Updated Danish Institute publication demonstrates how businesses across a range of sectors including finance conduct downstream human rights due diligence
"Due diligence in the downstream value chain: case studies of current company practice", 12 October 2023
Note: The publication was updated on 12 October 2023 to include revised text in English on regulatory developments on downstream due diligence and case studies from LBPAM, a French asset management company and ACCIONA, a Spanish infrastructure company.
This publication aims to shed light on how businesses across a range of sectors are already conducting human rights due diligence (HRDD) processes in the downstream part of the value chain, with case studies from companies illustrating their approaches to HRDD across their full value chains...
Business-related human rights impacts can occur throughout the full value chain. Human rights risks arise not only within a company’s own operations or supply chain, but also after a product or service leaves a company, often referred to as the “downstream” part of the value chain. The downstream value chain includes the provision of goods and services to end-users and consumers, how these goods and services are used by other companies or governments, as well as conditions for workers in distribution and logistics or impacts associated with end-of-life disposal of products.
Many companies already undertake some form of human rights due diligence on their downstream value chains. However, they do so in the absence of clear guidance and a coherent regulatory framework that builds on the strong foundation of the UN Guiding Principles for Human Rights and the OECD Guidelines for Multinational Enterprises. Some companies have expressed support for HRDD regulatory initiatives to enhance coherence by adopting a full value chain approach.
This publication aims to inform companies developing their own practice as well as inform the development of smart and coherent policy and regulatory frameworks. It elaborates these concepts through real world case studies of downstream human rights due diligence from a range of sectors and contexts.
The publication covers:
- What the downstream value chain is and why it should be covered in HRDD;
- What human rights issues may arise and who may be affected;
- What can help companies address downstream human rights impacts; and
- Different approaches to downstream HRDD in current company practice, through a selection of case studies:
- Novo Nordisk on expanding anti-bribery and corruption risk processes to cover human rights;
- Reckitt on using value chain human rights impact assessments to identify and address impacts on consumers and end-users;
- Vestas on capturing downstream human rights impacts through its risk-based approach to HRDD;
- Ericsson on enhancing ICT sales processes to screen human rights risks;
- Mærsk on implementing responsible ship recycling standards to integrate human rights in end-of-life disposal;
- Pandora on addressing downstream risks and creating opportunities through responsible marketing practices;
- LBP AM on risk-mapping and using its leverage as an investor to manage human rights risks across its portfolio.
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