Largest German companies fall short on human rights ahead of Government deadline
- None of the 20 companies fully demonstrated they meet the range of basic expectations on human rights
- 18/20 (90%) companies failed to sufficiently disclose how they manage their human rights risks through basic due diligence steps
- Almost half (8/20) the companies scored below 40% of the full score available. The highest scoring company was Siemens with 60%.
Berlin, Germany, 4/11/20 – German companies are falling short on tackling their human rights risks ahead of a Government deadline for introducing regulation, according to new research.
A study (out today) assesses the 20 largest German companies by turnover against a world-respected human rights benchmark.
It finds that none of the companies are sufficiently meeting the basic expectations set out by United Nations guidance, with every company scoring zero on at least one of the twelve core human rights indicators.
90% (18/20) failed to fully disclose how they manage their human rights risks sufficiently (due diligence). Just two companies, Daimler and Siemens, received points on all four indicators looking at human rights due diligence processes.
The German government has set a 2020 target for at least 50% of German companies with more than 500 employees to have introduced effective human rights protections. The current coalition Government has agreed to pass laws and push for “EU-wide regulation” if this target is missed.
Yet today’s study finds that, based on their public disclosure, none of the largest companies can show it meets the UN Guiding Principles’ range of basic expectations on Business and Human Rights.
This suggests the wider group of companies being assessed by the German government may fail its test. This could open the door to human rights due diligence legislation.
Almost half (8/10) the companies scored below 40% of the available 24 points. Companies with low scores overall included household names Deutsche Post DHL, RWE, and Deutsche Bank, while Volkswagen scored 10 out of the available 24 points. Siemens was the highest scoring company with 60% (14.5) of the available 24 points.
Phil Bloomer, Executive Director of Business & Human Rights Resource Centre, said:
“German companies have the resources and capacity to lead the way in respect for human rights. However, as a measure of German businesses’ respect for human rights, these results paint a disappointing picture.
“None of Germany’s largest companies were found to meet the basic requirements of respect for human rights, yet all of them are global businesses, many with complex supply chains where evidence shows abuse is endemic.
“The results also suggest that the wider group of German companies being assessed by the German government will likely fall short of the German Government’s threshold. This would trigger a necessary legislative response.”
He added: “These findings lay bare the need for government-mandated human rights due diligence in Germany and internationally to raise the floor of corporate behaviour. Workers and communities that suffer corporate harm can’t afford to wait.”
The study assesses publicly available information for 20 German companies based on core indicators from the Corporate Human Rights Benchmark (CHRB) methodology, applicable across all sectors.*
It covers three areas: Governance and policy commitments; embedding respect and human rights due diligence; and remedies and grievances mechanisms.
Due diligence was the lowest-scoring area overall, with most companies failing to demonstrate they are meeting the UNGP requirements on assessing salient human rights risks.
The study also found that many companies do not explicitly cover workers’ rights in supply chains, engagement with affected stakeholders and access to remedy in their human rights policies, and are failing to demonstrate their grievance mechanisms are effective.
Adam Barnett, Communications Officer, Business & Human Rights Resource Centre, [email protected]
Johannes Blankenbach, EU / Western Europe Researcher & Representative, Business & Human Rights Resource Centre, [email protected] (German speaker, Berlin-based)
Notes to editor:
- The study is produced by Business & Human Rights Resource Centre & ZHAW School of Management and Law. The main author is Herbert Winistörfer from the Center for Corporate Responsibility at ZHAW School of Management and Law who undertook the indicator assessment. The Corporate Human Rights Benchmark team provided guidance and feedback.
- The CHRB is a cooperative venture created by Aviva Group, APG, Business and Human Rights Resource Centre, the Institute for Human Rights and Business, Nordea Bank, and Vigeo-Eiris.
* The study assesses publicly disclosed information on companies' websites, their formal financial and non-financial reporting and other public documents, as of spring 2019.
Corporate transparency is a fundamental condition of the United Nations Guiding Principles (UNGPs) and the CHRB methodology aligns with this. Companies were scored between zero and two across the 12 core indicators. A score of one means they met the basic requirements, and two means they went beyond the basic requirements.