitive sanctions (for example, the dismissals of staff responsible for wrongdoing), and taking measures to prevent future adverse impacts.
• If child is engaged in hazardous work, the child is immediately removed from hazardous tasks.
• If the child is above the legal working age according to law or international standards the child has the opportunity to continue his/her employment on appropriate task, but is removed from hazardous work immediately.
• If a child if below the legal working age, the goal of remediation is removing the child from the workplace and ensure alternatives (preferably long- term schooling) are in place.
• For example, the employer may pay the school fees of the child until the minimum ages of schooling.
• The enterprise reviews existing guidance on compensation and back-pay for workers who have not been fairly compensated for their hours worked.
The initiative requires the enterprise to seek remedy that meets national laws and international guidelines on remediation, where available, and where such standards are not available, the remedy provided is consistent with that provided through similar cases.
International guidelines (eg. OECD Guidelines for Multi-national Enterprises) require that remedy is "rights-compatible". This means:
1. Any process for remediation, including a grievance mechanism, should be equipped with the expertise needed to recognise the human rights implications of its work, and effectively integrate human and labour rights standards within its findings and recommendations
2. Where there is a conflict between national norms and international standards, the higher standard should be observed
3. The process for remediation should not support agreements that would be coercive to one or more parties or would violate domestic laws of the parties or international law
The initiative requires the enterprise to engage with affected stakeholders in the determination of the remedy.
• If a child is below the legal working age, the process of remediation includes dialogue with the caregivers of the child.
• The enterprise has consulted external experts to identify any physical harm and the child is appropriately remedied.
• If they exist, the enterprise engages with credible initiatives in the community to help children make the transition from work to school.
• In cases in which a worker has been denied leave, the appropriate form of remedy is agreed upon through dialogue between the enterprise and the worker.
The initiative requires the enterprise to assess the level of satisfaction with the process and the outcome of those who raised the complaints.
The initiative requires the enterprise to collaborate with other enterprises to pool information.
Many enterprises in the garment and footwear sector source from the same countries and suppliers. Sharing information can therefore help increase the awareness of risks of harm linked to specific production processes, countries, sourcng models etc in the sector and bring attention to emerging risks more quickly. Examples where pooling information could be effective:
° The enterprise works towards a common approach to identifying suppliers in the sector; for example, this could mean common supplier registrars or identification numbers.
The initiative requires the enterprise to collaborate with other enterprises to increase its leverage.
Leverage refers to the ability of an enterprise to influence another enterprise. An enterprise’s leverage with its suppliers is important when identifying, preventing and mitigating harmful impacts associated with a supplier. However, there are many reasons why an individual enterprise may lack leverage on its own, such as its small size or its relatively insignificant buying power. Where a single enterprise may lack leverage, a group of enterprises operating together may wield greater leverage, for example by aligning on the activities, timelines and follow-up measures included in a supplier’s corrective action plan.
The initiative requires the enterprise to collaborate with other enterprises, trade unions, civil society, etc. as appropriate to scale-up effective measures for preventing and mitigating risks.
Collaborative initiatives can play a role in scaling up solutions (e.g. policy, training, capacity building, etc.) that have been demonstrated to be effective as well as avoid duplications in programming. Scaling-up can likewise engage SMEs who may have limited resources to initially invest in piloting solutions.
Trade unions and representative organisations of the workers’ own choosing play an important role in preventing harmful impacts on-site through collective bargaining agreements, ongoing monitoring and helping workers to access grievance mechanisms, or providing a form of grievance mechanisms themselves. Workers and trade unions and representative organisations of the workers’ own choosing should be engaged during the development of the corrective action plan, including the design of policies and programmes.
The initiative requires the enterprise to collaborate with other enterprises to increase sector transparency.
Collaboration can help to facilitate the disclosure of aggregate information, for example, on supplier assessments, corrective action taken and measured improvements and therefore increase the transparency of the sector broadly, while enabling individual enterprises to communicate on site-level information as they are ready.
The initiative requires the enterprise to collaborate with trade unions to meaningfully engage workers in the due diligence process.
For example, this may include entering into partnerships/agreements with trade unions.
The initiative requires the enterprise to collaborate with stakeholders and multi-stakeholder initiatives including civil society, governments and trade unions amongst others in the remediation process and provision of remedy, where appropriate.
If numerous parties have caused or contributed to an adverse impact, the enterprise seeks to collaborate with the other relevant parties in the remediation process and provision of remedy.
The initiative requires the enterprise to reduce audit fatigue by carrying out shared assessments, sharing assessment findings, and recognising existing assessments where feasible.
Enterprises are encouraged to collaborate to support recognition of verification, monitoring and validation provided assessments conform to high standards.
The initiative requires the enterprise, where the enterprise participates in a collaborative initiative, to consider how it might contribute towards its effectiveness.
For example, the enterprise may:
• Report instances of harm and emerging risks that it has identified independently;
• Share relevant information on the enterprise’s own operations or suppliers (e.g. share list of suppliers confidentially to the initiative); or
• Provide technical assistance, where appropriate.
The initiative requires the enterprise, where the enterprise participates in a collaborative initiative, to understand which components of due diligence the initiative is helping to facilitate.
For example, if an enterprise is engaged in a collaborative initiative to assess direct suppliers on their occupational health and safety, the enterprise understands and accounts for the fact that subcontractors are not within scope of the initiative and therefore may establish or participate in separate processes to support the assessment of subcontractors. The enterprise understands that it has an individual responsibility to carry out due diligence in respect of their own operations and entire value chains in accordance with OECD standards and the UNGPs.
The initiative requires the enterprise, where the enterprise participates in a collaborative initiative, to represent the scope and results of the initiative accurately in its public communications.
The enterprises' public communications relating to their membership and use of any logos, labels or certifications accurately reflect the initiative’s scope and members’ individual responsibilities under the OECD standards.