Quick Take

A Holiday Season Wish List for Advancing Business and Human Rights in 2025

December 17, 2024

As we are getting close to the holidays and the end of the year, I am reflecting on our work in Business and Human Rights. These are themes, drawn from my research and conversations with colleagues, that deserve our attention and energy in 2025:

1. Impact over Process

A growing number of companies are adopting human rights due diligence processes (HRDD), some out of conviction, some because the laws of European countries will soon require it. HRDD processes, however, will not move the dial on systemic and complex human rights issues unless we shift focus from process to impacts. Instead of measuring the efforts that go into HRDD processes, we should measure impacts for workers and communities. To do this, we need to develop key performance indicators, industry by industry, that assess human rights implications at the heart of the business model. For example, instead of asking manufacturing companies about their human rights policies, let’s ask them about their purchasing practices and the length and quality of their relationships with key suppliers. And if investors would adopt such smart indicators, companies would change their business practices rather sooner than later.

2. Rigor

Advancing human rights in corporate practice requires rigorous analysis.

Without proper diagnosis, we cannot assess the scale and scope of a problem and identify its root causes. Only if we understand the root causes can we define effective remedies. Rigorous analysis needs to apply to materiality and risk assessments as well as to impact measurement. Academics are trained for analysis, but they are often not able to translate their insights into practical recommendations for policymakers and companies. We need to set incentives for academics to make the effort. Academic journals that require outlining practical implications or offer dedicated space to developments in practice, such as the Business and Human Rights Journal and the Journal of Business Ethics, have moved a step in the right direction, but more is needed to align academic incentives.

3. Stakeholder Engagement

With the adoption of the EU’s Corporate Sustainability Due Diligence Directive (CSDDD)and its requirement to develop meaningful stakeholder engagements, some companies are experimenting with how to integrate stakeholder perspectives into their human rights work. Figuring this out is critical for identifying material risks, conducting rigorous analysis and devising effective remediation strategies.

The governance forms that are emerging are manifold, ranging from large annual stakeholder gatherings, to sounding boards to temporary appointment of human rights issue experts. Regardless of the format, to make such engagement meaningful, companies cannot just tick the box by setting up meetings. They need to build solid relationships with key stakeholders. This requires a long-term commitment from both sides to engage constructively and develop solutions to complex human rights challenges. Multi-stakeholder initiatives could provide a platform for such types of engagement.

4. Sustainability

Developing an understanding for the interconnected nature of people and planet in human rights due diligence processes is not optional but just good business. Companies linked to the energy transition, for example, are already well aware of the tensions between advancing environmental and social issues. Wind parks and solar farms can only expand if communities agree to the land use; mining for critical battery minerals can come to a halt if conflict with local communities remains unresolved.

Treating environmental and social sustainability as siloes in corporations is therefore not good for business. Companies need to design a comprehensive sustainability agenda.

5. Education

Human rights education in schools and universities provides the foundation for advancing human rights in corporate practice. Education at business schools is particularly relevant because it can help build the applied leadership skills that the next generation of managers will need to develop solutions for pressing human rights issues. My NYU colleague Professor Michael Posner’s new book illustrates this point compellingly. Business schools are just beginning to get involved, but we stand ready to support them.

Addressing these themes will be critical for making progress. I look forward to advancing BHR with many of you in 2025 and in the years to come!