Children, a significant portion of the global population, are often marginalised and their needs overlooked. They are key stakeholders of businesses, yet the impact of business operations on them is not always fully considered. Poor management of children’s rights can lead to commercial, legal, operational, and reputational risks for companies. Proactively addressing children’s safety, health, development, and wellbeing is crucial for a company’s social licence to operate and long-term success. The responsibility to protect child rights is supported by international frameworks and principles. Research indicates a correlation between a company’s profitability and its efforts in addressing child rights. Companies that prioritise child rights tend to be stronger, more resilient, and better managed.

Ethical Partners FY21-22 S&P/ASX 200 (+14 ASX 300) benchmarking: A snapshot

The benchmarking exercise revealed the following key findings:

• Less than 1% of S&P/ASX 200 companies disclose a policy commitment to respecting and protecting children’s rights beyond child labour.
• Only 2% identify children as a stakeholder group and engage directly with them.
• 57% disclose philanthropic commitments supporting child rights-based organisations.
• Less than 1% disclose how they integrate children’s rights into their impact assessments.
• Only 2% have publicly disclosed grievance mechanisms that specifically consider child labour.
• 81% disclose a zero-tolerance policy to child labour.
• Only 7% disclose that they address ‘living wages’.

Key takeaways from the report

• Child rights cover a broader range of potential impacts than currently considered: ASX-listed companies need to apply a broader concept of child rights to their corporate policies and practices, considering their impact on all areas of child rights.
• Children’s rights are applicable to all businesses across the ASX: All businesses can address child rights through their direct activities, supply chains, employees, business partners, spheres of influence, community membership, and impacts on wider global and societal crises.
• A more specific child rights lens needs to be applied to existing human rights policies and practices: Children have unique vulnerabilities and needs that may be overlooked in generalised human rights policies. A specific child rights lens is crucial to ensure these vulnerabilities are not overlooked.
• Child rights are not a stand-alone issue but add value to all other sustainability initiatives: Addressing child rights should be embraced as a way to enhance sustainability initiatives, address vulnerable stakeholders, and create a positive impact.
• Relevant disclosures, if present, are often not disclosed to investors or the public: Increased transparency is needed regarding policies and practices related to child rights.
• Many ASX-listed companies consider child rights through philanthropy or community partnerships, as opposed to through their core operations: Companies should consider a deeper and more proactive framing of their impacts on children’s rights.
• It is important to include vulnerable youth (up to 18) when thinking about child rights: The definition of children should extend to vulnerable youth to ensure their unique needs and vulnerabilities are addressed.
• A key finding was the lack of stakeholder consultation and engagement with children by ASX companies: Children’s voices need to be actively sought and included in corporate decision-making processes.
• ASX-listed companies have the potential to champion child rights and adopt leadership in this space: Companies can inspire and mobilise action towards protecting children’s rights, leading by example and collaborating with investors and stakeholders.

Recommendations for S&P/ASX 200 companies based on our “integration of child rights” benchmarking exercise

The recommendations section of Part B of the report offers detailed guidance for ASX-listed companies on integrating children’s rights into their business practices. It is structured into ten steps, each corresponding to specific due diligence and issue indicators from the UNICEF tool.

The steps cover various aspects, including governance, impact assessment, reporting, collaborations, supplier relationships, child labour, decent work for parents and caregivers, child protection and safety, marketing to children, and environment and land use. Each step provides best practice recommendations, examples from ASX companies, and further guidance resources. The overarching goal is to encourage companies to adopt a broader and deeper consideration of child rights, moving beyond philanthropy and integrating child rights into their core business strategies and operations.