Achieving clarity on human rights reporting 

Fri 01 Sep 2023

An important part of reporting on human rights is creating a clear and auditable information trail. As we have seen with the development of the UN Guiding Principles Reporting Framework¹ (UNGPRF) and Assurance Guidance, a clear information trail is crucial to enable assurance of human rights disclosures.  

While every company will have their reporting topics to focus on, there are common issues that impact all companies such as data collection processes, what information is disclosed and whether reporting is balanced, accurate and complete. By focusing on those common issues companies can build a storyboard of where to start, how to proceed and the expected outcomes to provide clarity to reporting topics and ease the reporting and assurance process.  

Appoint a central repository 

With so much input from many different parts of the business, companies can easily lose control of vital data. A central repository that is secure and has effective governance is vital to keep a close track of uploaded data. When setting this up, it’s important to code information clearly and create timelines for the datasets being gathered. A team guiding the process is essential.  

Disclose meaningful and salient information 

An area of tension can be on information that should or should not be disclosed. Here, the UN Guiding Principles on Business and Human Rights (UNGPs) state that information on human rights, whether good or bad, should be disclosed. Stakeholders want to know what progress is being made. Disclosures that suggest everything in the garden is rosy lack the all-important authenticity now expected. Reporting should be about giving people a window into whether a company respects human rights, its challenges and what it is doing to improve. 

Be fair and balanced 

How does reporting look to external stakeholders and regulators? Regulators are increasingly concerned with reports that lack substance and balance. Indeed, under the Corporate Sustainability Reporting Directive (CSRD), there is a requirement to give a fair and balanced account of what human rights impacts a company faces and what procedures are in place to rectify those impacts. It’s important to be honest and authentic; if not, there is a risk of increased scrutiny on social media or regulatory follow-up. Giving a fair and balanced account of human rights impacts allows you to keep control of the narrative. 

Focus on accuracy and completeness 

Accuracy and completeness are two areas that impact the authenticity of human rights reporting. Independent assurance will focus not only on what the report says, but also consider what may not be reported. The assurance provider will also take into account the process for collecting data, its accuracy and reliability. Early engagement with independent assurance providers is important for valuable guidance on the process and whether your approach is likely to pass the accuracy and completeness test.  
Achieving clarity on human rights reporting requires holding up a mirror to your human rights impacts to ensure that reporting gives an authentic reflection. Importantly, reporting is not there to mask poor human rights performance; it is there to demonstrate to regulators that you are aware of the risks, the challenges of addressing them and that you are taking meaningful action.  

1. An initiative developed by Shift and Mazars