Business and human rights: reporting and measuring

Better corporate measurement and reporting on social impact will probably promote better performance -- but not necessarily.

Many in business are overwhelmed by the proliferating plethora (had to try that...) of guidelines and reporting frameworks, standards and metrics for sustainable and responsible business.

In a previous post (here) I've noted the compliance fatigue and other problems that result from this phenomena.

In theory, firms that measure and report on their human rights or other social, environmental and governance impacts thereby also become more attuned to these in strategic and operational terms, 'mainstreaming' them into their business practices and decisions. 

(In parallel, many of these issues around social and environmental impact -- triple bottom line, non-financial due diligence, or whatever one wishes to call it -- are coming in from the periphery to the core of commercial considerations.)

However, it is not necessarily the case that more reporting, more measuring, etc., equips corporate decision-makers to be better at seeking out more socially beneficial or enviro-friendly ways of operating. Nor do they necessarily improve transparency and accountability (even if they force firms, or parts of firms, to engage with the ways in which they affect people and the planet, and give watchdogs something to audit). 

The effect of widespread uptake and implementation of reporting frameworks might be profound in shifting business cultures. But the effect is not automatic. It depends. In particular, not all firms have good feedback loops: externally-facing reporting will not necessarily change management mindsets.

Creating these frameworks, indices, matrices should not be an end in itself, therefore.

There is scope for more research on links between corporate responsibility reporting and business practices, and related frameworks for the finance sector -- whose practices hold so much influence over corporate practices in turn.

The prompt for this post is my briefing paper, published last week for Chatham House, on trends in the field of 'business and human rights'. See here.

Also published last week was the very promising first detailed guidance for corporates on reporting on efforts to implement the 2011 UN Guiding Principles on Business and Human Rights. See here.

Finally, last week but one saw the publication of this brief guidance to corporates on due diligence in relation to human rights issues. See here.

All this is good, provided the business and human rights 'community' does not deceive itself that more publications, more guidelines, more frameworks will necessarily, of themselves, make the difference.

Jo