Blog,
By Rosie Beacock, GBI Researcher and Analyst
Businesses are increasingly acting on climate change – including by supporting the transition out of fossil fuels and into cleaner energy. But how can companies ensure respect for human rights in this transition to cleaner energy?
Companies are implementing various low-carbon strategies, including investing in renewables or increasing commercial activities in the sector. As these efforts rapidly expand and connections between climate change and human rights become more widely recognised, businesses face greater scrutiny by - and heightened expectations from - investors, civil society and consumers.
Under the UN Guiding Principles on Business and Human Rights (UNGPs), businesses have a responsibility to address human rights impacts. This includes their potential or actual impacts from exiting high-carbon activities and from entering into renewable energy projects and supporting the transition to cleaner energy. But companies focussing on renewables have a lot of catching up to do when it comes to effective human rights due diligence processes in the value chain, while other enterprises with renewables assets may only focus due diligence efforts on business areas perceived as high risk. It is important to recognise that while renewables are integral to achieving a low-carbon future for all, they can pose risks to people as well as benefits.
Human rights risks in renewable energy
We know that there are significant risks to people across the value chains of renewables. Not only are human rights impacts associated with key minerals needed to meet the demand for cleaner energy, but also with their smelting and refining, the manufacturing of components, transport, and acquisition of land for large-scale projects. Risks reported include:
- Allegations of forced labour in the manufacture of polysilicon for solar panels
- Key habitats harmed by green energy infrastructure
- Demand for Balsa wood for wind turbines linked to impacts on Indigenous peoples’ rights
- Poor working conditions in solar installation
- An increase in harmful e-waste from disposal of renewables technologies
- Attacks against human rights defenders linked to hydroelectric projects in Latin America
- Land grabbing for wind and solar farms
- Lithium extraction impacting communities’ access to clean drinking water
Shifting to action and bridging silos
Increased action is needed to ensure effective human rights due diligence is carried out when it comes to low-carbon strategies. Earlier this year, the Global Business Initiative on Human Rights held a practical business dialogue on responding to the climate crisis while respecting human rights. The dialogue demonstrated there is growing recognition from business and stakeholders of the need for a more holistic approach to risk management across environment and human rights.
Consideration of issues like renewables which are at the intersection of climate, environment and human rights demonstrates the need to get people talking across siloed business areas and teams. There is a real impetus to do this from emerging mandatory due diligence requirements, with the EU suggested draft law connecting the obligation to conduct both environmental and human rights due diligence.
Seven Steps for Business
1. Within your company, promote internal understanding that human rights risks can be associated with renewable energy projects.
2. Identify and address any gaps in your company’s human rights due diligence processes – are you picking up risks in renewable energy activities and taking steps to address them?
3. Reflect on your KPIs for renewable energy and how human rights could be integrated into them. For example, the energy produced by a wind turbine farm considered alongside the level of engagement with local communities.
4. Initiate cross-functional discussions with colleagues in environmental or sustainability teams to reduce siloed-thinking on these issues. This could be in the form of training sessions or exploratory workshops. Work to create a shared language around transition and identify opportunities to align strategies, roadmaps, goals and other targets related to human rights and climate.
5. With respect to minerals sourcing, consider taking part in collaborative or cross-industry initiatives such as the Responsible Lithium Partnership. These are designed to improve conditions on the ground and help to increase your leverage with suppliers.
6. Harness just transition benchmarks to help provide a roadmap with a common language, ensuring your company understands what is being asked of it.
7. Explore collaboration with other companies operating in renewable energy - including those looking to make the switch - and with NGOs, academia and other sectors of society. These collaborative efforts can help companies to proactively engage with and listen to the needs of stakeholders in relation to low-carbon projects.
These suggestions are activities that companies should already be doing in some form, or starting to take steps to do so. While there are significant challenges in achieving just transitions, one step forward is to make efforts to manage risks to people related to renewables in line with the UNGPs. As we move towards COP26, we need to be clear that business transitions into renewable energy should respect human rights.
There is much work to be done. To get started, visit the Business Practice Portal page on business, human rights and the climate crisis.
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