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Blog | Wednesday July 26, 2017

Luxury, Sustainability, and Desirability: Two New Rules of the Game

Preview

On July 11, BSR brought together a group of luxury brands at Paris’ “Salon du Luxe” conference to talk about the new rules of the game when it comes to desirability, sustainability, and luxury.

In the past several years, the growth of the luxury industry has slowed, and aspirational brands such as Michael Kors and the Hoxton Hotels have disrupted the sector with different interpretations of “luxury” products and services that offer more open and experiential approaches or less expensive products. At the same time, industry demographics are changing: Millenials and Gen Z now account for about 30 percent of luxury shoppers and will represent 45 percent of the market by 2025. Luxury brands need to account for the preferences and shopping habits of these younger generations, who are more eco-conscious but also less loyal and more digital.

Some brands are suffering in this changing context. A Nelly Rodi/IFOP study based on a trends analysis and survey of 1,000 global luxury consumers found that consumers no longer find many traditional brands desirable. Instead, brands like Apple are capturing the hearts and minds of luxury clients.

So, how can traditional luxury brands adapt and stay relevant? During the Salon du Luxe event, we discussed two emerging and related rules of the game when it comes to changing consumer psychology and behaviors. First, sustainability creates desire; second, to be desirable, brands must be sustainable. These rules—two sides of the same coin—describe desirability for products and services in terms of both demand and supply.

Rule No. 1—The Demand Side: Sustainability Creates Desire

In some respects, Amazon’s acquisition of Whole Foods perfectly exemplifies status-seeking consumers’ new mood when it comes to all things organic, eco-conscious, and local: “I want it.”

Luxury status today is increasingly expressed in the “language of conscious consumerism.” Trendwatchers say luxury consumers are keen to express who they are in terms of being “ethical, creative, connected, and tasteful.” They are less keen to simply possess more goods.

Why do these choices symbolize luxury? Consumers are expressing their high education levels and cultural awareness through their purchases and lifestyle, which include everything from yoga to biodynamic wine. Brands are beginning to recognize this shift in mindset, which affects not only their clients, but also their employees.

During our panel discussion at Salon du Luxe, brands reported that customers are starting to ask more questions about the origin of ingredients and raw materials, animal welfare, and social and environmental impacts of products more broadly. Sandrine Noel, environment manager at Louis Vuitton, said that they can even “observe new demands from their 'VICs'—Very Important Customers,” like actress Emma Watson, who recently requested a selection of conscious garments.

Rule No. 2—The Supply Side: To Be Desirable, Brands Must Be Sustainable

Over the past several years, many luxury brands have adopted stronger environmental and social practices, prompted by a strong business case and stakeholder demands. Luxury brands are investing in sustainability to protect their exceptional quality raw materials from climate change, to respect implicit client expectations about social and labor practices, and to support community and cultural life alongside their top clients. For Jerome Schehr, CFO of the Shangri-La Hotel Paris, “luxury brands now have to be respected and respectable if they want to be desirable in the eyes of their customer.” From his perspective, companies can foster respectability by adopting a robust and coherent sustainability approach.

Indeed, a new argument in favor of brands adapting strong environmental and social practices is emerging: Sustainability is a lynchpin of desirability. The Nelly Rodi/IFOP study recommends that brands improve their desirability by activating certain levers that include proximity and taking a stand. Proximity is about how a brand positions itself from one of distant authority to one that facilitates sharing and interaction. Delving into the Hoxton Hotel example, the hotels’ positioning and communications reflect a warm, interactive mood, made tangible through curated events that are open to the public, lots of lobby space for communal working, and a tone that solicits guest feedback.

Taking a stand is about how a brand manifests its point of view on the world, makes commitments (whether to values, culture, the environment, ethics, or society) and shares it values. Tiffany and Company represents an envy-worthy example through its public activism on climate change, support of eliminating coral from jewelry, and work to protect special places such as Bristol Bay in Alaska. In this sense, sustainability commitments and activities are an ideal ally for a brand looking to reinforce its desirability.

Increasing the “supply” of sustainability in luxury is both about the substance of the company’s actions and its public communications about its activities and values. This presents the next question luxury brands and marketers need to tackle: how to credibly communicate on sustainability activities, ethics, and values in ways that fit with brand DNA and reinforce brand equity. Brands also need to summon their courage. Most companies are working to improve their environmental and social practices, and have long roads ahead. This shouldn’t stop brand owners from using their reach and influence to speak out in authentic ways that move the agenda forward.

Cécile Koenig, Guerlain’s skincare director, international marketing, explained that her company has made commitments to protect biodiversity, with a focus on its iconic raw materials such as orchids, vetiver, sandalwood, and lavender. These are the kinds of commitments that not only help protect luxury supply chains, but also enhance Guerlain’s ability to connect with customers and reinforce the brand’s appeal.

By following these two new rules of the game, luxury companies have the opportunity to expand the market for sustainable goods and services—something that’s desirable for customers, business, and the planet.

To learn more about sustainability and desirability, contact us or read about our Responsible Luxury Initiative.

Blog | Tuesday July 25, 2017

The State of Sustainable Business in 2017: Results from the Ninth Annual BSR/GlobeScan Survey

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Just how much change can happen in one year? The past 12 months have been incredibly volatile, with political, economic, technological, social, and environmental disruptions creating both challenges and opportunities for companies. BSR and GlobeScan’s State of Sustainable Business Survey 2017—our ninth annual survey of BSR members—explores what these changes mean for sustainable business.

The great news is that BSR members remain steadfast in their commitment to sustainability and recognize that business must play the leading role in advancing sustainability in the future. The question, therefore, is: How can business lead in this dynamic environment?

The State of Sustainable Business Survey, released today, includes responses from nearly 300 business leaders representing 151 global companies—more than 60 percent of BSR’s global membership network.

Interestingly, when asked about priorities for the sustainability function in 2025, most respondents said they expect to focus on the same kind of activities they are addressing today. But given the rapid pace of change, this will not be enough. To address the needs of 2025, businesses will need to evolve their sustainability efforts. Today’s incremental approach to improvements will be insufficient. 

The world is changing, and to keep pace, sustainability strategies must as well.

For example, less than a quarter of respondents said they believe addressing implications for workers due to automation/technology will be a high priority. Yet we know that labor is undergoing a profound transformation across nearly every sector, from retail to manufacturing. This means current activities on worker rights will need to change dramatically. Similarly, only 16 percent of survey participants said that responding to crises will be a high priority, and only a third said they believe scenario planning will be important.

At BSR, we believe both activities will be essential for sustainability teams. It is time to redefine sustainable business with a new agenda, a new approach, and a new voice. 

As we think about redefining sustainable business for the future, we know that it will include different issues and different partners. In terms of issues, it has become clear that basic economic fairness must be intertwined with sustainability. That’s why BSR is working with business to drive a more inclusive economy—one that enables all individuals and communities to participate in, benefit from, and contribute to the economy.

We were pleased to see that nearly two-thirds of respondents are prioritizing inclusive growth within their companies—a 7 percent increase over last year. Yet that means that one-third of respondents still have not made the connection between sustainable business and inclusive growth. And even among those who have, there is a huge opportunity to invest in areas that will drive the most impact. For example, 78 percent of those companies place low or no priority on locating facilities in areas of high unemployment, and only 14 percent place a high priority on influencing governments for more inclusive public policy. Last week, my colleague Susan Winterberg shared some great examples of how business can lead on driving inclusive growth, from improving retail jobs to impact sourcing.

In terms of different partners, sustainability practitioners have long focused on external collaboration and engagement, with peer companies, NGOs, multilaterals, and others. These partnerships have been critical in creating systemic change. But there is a clear opportunity for companies to integrate sustainability across more internal functions. This is happening in some companies, especially with CEOs and supply chain or procurement teams, but not with some critical internal functions. More than 60 percent of respondents state that customers/consumers, investors, employees, and governments influence their sustainability agenda. Yet those same respondents are not integrating with the key internal partners most likely to influence those key stakeholders. For example, less than 10 percent of respondents prioritize close partnerships with marketing, investor relations, or public affairs. And they prioritize human resources, at 12 percent, only slightly more.

While every organization has its own unique structure, deeper partnership inside companies with these key functions will be essential to achieve greater progress. For example, Intel’s corporate responsibility team has worked for many years with investor relations and corporate governance to drive an integrated approach with investors on ESG. And BSR’s Sustainable Lifestyles Frontier Group—AT&T, eBay, Johnson & Johnson Consumer Inc., McDonald’s, and Walmart—recently published "Big Brands, Big Impact: A Marketer’s Guide to Behavior Change."

As we get ready for BSR’s 25th Anniversary Conference, I look forward to discussing how companies can redefine sustainable business to meet the challenges of the future, and how we can rethink our approach to change inside and outside companies. 

We have finally reached the point where there is no question if business will lead. Now we must answer how. 

Blog | Wednesday July 19, 2017

Inclusive Growth: How Business Leads

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Turn on the news on any given day and the lineup of stories is often the same: an economic report of flat wages and rising financial insecurity combined with tales of social unrest and political instability around the world. Beneath all these seemingly disconnected events lies one common thread—inclusive growth.

The Organization for Economic Cooperation and Development (OECD) defines inclusive growth as “economic growth that creates opportunity for all segments of the population and distributes the dividends of increased prosperity, both in monetary and non-monetary terms, fairly across society.” A lack of inclusive growth has been tied to everything from higher rates of cancer and crime to voting for populist leaders to joining terrorist groups.

Creating more inclusive forms of economic growth has long been seen as the responsibility of governments and civil society. Yet in the last few years, it is increasingly being taken up by the private sector as a central pillar of company sustainability platforms. According to the 2017 BSR/Globe Scan State of Sustainable Business report, which will be published later this month, the number of companies that say they consider inclusive growth a "high priority" for sustainability efforts has increased almost 10 percent since last year.

Companies are taking action on promoting inclusive growth through three main mechanisms: creating good jobs, expanding access to products, and engaging with society.

Creating Good Jobs

A 2016 survey by JUST Capital found that the U.S. public considers providing good jobs as the most critical sustainability issue facing companies today. Some companies are rising to this challenge. IKEA, for instance, made a commitment in 2014 to pay its U.S. retail workforce a living wage. Other areas where companies are beginning to think about good jobs include treating contingent workers more fairly, investing in training and career paths, creating predictable scheduling, increasing benefits coverage, and developing profit-sharing programs.  

Companies are also starting to develop ways to expand their diversity and inclusion efforts to include more groups who face challenges in employment. Member companies of the Global Impact Sourcing Coalition are focusing on ways to improve inclusion in their supply chains through encouraging their suppliers to offer job opportunities to neglected groups, such as long-term unemployed persons, informal sector workers, and “neurodiverse” workers. Some companies are exploring how to bridge geographic divides through “rural sourcing” programs, which hire people from high unemployment rural communities in the United States. There’s even a small group of companies focusing efforts on preventing violent extremism by offering economic opportunities to youth in communities that are targeted by terrorist recruiters.

Expanding Access to Products

Access to affordable and high-quality products in housing, basic infrastructure, healthcare, food, and financial services is a critical component to inclusive growth. Many companies now have access policies and programs for their products. One example is MasterCard’s Center for Inclusive Growth, which uses proprietary technology platforms and big-data capabilities to connect microentrepreneurs, refugees, and other excluded groups to affordable financial services products. The United Nations’ Business Call to Action has secured inclusive business commitments from more than 190 companies to expand access to critical goods and services to the poor in developing countries. Chobani’s founder and CEO Hamdi Ulukaya formed Tent Partnership for Refugees which has organized commitments from companies to improve critical product access to refugees. Doug Rauch, a former president of the grocery store Trader Joe’s, started the The Daily Table, which has organized more than 40 grocery chains and food brands to tackle the challenges of food deserts and malnutrition in U.S. inner cities.

Engaging with Society

Community and government engagement for inclusive growth has long been a focus in the extractives industry, where maintaining a ‘social license to operate’ has been a central focus. Yet the range of industries, geographies and policy issue areas in which business is engaging is expanding.

The last few years have seen a growing tide of "CEO Activism." Earlier this year more than 150 CEOs signed an amicus brief on the U.S. executive order on immigration. This trend could continue in the coming years as businesses weigh in on other critical inclusion policy issues such as U.S. universal access to health care. Other dialogues are also forming at the multilateral level such as the OECD’s Business Leaders for Inclusive Growth and at the “B20,” which is the business platform at the G20. These platforms can provide ways for business’ collective voice to promote fairer and more inclusive policy frameworks for global trade, immigration policy, digitalization and skills, and other global economic challenges.

Inclusive growth is one of the great challenges of our time. Yet through commitment, collaboration, and action, business is showing that it can move from being a central source of the problem to a central driver of the solution. 

Blog | Tuesday July 18, 2017

Impact Sourcing and Inclusive Supply Chains: A Conversation with Bloomberg and Digital Divide Data

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The next wave for employment in outsourcing is not about finding the next location; it’s about thinking more inclusively when tapping local talent. Through Impact Sourcing, companies benefit from offering good job opportunities to disadvantaged people in any country they source services from, including the United States.

During a breakfast event held by BSR's Global Impact Sourcing Coalition (GISC) in New York, we spoke with Erin Lambert, global head of sourcing for Bloomberg’s Global Data Division, and Jeremy Hockenstein, CEO of Digital Divide Data, about their partnership to provide good job opportunities to underemployed populations in the United States. This interview was conducted by Jon Browning, CEO of Strategic Sourcing Advisors.

Jon Browning: Jeremy, tell us about Digital Divide Data’s work, and your partnership with Bloomberg.

Jeremy Hockenstein: A few years ago, one of our board members approached us to see if we could do Impact Sourcing in the United States, given our successful workforce development and employment programs in other countries. This was the beginning of our U.S. program, Liberty Source, which focuses on employment opportunities for the military community, including military veterans and military spouses.

Most of us are aware of the difficulties many veterans have transitioning to civilian employment, but you might be surprised to learn that military spouses are more likely to be unemployed than the average population, with an unemployment rate of 30 percent, which is six times higher than their civilian counterparts (at around 5 percent). They often cannot find work flexible enough to accommodate their spouse’s schedule or deployments. Through Liberty Source, we are able to offer stable work with more flexible work options, and as a result have a loyal, highly educated workforce that can deliver great value to our clients. Our partnership with Bloomberg has really been key in helping build our U.S. business.

Browning: Bloomberg has been working with its suppliers on Impact Sourcing for several years now. Erin, tell us about your experience to date.

Erin Lambert: When Bloomberg partnered with Liberty Source in 2015, our goal was to find a location and a partner to replace the need for contingent workers locally. We found that partner in Liberty Source, and our relationship continues to expand.

Most of the Liberty Source team have a university degree, and several have multiple degrees. I think one success factor is that we don’t just set up the work and forget about it; we visit the facilities in Virginia. And we enjoy visiting! I’ve got trainers who beg me to go there because they enjoy working with the Liberty Source team so much; they treat them as an extension of our internal teams. Impact Sourcing engages both hearts and minds. It is meaningful to Bloomberg employees that we are enabling military spouses to work remotely while their husbands or wives are deployed.

We are also sourcing from a provider in India that operates in remote villages outside of Kolkata, employing undereducated youth who would otherwise have to migrate to the large cities to find jobs. In visiting these job sites, I’ve met employees whose families were previously living below the poverty level. Through Impact Sourcing, the provider has been able to bring up the employees’ family income as much as 400 percent to 500 percent. Once you’ve visited some of these facilities in these countries, you’re even more dedicated to finding commercial ways to help make this work.   

Browning: Digital Divide Data also does work internationally. Jeremy, what are some of the differences between the work you do in the United States versus the work you do in other locations?

Hockenstein: Our operations first started in Laos, and then we moved to Cambodia and Kenya, where we targeted very talented high school graduates who couldn’t afford to go to university. We learned we could tap into a motivated, talented population who, without training and work, would be stuck in a cycle of poverty. Our work-study programs in those countries provides our employees about 35 hours of work a week plus scholarships and loans to go to university. In the United States, most of our employees come to us with higher levels of education, so we don’t need as much pre-employment training as we do internationally.

No matter where we operate, we see these jobs as stepping stones to future opportunities and career growth, maximizing the impact for employees. Even from the beginning, we had high retention rates compared to the average for the business process outsourcing industry, with new employees staying more than four years with us before moving on to bigger roles elsewhere. With higher employee retention, we are able to offer training in more advanced skills and a career progression that does not come with short-term employment. And this strategy has been good for our clients and our business. 

Browning: Erin, have you had any challenges in introducing Impact Sourcing within Bloomberg?

Lambert: Philanthropy and corporate social responsibility are deeply engrained in Bloomberg’s corporate culture, so there actually haven’t been a lot of challenges internally.

The only concerns that have been raised are whether our Impact Sourcing providers could continue to grow as Bloomberg grows. We have partnered with Liberty Source for over a year. They’ve grown a lot with us already, and we have a growth strategy in place that I’m pretty confident we will achieve together.

Browning: Erin, as a member of the GISC, what opportunities do you see through a collaborative approach to advancing Impact Sourcing?

Lambert: The Coalition has grown even since Bloomberg joined a couple months ago. For us, the value in participating in the GISC will come when we are able to evaluate the true social impacts of inclusive employment. Until then, it’s important for companies like Bloomberg to step up and talk about our work, and encourage other companies to follow. There’s an opportunity for others to learn from our experience, to hear that, yes, we are working on Impact Sourcing, and when issues have come up, here’s how we worked through it.

Blog | Wednesday July 12, 2017

Insights from Telia Company’s Human Rights Impact Assessments

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This week, Telia Company published the human rights impact assessments (HRIAs) undertaken by BSR of the company’s subsidiaries in Sweden and Lithuania. This follows the company’s earlier publication (in summary form) of similar HRIAs undertaken by BSR of the company’s subsidiaries in Azerbaijan, Georgia, Kazakhstan, Moldova, Tajikistan, and Uzbekistan.

Taken together, these publications by Telia Company represent an impressive commitment to transparency on human rights impacts and how they are addressed. This level of transparency remains rare in the business and human rights field, and we hope these steps by Telia Company are frequently cited as a leading example for other companies to follow.

These HRIAs represent a substantial body of work. Along the way, BSR and Telia Company gained many new insights into how to apply the UN Guiding Principles on Business and Human Rights, and we want to share four of them here:

• Stakeholder and rightsholder engagement is essential. To develop the eight HRIAs, BSR and Telia Company met with around 100 stakeholders and rightsholders, including human rights defenders, advocates, policymakers, diplomats, and regulators. Some were experts in telecoms, while others were not; some focused on the broad human rights agenda, while others specialized in specific areas, such as privacy, LGBTIQ+ rights, or gender equality. While companies can be hesitant to engage externally, with the right preparation, companies can gain valuable insights from these conversations and forge new relationships that are essential for the successful implementation of HRIA recommendations.
• Transparency by companies on human rights issues has impact. Over recent years, a number of internet and telecoms companies, including Telia Company, have become much more transparent in their approach to freedom of expression and privacy, especially when it comes to how they respond to government demands that risk violating the human rights of their users. These reports can be long and detailed, so it is tempting to assume they sit unread on a digital shelf. They are not—indeed, quite the opposite. In these Telia Company HRIAs, and in HRIAs BSR has undertaken with other internet and telecoms companies, it has been striking to learn how local human rights defenders and advocates have put them to use—for instance to inform their policy positions.
• An industry lens is required. The UN Guiding Principles on Business and Human Rights are written for all companies in all industries, so applying them to a specific telecoms company raises new questions that require industry knowledge. What is the responsibility of a telecoms company when compliance with local laws, regulations, and licenses can result in human rights violations? How can telecoms companies reconcile the huge freedom of expression benefits of their services with their accompanying risks? What unintended consequences does a telecoms regulatory change have in a country with strong rule of law (such as Sweden) when that same change is replicated in countries without the same legal protections? How will disruptive technologies, such as artificial intelligence and the internet of things, alter human rights risks? Industry organizations such as the Global Network Initiative can help explore what these questions mean for telecoms companies.
• The link between ethics and human rights is strong. While freedom from corruption is not a human right, it was clear throughout our assessments in all eight countries that there are strong links between ethics, corruption, and human rights. An ethics violation—such as the selection of an unqualified supplier with poor health and safety practices—can result in significant human rights consequences. The victims of both ethics and human rights violations are often the most vulnerable populations. Upon completing the HRIAs, we became even more convinced of the need for holistic approaches to manage ethics, corruption, and human rights. We even believe a case could be made to acknowledge freedom from corruption as a human right.

We hope Telia Company’s publication of these HRIAs serves three key functions. First, we hope it enhances Telia Company’s ambition to integrate human rights into business decision-making. Second, we hope it informs further dialogue on human rights in the eight markets covered. And third, we hope it provides insights for the broader business and human rights community on how to undertake HRIAs.

Indeed, we at BSR are also taking a risk by being transparent about our own work. We are committed to being at the leading edge of business and human rights methodology, and we believe our approach can be improved by transparency and constructive criticism. Both Telia Company and BSR look forward to feedback and dialogue. 

View the full case study of our human rights impact assessments for Telia Company.

Case Studies | Wednesday July 12, 2017

Telia Company: Human Rights Impact Assessments

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BSR helped the telecommunications firm Telia Company integrate human rights into business decision-making in two ways: Human Rights Impact Assessments (HRIAs) in six Eurasian markets where the company is exiting and HRIAs in two European markets where the company continues to invest.

The Challenge

In September 2015, Telia Company announced its intention to divest from Region Eurasia, including through the sale of its subsidiaries in Azerbaijan, Georgia, Kazakhstan, Moldova, Tajikistan, and Uzbekistan. For this reason, Telia Company sought to create a “responsible divestment plan” that would take into consideration the human rights impacts, risks, and opportunities arising from the divestment, including:

• How to minimize human rights risks from the announced sale.
• What to look for in the due diligence of potential buyers, such as their human rights record and commitments.
• What activities to undertake during the sales period, such as using the final HRIA reports to build the capacity of the buyer to manage its new assets with respect for human rights.

At the same time, Telia Company announced its intention to invest in a new generation of products and services in its European markets, such as the internet of things, entertainment, and security. Telia Company sought to understand the actual and potential human rights impacts in these markets, and how to address them in its policies, strategies, and plans.

Our Strategy

For each of the eight markets (the six Region Eurasia markets, plus Sweden and Lithuania of Telia Company’s European markets) BSR undertook HRIAs using methodologies based on the UN Guiding Principles on Business and Human Rights. For each HRIA, BSR completed four phases:

• Immersion, where we built knowledge of the company and the local context through document review, company interviews, and meetings with subject matter experts.
• Mapping, where we visited the country to identify actual and potential human rights impacts with local stakeholders and rightsholders.
• Prioritization, where we reached conclusions on where Telia Company and its subsidiaries should focus their human rights efforts.
• Final report, where we made recommendations for a company human rights action plan over the short, medium, and long term, and reached conclusions about the use of company leverage.

For the six Region Eurasia markets BSR made recommendations to Telia Company for how to integrate human rights into the sales process through a responsible divestment plan, and to each subsidiary and its future owners for how to manage and mitigate human rights impacts during the ongoing management of the companies.

For the two European markets BSR made recommendations to Telia Company for how to integrate human rights into its companywide strategy, governance, and management, and for the local subsidiary we made recommendations for how to manage human rights impacts in that market.

Our Impact

The impact of this work will arise through the implementation of BSR’s recommendations, which covered a diverse range of human rights issues, such as privacy, freedom of expression, non-discrimination, security, land rights, child rights, and labor rights.

In Region Eurasia, Telia Company has implemented BSR’s recommendations by undertaking human rights due diligence of potential buyers and sharing the HRIAs with them. Both Telia Company and the local subsidiaries have maintained human rights action plans and tracked progress over time.

Similarly, in Sweden and Lithuania, Telia Company is creating and maintaining action plans to implement recommendations and track progress. The implementation of these human rights action plans is overseen by Telia Company’s Governance, Risk, Ethics, and Compliance Committee.

In addition, Telia Company has published the Sweden and Lithuania HRIAs, and summary versions of the Region Eurasia HRIAs.

Lessons Learned

BSR and Telia Company gained many new insights into how to apply the UN Guiding Principles on Business and Human Rights in practice.

• Stakeholder and rightsholder engagement is essential. Across the eight HRIAs BSR and Telia Company met with around 100 stakeholders and rightsholders from a wide range of backgrounds. We met with human rights defenders, advocates, policymakers, diplomats, and regulators. Valuable insights were gained, and new relationships were forged that will be essential for the successful implementation of HRIA recommendations.
• Transparency by companies on human rights issues has impact. Over recent years a number of internet and telecoms companies, including Telia Company, have become much more transparent in their approach to freedom of expression and privacy. While these reports can be long and detailed, it has been striking to learn how many insights local human rights defenders and advocates gain from the reports, and how they are put to use.
• An industry lens is required. The UN Guiding Principles on Business and Human Rights are written for all companies in all industries, so applying them in a telecoms industry context raises all sorts of challenging questions—for example, how disruptive technologies such as the internet of things alter human rights risks, or how companies navigate situations where compliance with local laws, regulations, and licenses can result in human rights violations.
• The link between ethics and human rights is strong. While freedom from corruption is not a human right, it was clear throughout the HRIAs that there are strong links between ethics, corruption, and human rights. An ethics violation—such as the selection of an unqualified supplier with poor health and safety practices—can result in significant human rights consequences, while the victims of both ethics and human rights violations are often the most vulnerable populations.

Most of all, these HRIAs illustrated the importance of a proactive approach to integrating human rights into business decision making. Without the intelligence gathering required by the HRIAs, Telia Company’s senior decision-makers would have fewer decision-useful insights available on important issues of material significance to the company.

Blog | Tuesday July 11, 2017

How Business Can Support the Global Movement for Family Planning

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Maternal deaths are the second-biggest killer of women of reproductive age globally: Every two minutes a woman dies from complications in pregnancy and childbirth, with 99 percent of these women living in developing countries. Research by the Guttmacher Institute shows that around 40 percent of the 190 million pregnancies in the developing world in 2012 were unintended, and that about half of them ended in abortion. Unsafe abortions are recognized as one of the main drivers behind pregnancy-related complications and the leading cause of death among women aged between 15 and 19 globally.

The most effective way to avoid unintended pregnancy is through correct and consistent use of contraceptives. Yet an estimated 225 million women in developing countries who would like to delay or prevent pregnancy do not have access to any method of contraception.

Today, the international community is coming together for the Family Planning Summit 2017. It has been exactly five years since the 2012 London Summit on Family Planning adopted the ambitious goal of enabling 120 million more women and girls to use contraceptives by 2020. So far the global partnership for Family Planning (FP2020) is making progress, and an estimated 34 million more women are now using modern contraceptives. This indicates a clear acceleration compared to historical trends, but also suggests that we are not making progress fast enough to reach the FP2020 goal.

Now we need to pick up the pace. Achieving the FP2020 goal is a critical milestone for ensuring universal access to sexual and reproductive health and rights by 2030, as laid out in the Sustainable Development Goals. The international family planning community is calling on the private sector to join the global movement to enable women and girls to use contraceptives.

What does women’s access to family planning have to do with your business?

Access to safe, voluntary family planning is a human right. Accessing family planning services is essential for women and girls to be able to stay in school, join the workforce, and—crucially—remain active in the formal economy. Women play a key role in the global workforce, and their participation in the formal economy is critical for economic growth and for companies’ ability to recruit and retain workers. A recently published report by the Asia-Pacific Economic Cooperation recognizes health issues, including not having access to family planning, as critical barriers to women’s economic participation.

Promoting women’s access to family planning does therefore make good business sense, and business can play an important role in supporting more women and girls with access to family planning. Global supply chains—especially those with a high concentration of women workers in factories—present a major opportunity to connect women to comprehensive family planning services. BSR’s HERproject has implemented HERhealth programs over the past 10 years, improving health outcomes for more than 600,000 low-income women workers. Our impact data show increased awareness of the benefits of using family planning as well as an actual increase in the use of contraceptives among women workers. However, our experience tells us that we need to increase investments in workplace health systems to ensure full access to family planning for women workers.

Therefore, we are presenting a new approach for investing in workplace health systems to deliver for women, their families, and communities. Together with The Evidence Project/Raise Health Initiative, we have developed a set of resources to build the capacity of workplace managers and clinic staff to manage workplace health services and to implement health awareness-raising activities.

Investing in workplace health systems means that factories and farms can:

• Improve women workers’ access to critical health services, both in the workplace and outside the workplace through stronger referral systems.
• Increase the capacity of top managers and clinic staff to manage workplace health, and to run the health clinic as a strategic business resource.
• Sustain impact after the formal completion of HERhealth by creating an enabling environment for workplace health and local ownership.

Partnering with factories and farms to help them invest in workplace health systems is an essential component of HERproject’s efforts to ensure women workers have access to comprehensive family planning, and to support their right to decide whether, when, and how many children they want to have. Investing in workplace health systems will not only promote women’s health outcomes and right to health, but also will enable women and girls to participate in the formal economy more fully.

Women’s health—including sexual and reproductive health and rights—remains central to HERproject after 10 years. We are calling on companies to accelerate efforts to ensure access to family planning for women around the world. Business has a unique opportunity to invest in women working in global supply chains, and by actively partnering with local suppliers to improve workplace health systems, you can join a powerful movement to ensure women have control over their lives—for everyone’s benefit.

Blog | Monday July 10, 2017

Shape the Future of Sustainable Business at the BSR Conference 2017

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The BSR Conference 2017 will serve as the centerpiece of our 25th anniversary celebration. So much has changed since BSR launched in 1992. Our very first Conference, in Washington, D.C. in 1993, brought to the plenary stage a new president in his first year: Bill Clinton. President Clinton embraced a view of business that would make a meaningful difference in enabling people to reach their potential, of businesses that knew that a healthy environment was central to their success. He also knew that global trade could—done right—lift billions of people out of poverty.

While the view from Washington looks different in 2017, there is no doubt that in the previous quarter-century, we have developed an amazing ecosystem of sustainability leaders. I am exceptionally proud of the role BSR has played in building a real movement of changemakers in business.

At our 25th annual Conference this year, we certainly will celebrate what we have accomplished, in collaboration with our great network of member companies and other partners. But even more, we will take the opportunity this October to look resolutely to the future.

This year’s event will create the opportunities for networking and learning that so many have come to expect from the BSR Conference. 

In keeping with our approach to the 25th anniversary, we are taking the opportunity to redefine sustainable business—and the Conference as well. The venue itself will provide new opportunities for informal interaction in an inspiring beach-side setting. We have built an agenda that will take full advantage of the natural environment—from our opening night reception and dinner by the ocean to our closing 25th anniversary celebration overlooking Huntington Beach.

The theme for the Conference is “How Business Leads.” At this moment in history, business leadership is essential. More and more, sustainability leadership is crucial to successful business. Sustainability presents unique opportunities for innovation and value creation. Businesses lead through powerful collaborations that are fit for a world of distributed assets and diverse perspectives. And in today’s climate, the voice of business is crucially important, as other sectors often abdicate their leadership responsibilities. 

We have shaped a Conference agenda that will look to the future. This comes at a time when technology, economics, and politics are rewriting the sustainability playbook. We have dedicated a special track, “FastForward 25,” to sessions that will project the kinds of changes that business can create to make good on the promise of the Paris Agreement and the Sustainable Development Goals. Fitting with our location in California, from where so much innovation comes, we also will have multiple speakers looking at new business models, new collaborations, and new ways of engaging consumers.

BSR’s first Conference brought together a small but mighty band of believers who had a vision of a new way of doing business. Today, our numbers are greater, and the vision remains just as powerful as it once was. The scope of our opportunity is just as powerful, too.

Every year, I am excited by the prospect of being with many great leaders whom I consider to be friends and partners. This year, at the intersection of BSR’s 25th anniversary, serious disruptions affecting business, and the need for business leadership and voice, the question I have found myself asking is: “How will we meet this unique moment?” 

Come to BSR17 to shape the answer: Our shared future depends on it.

Blog | Wednesday June 28, 2017

BSR Collaborates with Indian Business Association to Address Sexual Harassment in Garment Industry

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Violence against women is one of the world’s most prevalent human rights violations. In India alone, almost 330,000 cases of violence against women were registered in 2015, equal to a reported crime every two minutes.

Violence against women does not stay within communities and homes; it also happens within businesses. Recent reports show that sexual harassment against women workers, including different forms of verbal and physical abuse, is common in the garment industry in India. Not only does this affect women, it also holds back the Indian economy and businesses. According to the Asia-Pacific Economic Corporation (APEC) Healthy Women, Healthy Economies initiative, workplace sexual harassment programs and policies can increase female workers’ productivity, resulting in gains of up to US$186 million in developed APEC economies and US$57 million in developing APEC economies.

Addressing violence against women will require everyone to take action. BSR recently launched HERrespect—an evidence-based workplace program that builds the capacity of management and workers to challenge social norms and identify, prevent, and address violence—in India. HERrespect represents an important stepping stone toward transforming gender norms in an industry that directly employs 8 millon workers. Support from global brands and donors has been fundamental for getting the movement started, however, strategic partnerships with local business and industry associations are essential to achieve a systemic-level shift to end violence against women in the garment industry.

The government of India has called on Indian business to take action by adopting the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act in 2013. The act makes it mandatory for all companies with 10 or more employees to set up an internal complaints committee and improve employee awareness about what constitutes sexual harassment at work. Research shows, however, that almost half of the Indian companies surveyed have yet to train employees and committee members on topics related to sexual harassment at work.

We are proud to announce a new collaboration with the Confederation of Indian Industry’s Centre of Excellence for Sustainable Development (CII-ITC CESD). The aim of the collaboration is to mobilize commitment from Indian business leaders to ensure a safe working environment for female workers in the garment industry. As an industry-led business association with a wide membership across the textile and apparel sector, CII-ITC CESD plays a unique role in engaging with textile and apparel factories to strengthen the role of business leadership in preventing violence against women.

In recent conversations with garment factory managers in Tamil Nadu, we found that local business leaders need practical resources on how to ensure a safe work environment for women. In response to this need, BSR has developed “Women’s Safety in the Workplace,” a HERproject toolkit supporting managers in the garment industry to take action against sexual harassment in the workplace. The toolkit, which we developed in collaboration with CII-ITC CESD and with support from C&A Foundation, includes ready-to-use training materials and step-by-step guides on how to strengthen workplace systems to prevent and address sexual harassment.

Over the next months, BSR and CII-ITC CESD will co-host a series of events across India for business leaders in the garment industry to discuss how to address sexual harassment in the workplace.

We invite you to join the initiative and partner with us to scale HERrespect in India and beyond. Take action today by sharing the toolkit with suppliers in India and support them to promote a safe working environment for women in the supply chain.

Blog | Tuesday June 27, 2017

Supply Chain Sustainability in the Consumer Goods Industry and the Benefits of Collaboration

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When it comes to building sustainable supply chains, collaboration is critical. It helps companies share best practices and resources and jointly develop principles and standards that amplify impacts. In fact, when BSR set out our Supply Chain Leadership Ladder framework earlier this year, we established collaboration as one of the four dimensions of a robust sustainable supply chain program.

Collaboration is also a core theme of a new AIM-PROGRESS study that BSR led to examine how much progress the fast-moving consumer goods industry is making on supply chain sustainability. The annual study, which BSR has supported for the past two years, is based on information and data submitted by 40 companies representing more than US$800 billion in revenue.

In addition to providing a snapshot of the state of supply chain sustainability in the consumer goods industry, the study also shows how collaboration can drive efficiencies, encourage companies to innovate and act with ambition, and deliver greater impacts in the world. Here are five key findings from the 2016 AIM-PROGRESS Member Benchmarking report:

• Collaboration is generating cost savings: In 2016, AIM-PROGRESS members accepted nearly 2,000 supplier audits commissioned by another member rather than asking suppliers to submit to another audit. In addition to addressing audit fatigue and reducing administrative burdens, this saved members an estimated US$5 million in avoided audit costs.
• Collaboration helps companies implement the international sustainability agenda: When the UK Modern Slavery Act was passed in 2015, one-third of AIM-PROGRESS members had no formal approach to address the risks of modern slavery in the supply chain. AIM-PROGRESS set modern slavery as a priority area for the group, and today, 92 percent of members have an established approach to this issue. 
• Supply chain sustainability goals are now mainstream: Today, 90 percent of AIM-PROGRESS members have set supply chain sustainability goals—an 18 percent increase since 2015.
• Supply chain sustainability actions are reaching a larger number of suppliers: In 2016, companies engaged about 50 percent of in-scope suppliers through a sustainability assessment, audit, or self-assessment—up from 33 percent of in-scope suppliers in 2015.
• Companies are investing in more robust governance and management: In 2016, companies reported a 60 percent increase in the number of people working on responsible sourcing, and a 14 percent increase in program oversight at the vice president level or above.

This survey reveals that company efforts on supply chain sustainability are maturing, as is the collaboration architecture that supports them. Members of AIM-PROGRESS said the collaboration has helped to strengthen their responsible sourcing programs. “We have benefitted substantially from learning from other companies and sharing resources as we have ramped up our program. We use the [survey] insights as a tool to engage our teams and drive further progress,” said Anheuser-Busch InBev Sustainability Manager Clare Flannery. WestRock Director of Supply Chain Compliance and Sustainability Christopher Campolongo added that this kind of work gives AIM-PROGRESS members “greater visibility into common topics that can be improved on a global scale.”

As we mark our 25th year, BSR will build on what we have learned to help our members get the most out of collaboration on supply chain sustainability. Whether through our own Collaborative Initiatives or via partnerships with other platforms, we will continue to champion collaboration as a way to build inclusive, resilient, and transparent supply chains.