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Blog | Monday August 30, 2021

Sustainable from the Start: Embedding ESG into High-Growth Business Strategy

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We are experiencing a profound shift in stakeholder expectations and business growth strategy: sustainability is more important than ever before. Younger, high-growth companies—those that either are privately held or recently went public—face unique challenges and opportunities as they expand business while also considering environmental, social, and governance (ESG) factors, be it climate change, privacy, diversity, or a range of other material issues. 

Over the past two years, we have hosted quarterly convenings for high-growth companies to share challenges and approaches on a variety of ESG topics. In these meetings, BSR spoke with company sustainability leaders, who shared how their experiences might apply to younger businesses. Based on the outcomes of these discussions, what are the main considerations for a high-growth company at the start of its ESG journey?

First Up: Identify Material ESG Issues

Conducting a materiality assessment is an essential “do this first” step to jump-starting an ESG strategy. A materiality assessment is a widely used approach to help companies develop ESG priorities by understanding the most important topics. It identifies key areas of overlap between enterprise value creation (“impact inwards”) and impact on society and the environment (“impact outwards”).

Materiality can help a young company: 1) align on relative priorities and clarify the rationale; 2) enable better allocation of resources to address priority issues; and 3) communicate more effectively, internally and externally, on the most material issues. 

We explore other key steps in a recent report published in collaboration with Morgan Stanley, which addresses why, when, and how high-growth companies can develop ESG strategies that support value generation and meet growing stakeholder (i.e. investor) expectations. 

So, you’ve taken the initial recommended steps. What do you need to consider first among the ESG dynamics at play?

Environmental Issues

Acting on the climate crisis is more urgent than ever, no matter where a high-growth company is in their sustainability journey. While younger companies may have a smaller environmental impact than more established ones, they must not ignore issues such as climate change and energy use because extreme, systemic climate risks can be disruptive to the global economy and all businesses.

To develop a climate strategy that fits a company’s business model, scale, and stakeholder expectations, start by measuring the company’s greenhouse gas emissions footprint, which will provide a baseline to make informed decisions, commitments, investments, and operational changes moving forward. Once the company understands its footprint, it can then create a strategy to meet an ambitious climate action commitment, as exemplified by Atlassian’s Science-Based Target and net-zero goal and Okta's 100-percent renewable energy commitment.

Social Issues

The COVID-19 pandemic, ongoing social justice movements, and recent social media deplatforming events have put a spotlight on how companies need to address the “S” in corporate ESG issues—and younger companies whose workforces are rapidly growing cannot wait to act.

While studies continue to show that diverse and inclusive teams provide many business benefits, companies big and small still struggle with creating a workforce where employees enjoy equitable opportunities in a welcoming environment. BSR recommends that high-growth companies adopt equitable and inclusive practices early on, such as ensuring job descriptions don’t include gender-biased language and working with a third party to conduct an annual study to ensure pay equity. We also encourage companies to promote social justice by leading with equity. 

Additionally, collaborative efforts with partners like the Tech Equity Collaborative, Alliance for Global Inclusion, and Partnership for Global LGBTI Equality are great ways for younger companies with smaller teams to work with others to help improve DEI practices and realize benefits at the company and industry-wide level.

Governance Issues

High-growth companies develop with such speed and scale that they often lack strategic approaches and governance structures for managing various ESG issues and are often not resourced with dedicated ESG staff. In turn, the management and communication of ESG efforts can be often an overwhelming task, leaving employees looking around and asking, “who’s responsible for what, and how does any of this get done?”

In establishing an ESG governance structure, first look at team members. Senior leadership support for and awareness of the business case for addressing material ESG issues is critical to gaining resources and realizing the benefits of action over time. Regardless of whether a dedicated Head of ESG position is an option or not, a cross-functional approach—in which senior leadership engages with various business units, be it human resources, investor relations, legal, sales, or product engineering—helps to ensure shared ownership and management of ESG issues that are often interconnected.  

When it comes to communications, start with a featured section of the company website that transparently shares where the company is in its ESG journey. Then consider more robust reporting frameworks, such as the Global Reporting Initiative and the Value Reporting Foundation, to identify indicators to use when reporting annual progress on the company’s material ESG issues.

It is never too early (or too late) to embed ESG into a high-growth business model. Embracing ESG practices early has shown to improve valuation and ultimately long-term success. BSR continues to run our high growth webinar series both in the US and EMEA—if you want to participate, don’t hesitate to reach out.

Blog | Thursday August 12, 2021

China’s 14th Five-Year Plan: Broad Insights for the Healthcare and Pharmaceutical Industries

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2021 is witnessing the beginning of China’s 14th Five-Year Plan (14th FYP), which charts the next five years of China’s journey to build a modern socialist country and achieve its second centennial goals. It provides a comprehensive framework for how the country’s society and economy will develop by 2026 and includes the strategy to build a “Healthy China,” which aims to improve overall social conditions, including healthcare.

As a country with a population of 1.4 billion, China faces many health challenges. These include high medical care costs and resource disparity between urban and rural areas, resulting in poverty due to illness, especially in rural areas (approximately 20 million people faced disease-causing poverty as of 2015). Other challenges include an increasingly aging population and rising rates of noncommunicable diseases (NCDs) linked to lifestyle factors like smoking.

So how does China’s 14th FYP impact the healthcare and pharmaceutical industries? Here are three ways these companies can help advance the “Healthy China” strategy.

1. Improving Affordability of Healthcare Services

Primary healthcare reform in China over the past decade has included extensive plans to broaden basic healthcare coverage and establish a national essential drug system. While “Healthy China” aims to improve overall health through healthy lifestyles and prevention approaches, there is an opportunity to enhance medical coverage for the entire population through better integrated rural and urban health insurance programs, to expand insurance schemes to allow more diversified commercial health insurance options, and to further cut down medical costs for patients.

Developments and reform in medical insurance, as well as drug pricing, will indisputably exert pricing pressure for pharmaceutical companies in China. However, experts believe that the policies will trigger convergence toward a developed-market profile for mature brands and will prompt multinationals to reevaluate their returns on investment and to transform business models to improve productivity and sustain profitability.

Moreover, there are enormous opportunities for pharmaceutical and insurance companies to collaborate on creative approaches to improve access to healthcare. For example, in 2015, Roche China started a partnership with the Shenzhen Reimbursement Authority and the leading Chinese insurance company Ping An to cover four of Roche’s targeted cancer therapies in the municipality’s health insurance program, which gave millions of people unprecedented access to innovative cancer treatments and diagnostics.

2. Strengthening Accessibility in Healthcare

The 14th FYP also covers recommendations to deepen reform of public hospitals and to provide equal access to basic public healthcare services, such as digital primary care, remote medical treatment, and rehabilitation services for seniors. The recommendations also support development of traditional Chinese medicine (TCM), which is significantly more accessible and affordable in China.

As China plans to significantly promote digitalization in healthcare, there is huge potential for the private sector to play a role in accelerating delivery of Internet-based healthcare services through artificial intelligence, machine learning for diagnostics and treatment, and augmented-reality surgeon training. Already, some Chinese companies are piloting related initiatives, such as Pingan Good Doctor, Tencent WeDoctor, AliHealth, and JDHealth.

We encourage companies to expedite the move online by deepening their understanding of new user behavior and providing support. Digitalization is becoming essential for customer and patient engagement: According to a Bain survey, 97 percent of Chinese respondents expressed interest in digital health services if the costs were covered by an insurance provider or employer, and 64 percent expected to use telemedicine within the next five years.

Companies could also play a role in supporting local governments to achieve their public health and environmental goals related to medical waste and supply chain management. Specifically, Shanghai aims to become one of the safest cities for public health by 2025, opening up opportunities to participate in a range of initiatives covering infrastructure, operational efficiencies, and new capabilities, all with the goal of building an intelligent platform for public health.  

3. Enhancing Cultural Focus on Well-Being

According to officials, objectives in the 14th FYP, compared to previous Plans, have shifted to have a greater focus on public health promotion and prevention, rather than on treatment. The healthcare and life sciences industries are promoting early warning and prevention of infectious diseases and NCDs, vaccine research and development, online medical services, and, perhaps most importantly, patient awareness raising that emphasizes healthy lifestyles and physical fitness.

Most multinational pharmaceutical companies already place emphasis on enhancing acceptability or delivery of healthcare and have piloted various sustainability and community programs in China dedicated to patient education and raising awareness—and more companies can follow suit.

Moreover, the preventive healthcare strategy calls for more innovative efforts to support public health awareness, which are cost-effective and ultimately improve overall health and quality of life. In this regard, companies have the opportunity to engage more in public education and facilitate effective patient engagement programs by building these activities into their sustainability strategies.

Learning from COVID-19

The fight against COVID-19 shows both weakness and resilience in China's healthcare system, as well as its ability to mobilize resources in both communities and in the private sector. 

Post-pandemic, we can expect greater attention on public health, prevention, and development of primary care at the central government level. At local levels, leaders will likely pay even more attention to healthcare as a leading indicator of their performance and draft ambitious blueprints for their local healthcare systems. Business and local communities can participate and play an active role in promoting a healthy life—BSR’s HERhealth program illustrates that businesses can support workers to improve their health awareness, achieving a positive impact in the workplace.

While the “Healthy China” strategy creates many possibilities for the healthcare sector, we can anticipate that wider healthcare coverage in China—as well as increasing local needs for healthcare services that are more accessible, affordable, and acceptable—might stimulate continuous ramp-up of local manufacturing and production.  

Supply chain management with a particular focus on environmental practices, such as proper water management and wastewater treatment, will need extra attention to ensure manufacturing practices are aligned with China’s national climate and environmental protection targets. Companies will also need to ensure proper control of medical waste and manage social protection—especially workers’ benefits—well.

What’s Next

BSR’s China team will continue to unpack business impacts of the national plan. Future blog posts will provide more details on industry impacts and how businesses should prepare through insights and dialogues with climate and energy experts and other important stakeholders across sectors. 

If you are interested in learning more about how BSR can help shape your China strategy, please reach out.

This blog is part of a series examining the business impacts of China’s 14th FYP, which has drawn great interest among the international community, from policymakers to business. To learn more, read our previous posts on what business can expect, China’s climate goals, and impacts for investors.

Blog | Tuesday August 10, 2021

The Urgency of Private-Sector Action on Gender-Based Violence

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Gender equality can only be achieved when women and girls live free of violence. And as of now, they do not.

Violence against women remains a globally pervasive human rights violation. One in three women worldwide will experience physical and/or sexual violence at the hands of men at some point in their lives. Women experience violence in homes, public places, and the workplace, including factory environments in global supply chains. In India and Bangladesh, for example, around 60 percent of garment workers have experienced sexual harassment in the workplace.

The COVID-19 pandemic has exacerbated these high levels of violence, with lockdowns trapping women in violent relationships. What’s more, women have also lost their jobs and livelihoods at a far higher rate than men.

An effective response to this crisis means widespread change in social norms to prevent it from happening in the first place. Public and civil society efforts and investments are not enough—the private sector must play its part.

In June 2021, BSR, in partnership with the Sexual Violence Research Initiative (SVRI) and global mining company Anglo American, hosted a panel at the Generation Equality Forum on how the private sector can prevent and address gender-based violence. Here are our key takeaways.

The Critical Role of the Private Sector

While governments invest heavily in vital response programs—such as providing critical services like health care, psychosocial support, shelters, and medico-legal services—the private sector can use its reach and influence to focus on prevention.

Prevention programs intervene early. They can include parenting interventions that address violence against both women and girls, school-based programs that address gender equality and violence, and those that aim to shift community-based social norms.

The private sector also has considerable power to change mindsets through large-scale communications campaigns, educating audiences about these prevention programs, why they are important, and the impact they create.

Case Studies in Successful Gender-Based Violence Prevention

Gender-based violence is still a pervasive issue, but several programs demonstrate that, through concerted action, significant progress is possible.

Global mining company Anglo American’s Living with Dignity initiative aims to confront gender-based violence in its host communities and operations and focuses on internal advocacy, evidence-surfacing, and strategic partnerships. It can serve as a best practice example for companies looking to implement similar programs.

Living with Dignity has produced wide-ranging changes in Anglo American’s South African workplaces, which are underpinned by vocal commitment and model behavior from leadership teams. For example, leaders across the business have received coaching on gender-based violence and harassment. And sexual harassment is seeing an increased prominence in meetings across the business and features regularly on leadership calls and town hall agendas.

Cross-sector collaborations also can help take solutions to scale. BSR’s HERrespect program, a HERproject initiative, seeks to encourage gender-equitable attitudes and relationships between women and men in global supply chain workplaces. And its impact has been palpable.

Throughout implementation of the program, HERrespect has driven lower acceptance of violence against women, increased awareness on what constitutes sexual harassment, less acceptance of gender-unequal statements, a greater sense of empowerment in stopping violence, and more awareness on internal support mechanisms for affected women.

For example, at the start of the program, 34 percent of participants believed that there are times a woman deserves to be beaten. At the end, only 15 percent agreed.

Our experience has shown us that gender-based violence is preventable. But to successfully achieve that, a multi-stakeholder approach is necessary—one that includes community-based organizations, researchers, consumers, donors, and, indeed, the private sector.

The socioeconomic impact of COVID-19 on the lives of women has created a sense of urgency for the private sector to mobilize and act. Whether it’s responding to the needs of workers in the workplace or partnering with organizations that conduct research and implement community-based programs, the opportunity for companies to address and prevent gender-based violence is massive. To learn about how your company can get involved in this work and hear from the experiences of this group, reach out to HERproject, SVRI, or Anglo American.

Reports | Monday August 9, 2021

Addressing Forced Labor and other Modern Slavery Risks: A Toolkit for Corporate Suppliers

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Businesses operating in global supply chains are more likely to encounter situations of forced labor or other forms of modern slavery than their multinational counterparts, yet many lack simple guidance on how to identify, prevent, and manage these risks effectively.

To address this gap, this toolkit from the Global Business Coalition against Human Trafficking (GBCAT) aims to help businesses that work in corporate supply chains to quickly identify areas of the business which carry the highest risk of modern slavery and develop a plan to identify, prevent, and address risks. While the toolkit is designed particularly for small- and medium-sized enterprises, it can help businesses of all sizes who are new to understanding modern slavery risks.

GBCAT has also released a one-page infographic highlighting practices to avoid the use of forced labor and has compiled a list of resources for suppliers for additional guidance on its supplier portal.

Blog | Tuesday July 27, 2021

Reflections on a Sunset: Lessons Learned from the Global Impact Sourcing Coalition

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It has been seven months since we sunsetted the Global Impact Sourcing Coalition (GISC), and I’m still troubled by the question: “Did we fail?” 

If we measure our progress against our ambitions, the answer is “yes.”  

But I’m also compelled to make the case for “no.” While it didn’t live up to its full potential, we did something extraordinary. Our effort was valuable for those who participated and positively impacted thousands of employees’ lives around the world. The experience is worth learning from.

The GISC officially launched in 2016 with the aim of building more inclusive supply chains through Impact Sourcing—a business practice where companies prioritize suppliers that intentionally hire and provide career development opportunities to people who otherwise have limited prospects for formal employment.

We began with 20 members, and by the end of 2020, we had the support of over 75 companies and stakeholder organizations hailing from 32 countries. But ultimately, at the end of last year, BSR and the GISC Steering Committee made the responsible decision to disband the GISC, releasing the resources and energy we had centralized back into the universe to support new opportunities.

At BSR, we believe that collaborations go further and deeper when they are designed for impact and that the practice of multistakeholder collaboration is very much a work in progress. In our efforts to continuously improve, we are sharing a Lessons Learned report that seeks to capture both the successes and missteps that we encountered while running the GISC—so that other collective action efforts can build on our experience. 

What Worked Well

GISC’s premise was simple: By prioritizing suppliers that have established inclusive employment initiatives, GISC members could send a powerful market signal to all corporate suppliers—which employ a fifth of the global workforce—encouraging them to compete based on their social impact. Inspired by the supplier diversity movement, we held the ambition for all large companies to pledge a percentage of their procurement spend toward suppliers that intentionally offer good, career-advancing jobs to people who formerly lived in poverty.

To our delight, this market-driven approach began to work. Many supplier companies launched or expanded their inclusive employment programs to better distinguish themselves to their clients. They also began to update their policies and practices in accordance with the requirements of the GISC’s Impact Sourcing Standard and, as a result, created more inclusive workplaces and good jobs for all employees.

Due to the commitments of companies like GISC’s supplier members to hiring the most vulnerable in their communities, the business process outsourcing (BPO) industry is both expanding its talent pool and more evenly distributing gains across entire communities.

Our most visible success resulted from a multi-year Impact Sourcing Challenge that led GISC suppliers to pledge and then meet their goal to employ over 29,000 impact workers in good jobs from 19 countries around the world. This included people on the autism spectrum in the United States, long-term unemployed youth in South Africa, and people who formerly lived in poverty in India and the Philippines. Furthermore, suppliers reported to the GISC many additional business benefits that companies often report experiencing with more inclusive and diverse cultures, such as decreased turnover and a more highly motivated workforce, further reinforcing their commitment to inclusive employment.

What We Could Have Done Better

At the same time that we were seeing these advancements, cracks in our business model began to appear, and they only deepened as the GISC grew.

Among other important lessons, we should have worked to secure, from an early stage, multiple funding partners who shared the GISC’s vision for market-driven poverty alleviation across supply chains and who could provide strategic injections of philanthropic and patient capital to support this long-term vision.

We found that a business model built entirely around membership dues was weighted by the requirement to deliver member benefits, making it more difficult to engage in forward investment and the creation of public goods. To continue our progress, we would have needed to invest in in-depth measurement and evaluation, rightsholder engagement and consultation, due diligence, advocacy to reach new audiences, and to build up an emergency fund to better react to unexpected circumstances.

And because of these missteps, just as we had the evidence that our theory of change was robust and it was time to hit the accelerator to reach scale, we ran out of the funds necessary to do so.

Through the GISC, we managed to rally a wave of professional and personal energy whose ripples continue to spread around the world in new and exciting ways. We are proud to note that, beyond GISC’s tenure, many former member companies, industry networks, and other stakeholders have stepped up to continue to champion the Impact Sourcing movement, utilizing their influence, communications, and networks to inspire more companies. Several GISC members have gone on to launch Impact Sourcing chapters and working groups, taking collaborative efforts forward in key geographies such as North America, India, and South Africa.

We hope that, in reading the Lessons Learned report, you see that we were able to go further through collective action than any one organization could have alone and that there are many metrics beyond a collaboration’s continuation that might better define impact and success.

BSR continues to support companies in developing their Impact Sourcing strategies, so please contact us to learn more. And be sure to join the Impact Sourcing Champions LinkedIn group to connect with like-minded professionals.

Reports | Tuesday July 27, 2021

Lessons Learned from a Market-Based Approach to Inclusive Employment

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BSR developed this report with the support of The Rockefeller Foundation to capture lessons learned from the launch, implementation, and sunset of the Global Impact Sourcing Coalition (GISC). We aim, through this report, to help current and future collaborative initiatives to benefit from our learnings, progress, and missed opportunities. We also seek to inform philanthropic foundations and other donors of the opportunity to support high-impact, private sector-led partnerships for sustainable development.  

The report provides an overview of the Impact Sourcing movement and the GISC, followed by an analysis of the GISC partnership against five key success factors for high impact collaborations, highlighting both successes and missed opportunities. It concludes with recommendations for the Impact Sourcing movement, future collaborations, and donors and other contributors to collaborative initiatives for sustainable development. 

Blog | Thursday July 22, 2021

Dynamic Materiality: How Companies Can Future-Proof Materiality Assessments

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This is the second in a four-part blog series dedicated to enhancing the value of materiality assessments. In the first blog, we discussed why companies should assess double materiality. Here, we explore how companies can monitor dynamic materiality.

If you conducted a materiality assessment in 2019 and are wondering if you need to refresh your assessment in light of 2020’s extraordinary events, raise your hand!

Indeed, we can expect the materiality of environmental, social, and governance (ESG) impacts to change over time for many different reasons: stakeholder activism, new regulations, or a global pandemic, to name just a few.  

The concept of “dynamic materiality” was first introduced by the World Economic Forum (WEF) in early 2020 and is gaining traction. Now, the five reporting standards—CDP, Climate Disclosure Standards Board (CDSB), the Global Reporting Initiative (GRI), the International Integrated Reporting Council (IIRC), and the Sustainability Accounting Standards Board (SASB)—affirm that materiality should be considered dynamic and that sustainability topics can become financially material over time. Not only that, but according to WEF, “the ability to anticipate stakeholder reactions to emerging sustainability issues and how they could affect a business and its performance is therefore critical.”

Here is how it works in theory: Businesses may take actions that negatively impact society, either through their products or their operations. Initially, the interests of companies and society are misaligned, but society tolerates this. For example, although pharmaceutical contamination of the environment has been known for years to negatively impact water supplies and human health, “companies have not yet been held responsible for this externality.”

Then a catalyst—either a change in company behavior or in societal norms—widens this misalignment. After this, stakeholder activism, regulatory responses, and corporate innovation may all push the issue from immaterial to material, whether for a single company or the whole industry.

Looking back at the concept of double materiality, impacts outward become impacts inward. Take the #MeToo movement that shed light on harassment in the workplace: Through increasing public awareness, workplace harassment rapidly became a material issue for companies like Alphabet that had to settle shareholder lawsuits related to sexual misconduct scandals. 

However, while WEF’s “framework for action” notes that increasing evidence and transparency, escalating stakeholder activism, growing responsiveness of key decision-makers, and expanding investor emphasis on ESG are all driving increased dynamism in the materiality of ESG issues, they and other reporting experts offer little guidance in discerning which ESG issues might become material in the future.

A Scenario-Driven Approach to Dynamic Materiality

Given the myriad of uncertainties about the macro environment shaping societal expectations—whether political shifts, technological innovations, or environmental changes—BSR takes a scenario-driven approach to dynamic materiality.

This entails stress-testing a materiality assessment against a set of plausible scenarios for the future to ascertain which ESG issues are likely to become more material over time, which currently immaterial issues may become material, and which ones are highly volatile—that is, highly sensitive to unpredictable shifts in the operating context.

Taking this foresight-driven approach is useful for several reasons:

• It transforms a materiality assessment from a static reporting exercise into an opportunity for strategic foresight. Internal stakeholders consider more deeply how the macro environment is driving stakeholder concerns and what drivers could reshape them in the future.
• It helps firms develop more resilient business strategies that anticipate different versions of the future and hedge against critical uncertainties. This ensures that strategy is developed looking at the road ahead rather than in the rearview mirror.
• It bolsters reporting—helping external stakeholders better understand how the company’s "materiality signature" may change over time and offering assurance that proactive steps are being taken to prepare.

Brendan Seale, former director of corporate sustainability at Scotiabank, recently spearheaded a project with BSR in which we used scenarios to stress-test materiality for his company. He said:

“As we began our materiality assessment in the fall of 2020—in the throes of the pandemic and the swelling consciousness of systemic injustice—it was obvious that many issues had become more important for Scotiabank than they were six or twelve months earlier. We wanted to explore potential changes to materiality over time, and future scenarios helped us to consider how our ESG strategy can be resilient and evolve in our rapidly changing world.”

No business can perfectly predict the future. But applying strategic foresight to materiality will improve outcomes for businesses and stakeholders alike.

To get involved in this work, contact the Sustainable Futures Lab.

Blog | Tuesday July 20, 2021

A Human Rights Assessment of the Global Internet Forum to Counter Terrorism (GIFCT)

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The Global Internet Forum to Counter Terrorism (GIFCT)—a multi-stakeholder effort founded by Facebook, Microsoft, Twitter, and YouTube—launched in 2017 with a mission to prevent terrorists and violent extremists from exploiting digital platforms.

In late 2020, GIFCT commissioned BSR to undertake a human rights assessment of its strategy, governance, and actions. Today, we are publishing the final report.

Our assessment used a methodology based on the UN Guiding Principles on Business and Human Rights (UNGPs). Given the role of governments in GIFCT, we considered the first pillar of the UNGPs (the state duty to protect human rights), as well as the second and third pillars (the corporate responsibility to respect and access to remedy). The scope of our assessment was GIFCT itself, not the actions of individual GIFCT member companies, and our assessment was primarily forward looking in focus rather than a review of prior activities.

GIFCT is a young and newly independent organization that appointed its first executive director in mid-2020. In that context, we appreciate GIFCT’s foresight for undertaking a human rights assessment at such an early stage in its evolution, and we trust that our assessment provides a framework for the integration of human rights into the strategy, governance, and actions of GIFCT over the coming years.

The full assessment is organized around nine themes, makes 47 recommendations for GIFCT, and is intended to provide useful insights for the counterterrorism field overall. Here, we emphasize five key points:

• GIFCT mission and goals: The purpose of GIFCT is to prevent terrorists and violent extremists from exploiting digital platforms, and in doing so, GIFCT enhances the protection, fulfillment, and realization of human rights—in other words, human rights for GIFCT should be about more than “avoiding harm” while pursuing its mission. GIFCT would benefit from a clearer description of the interdependent relationship between human rights and its mission that conveys human rights as a deeply embedded, complementary, and reinforcing objective in counterterrorism and violent extremism efforts.
• Terrorist and violent extremist content: The lack of consensus around definitions of terrorist and violent extremist content, and the prevalence of bias in the counterterrorism field—manifested in a disproportionate focus on Islamist extremist content—influence GIFCT’s human rights impacts. The multi-stakeholder status of GIFCT provides an opportunity to create a common understanding of terrorist and violent extremist content based on “behavior” rather than “group.” We recommended that GIFCT explore the potential benefits of this common understanding, such as pushing back against overbroad definitions deployed by governments, improving the capability of smaller companies to establish their own definitions, and creating a bulwark against “slippery slope” definitions that may extend too far into other forms of speech.
• GIFCT membership: We encountered considerable debate around whether GIFCT should increase its company membership, especially with companies headquartered outside the U.S. Given the UNGPs' emphasis on prioritizing the most severe human rights impacts, we recommended that a human rights-based approach should focus on the locations where impacts are most severe rather than where they have the highest profile. By making a proactive effort to engage more with companies and organizations outside the U.S. and Europe, GIFCT will be better positioned to achieve its mission through more engagement with companies and organizations outside the U.S. and Europe. However, expanding GIFCT membership also presents human rights risks, and we make several recommendations for GIFCT membership criteria, such as a public commitment to the International Bill of Human Rights and the UNGPs.
• Stakeholder engagement: GIFCT contains some features of a multi-stakeholder initiative (i.e. non-companies actively participate in the work of GIFCT) but lacks others (i.e. decision-making power rests solely with companies). However, stakeholder engagement plays a central role in a human rights-based approach, so we recommended that GIFCT’s work would benefit from a more deliberate integration of affected stakeholders into its work, including by broadening the range of groups engaged and clarifying the role of governments in GIFCT. GIFCT would also be strengthened by increasing its interaction with the UN Special Procedures system, the Office of the High Commissioner for Human Rights, and the UN Office of Counter-Terrorism.
• Governance, accountability, and transparency: We conclude that GIFCT’s Operating Board, which currently consists of four founding member companies, is not a sustainable model over the medium and long term and recommend that GIFCT consider the merits of transitioning to a multi-stakeholder decision-making model two years from now. We also made several recommendations to clarify, strengthen, and formalize the role of GIFCT’s Independent Advisory Committee (IAC). Given GIFCT’s connection to human rights impacts exists primarily through the actions of member companies, we placed special emphasis on the transparency requirements of GIFCT member companies, in addition to GIFCT itself.

BSR’s assessment makes recommendations in several other important areas, such as restrictions, controls, and oversight mechanisms to address the risk of overbroad removal of content by companies making use of GIFCT resources and developing a GIFCT point of view on what policies, actions, and strategies governments should deploy that would address the exploitation of digital platforms by terrorists and violent extremists in a rights-respecting manner.

The UNGPs emphasize the importance of ongoing human rights due diligence rather than a single “moment in time” assessment. In this spirit, we hope that our assessment increases the “connective tissue” across different segments of GIFCT’s work—such as the Operating Board, IAC, and working groups—and provides a foundation upon which GIFCT can grow.

Reports | Tuesday July 20, 2021

Human Rights Impact Assessment: Global Internet Forum to Counter Terrorism

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The Global Internet Forum to Counter Terrorism (GIFCT) commissioned BSR to conduct a human rights assessment of its strategy, governance, and activities. The purpose of this assessment is to identify actual and potential human rights impacts (including both risks and opportunities) arising from GIFCT’s work and make recommendations for how GIFCT and its participants can address these impacts. BSR undertook this human rights review from December 2020 to May 2021.

This assessment combines human rights assessment methodology based on the UN Guiding Principles on Business and Human Rights (UNGPs) with consideration of the human rights principles, standards, and methodologies upon which the UNGPs were built. This review was funded by GIFCT, though BSR retained editorial control over its contents. 

Reports | Thursday July 15, 2021

Responsible Product Use in the SaaS Sector

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According to many ethical and human rights frameworks, software-as-a-service (SaaS) companies have a responsibility to address adverse impacts that may be associated with their business relationships and use of their products and services.  

This paper explores how SaaS companies should develop, implement, and promote ethical use practices, encompassing acceptable use policies and service terms, best practices for customer gating, transparency measures, reporting channels, and training for customers, employees, and users. It also proposes four foundational elements to help move the field forward.