Image: Silk rolls
February 2024
The Outcome Gap hosted a Side Session webinar at the 2024 OECD Forum on Due DIligence in the Garments and Footwear sector. This blog gives a summary of our key takeaways. You can also watch the webinar recording below.
Context
It's Friday 23rd February 2024, and the long awaited EU Corporate Sustainability Due Diligence Directive (CSDDD) hangs in the balance. For how long we don't know (*just 6 days later, this is looking bleak!), but the progress made on the requirements of the directive suggest a shift towards "impact thinking". What do we mean by that? The ESRS datapoints developed (see here) by EFRAG require things like:
Accuracy of metrics
Intended outcomes in lives of value chain workers
Effectiveness of engagement with value chain workers
Contributions to additional material positive impacts, and
Aims for continued improvement.
Regardless of whether the CSDDD is eventually passed, we are seeing a shift towards double materiality which will be a step change for companies used to identifying "risk to business" and closing that risk, towards identifying "risk to people" and committing to longer term improvements in conditions.
With this in mind, we asked our panelists:
What is social impact, in the context of human rights due diligence?
What does that mean for worker engagement?
How can "impact data" be used?
Here's where we got to.
Key takeaways
Social impact in the context of HRDD is how workers in global supply chains say they are impacted, not how we think they are impacted or should be impacted.
Their reality may not fit into questionnaires set from afar, which may miss the key points about their realities. We need also to consider that different categories of workers will have different needs and explanations of their situation – and we should frame our engagement with them accordingly.
We need to shift our thinking away from collecting data from workers for brands to use, towards enabling workers to use their own data to good effect locally and directly with their employers.
We heard examples about how worker organisations are supporting such efforts, including from Bluenumber and their MillionMakers initiative, CNV Internationaal’s support to advocacy on minimum wage negotiations in Cambodia and TURC’s advocacy in Indonesia during the pandemic.
Access to fundamental rights including the right to freedom of association and collective bargaining is a key enabler of improved conditions and social impact.
Supporting access to fundamental rights should remain a key focus for companies in the apparel and footwear sector, in countries where industrial relations are conflictual. Many existing metrics around these rights don’t capture the quality of social dialogue which is key to whether workers are able to negotiate for better conditions themselves. Brands need to keep this issue on the agenda and really investigate progress.
Alongside their role in organising workers, identifying needs and supporting advocacy efforts directly with employers, trade unions can also support brands on how to engage in the HRDD process. See this report by CNV Internationaal for guidance.
Worker-led information about their prevailing conditions gives context to social audit data and fills an evidence gap.
Social audit data is often the one source of information that most brands have about human rights conditions on a site, but there are recognised limitations in the credibility of this approach and its ability to identify challenging human rights issues. Further it is only ever a snapshot in time. In a world moving towards double materiality, social audit data identifies risk to business but does not serve to identify risks of the business to people.
Brands need to move away from a reliance on broad, quantitative data towards getting depth and nuance on priority topics or where conditions are likely to be poor, through mixed methods analysis.
Many corporate decision-makers in brands maintain a reliance on hard metrics and quantitative data – but this can be one-sided as they don’t tell the full story of the risk a business has to people. A mixed methods approach is more balanced: this report by Primark illustrates how such analysis can be achieved. The report also demonstrates the importance of independent impact evaluations, important for external validity as well as external insights and learning.
Huge thanks to our panelists for their contributions:
Puvan Selvanathan, Founder of Bluenumber
Isabelle de Lijser, Regional Coordinator Asia, CNV Internationaal
Didit Saleh, Deputy Director, Trade Union Rights Center
Vishal Gadhavi, Social Impact Measurement Manager, Primark
You can watch the video here:
How we're supporting human rights due diligence efforts
You can read more about What We Do at the link below.