
Responsible sourcing: The business case for protecting land and environmental defenders and indigenous communities' rights to land and resources
This reports presents a business case for companies, particularly those with agricultural, timber and mineral supply chains, to take action on protecting and promoting rights of land and environmental defenders (LEDs). It also provides practical steps businesses can take to protect and promote these defenders’ rights.
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OVERVIEW
Land and environmental defenders (LEDs) are a type of human rights defenders. They are focused on the unjust exploitation of natural resources that severely impact the local community and/or environment. They can face significant risks to their safety, for example, in 2018 three LEDs were killed each week, with a large proportion being indigenous people. LEDs often have challenging relationships with those that stand to economically benefit from developments, including companies, some parts of communities, and governments.
The report mentions agriculture, mining and timber industries as the industries most involved in disputes with LEDs, and notes that all companies with connected supply chains should consider the treatment of LEDs. It presents specific guidance for investors and financial institutions to consider the impact they may have and the key elements of these are included below in the Key Insights section.
The case for action
Promoting the safety of LEDs is strongly associated with a stable business environment and should be reflected in a company’s operating policies. With a lower risk of community conflict, companies can reduce costs, increase efficiency, and protect their reputation. These can lead to an increase in value for the business.
Other business case considerations for protecting LEDs include:
- Responsible business practices that include environmental and human rights are becoming increasingly embedded in legislation and a proactive approach to this could be beneficial.
- With sustainability in the investor zeitgeist, proactive measures may be rewarded by investors.
- Neglecting LEDs can involve extensive legal costs.
How to act
This report looks at the ways companies that operate in risky areas can minimise this danger for LEDs and derive a business benefit from them. It presents a process of due diligence that companies should undertake to consider threats to LEDs in their supply chain. These include both preventative mitigation and reactive protection measures and should be developed with guidance from relevant OECD and UN documents.
These steps include:
- Embedding responsible business conduct into policies and management systems including an anti-violence stance towards LEDs and positive positions such as free, prior, informed consent with local communities.
- Identifying and assessing adverse impacts towards LEDs in operations, value changes and business relationships through a risk assessment.
- Ceasing, preventing, or mitigating adverse impacts for LEDs using all available tools.
- Tracking the implementation and results of these due diligent processes for LEDs.
- Communicating how the company is addressing impacts on LEDs.
- Providing for or cooperating in remediation for LEDs where appropriate with adequately supported remediation methods.
- Working with governments to support respectful engagement and justice is available for LEDs.
Supporting the safety of LEDs is not limited to primary industries directly involved in resource extraction but should also be considered by companies that exist further down the supply chain.
KEY INSIGHTS
- Businesses have a role to play in ensuring violence against LEDs does not occur, even if the aims of businesses and LEDs will generally conflict.
- Ensuring that LEDs are protected and respected will have economic benefits for companies working in areas that risk social and environmental damage. These can include preventing legal expenses, ensuring a stable work site, and resulting efficiencies. Less tangible benefits include pre-empting legislative change and investor support for sustainability-related practices.
- Investors should screen their portfolios for risks related to LEDs and require all investments to have policies and reporting on interactions with LEDs.
- Investors should independently verify that any projects requiring land have obtained the free, prior, informed consent (FPIC) of indigenous people and affected communities. This must be meaningful and free of intimidation and/or coercion.
- Reviewing the safety of LEDs should be considered an ongoing process, ensuring that new risks are identified, and mitigation measures are working.
- Investors should consider collectively applying pressure to any companies that are involved in situations where threats or attacks are made against LEDs. This involved consultation directly with LEDs and relevant supporting organisations and the requirement of further prevention and mitigations measures.
- Businesses should publicly condemn any threats or violence against LEDs and push state authorities to take effective action against any that do occur.
- The OECD Guidance for Responsible Business Conduct provides a comprehensive set of principles for responsible business conduct including risk-based due diligence and supply chain management in regards to human rights. The UN Guiding Principles on Business and Human Rights also provide further information. These are both useful resources for companies developing LED related policies.
- The average global operating costs of a three-year investment of around USD$10 million could be up to 29 times higher if the project were forced to stop its activities due to local opposition. By leveraging their influence to create a positive impact, businesses can convert risks into opportunities, improve supply chain resilience and capitalise on market demand for sustainable products.
RELATED QUOTES
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“Human Rights are the foundation of a healthy society and sustainable business. Given the increasing vulnerability of human rights defenders and shrinking space where they can operate safely, business has a role and responsibility to defend and promote fundamental rights and freedoms.”
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“The business case is clear: companies depend on a strong civil society, rule of law and respect for human rights.”
Page number or webpage section: 9 -
“Of course, my life is at risk. I receive death threats 24 hours a day because I’m not going to shut my mouth in the face of this atrocity.”
Page number or webpage section: 5- Maria do Socorro Costa da Silva, Community campaigner