Human Rights Due Diligence & Value Chain Transparency

In the ESG context, human rights due diligence and value chain transparency are closely interconnected elements under the social pillar. The former is the process by which companies proactively identify, assess, and address potential human rights risks across their operations and supply chains. To do this effectively, they must first achieve value chain transparency – gaining clear visibility into who their suppliers are, how goods are produced, and under what labor conditions. Without transparency, human rights due diligence becomes superficial or reactive.

Human Rights Due Diligence

Human rights due diligence is the process by which companies proactively identify, assess, and address potential human rights risks across their operations and supply chains. This includes risks like forced labor, unsafe working conditions, or discrimination especially in global supply chains.

Its key features and potential collaboration areas include:

  • Cross-departmental approach to human rights due diligence
  • Board-level responsibility for identifying, owning, managing, and mitigating human rights risks
  • Processes to identify and address negative human rights impacts in operations and value chains
  • Integration with environmental due diligence

Value Chain Transparency

Value chain transparency refers to a company’s ability to map, monitor, and disclose the entities and practices across its supply chain. This includes knowing where raw materials come from, who the suppliers are, and how labour and environmental standards are upheld.

Its key features and potential collaboration areas include:

  • Supply chain assessment as part of material ESG factors reporting
  • Supplier assessments and impact of supply chain activities on local communities
  • Anti-corruption practices in the supply chain
  • Integration with Scope 3 emissions reporting

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Explore the following resources and initiatives relating to human rights due diligence:

  • Norton Rose Fulbright and British Institute of International and Comparative Law joint study
  • UN Human Rights Office “Human Rights Due Diligence and the Environment: A Practical Tool for Business”
  • Ethical Trading Initiative human rights due diligence framework
  • Business & Human Rights Resource Centre Singapore guidance

Explore the following resources and initiatives relating to value chain transparency:

  • Singapore Exchange suppliers’ sustainability survey
  • SGX RegCo’s 27 Core ESG Metrics including supply chain indicators
  • Enterprise Singapore’s SME Supply Chain Sustainability Toolkit
  • Global Reporting Initiative (GRI) Supply Chain Standards implementation guidance
  • Singapore Green Labelling Scheme for sustainable sourcing