Exploring a criteria to evaluate Human Rights practices in businesses

By Riya Jain & Abhinash Jena on November 25, 2024

Rights are privileges, entitlements, or freedoms individuals are morally or legally allowed to have, enjoy, or exercise. Human rights are the basic rights and freedoms that belong to every individual, regardless of nationality, ethnicity, gender, religion, or other status. These rights are inherent to all human beings and are considered fundamental for living with dignity, freedom, equality, justice, and peace.

International frameworks like the UN Guiding Principle on Business and Human Rights (UNGP) and the Universal Declaration of Human Rights (UDHR) are the corporation’s base for respecting, protecting, and fulfilling the rights of affected communities, customers, and workers (European Union, 2019; OHCHR, 2018). Companies that integrate human rights into their operations ensure compliance with both strategic and moral responsibility. It is essential to provide a safe working environment, fair labour practices, and prevent harassment and discrimination to promote an inclusive and healthy work environment (Vijayakumar & Rajagopal, 2023). Including human rights practices in corporate practice provides an opportunity for long-term value creation and operational sustainability.

Human rights standardization in businesses in advancing UNDP Sustainable Development Goal (SDG) 12
Human rights standardization in businesses in advancing UNDP Sustainable Development Goal (SDG) 12

Significance of integrating human rights into corporate and business practices in India

Integrating human rights into corporate and business practices is essential for achieving SDG 12. It ensures that economic growth and development are inclusive, equitable, and sustainable, benefiting both individuals and the environment. SDG 12 emphasizes sustainable and ethical practices throughout supply chains and encourages the efficient use of resources while minimizing negative impacts on people and the planet. The corporate landscape in India is evolving with the focus of companies towards integrating human right practices. The national action plan on business and human rights encourages businesses in India to respect these rights and address the issues of anti-corruption, environmental sustainability, and labour rights (Ministry of Corporate Affairs, 2018).

Businesses adopting human rights standards ensure fair wages, safe working conditions, and the prohibition of exploitative practices such as child labour and forced labour. Companies like Bharat Petroleum have integrated global policies into their human rights policies focused on areas such as (Bharat Petroleum Corporation Limited, 2024):

  • Equal opportunity, non-discrimination, diversity, and inclusion
  • Harassment-free workplace
  • Freedom of association
  • Labour standards
  • Health workplace safety and environment
  • Children’s Rights Protection and Child Safeguarding, Prohibition of Child Labour, and Forced Labour
  • Right to privacy
  • Anti-corruption and bribery
  • Local community
  • Right to development
  • Workplace security

Adhering to rights empowers workers by ensuring their voices are heard through grievance mechanisms, freedom of association, and the right to collective bargaining. Companies that uphold human rights are more likely to maintain transparency in their operations, reporting their social and environmental impacts. The payment of minimum wage has become a significant aspect for businesses in India. Mahindra and Mahindra reported in 2023-24, 100% more than the minimum wage payment to all employees and permanent workers while at least minimum wage payment to contractual workers (Mahindra and Mahindra Limited, 2024).

Despite such policy developments and the adoption of human rights policies, labour status is still poor in India. In 2024, the minimum wage for unskilled labour was revised to Rs 20,358 per month, for semi-skilled workers it is Rs 22,568 per month and for skilled workers it is Rs 24,804 per month (The Hindu, 2024). However, a report by ILO (2018) shows that in India more than 33% of the wage workers were given less pay than the country’s minimum wage level and this low pay rate was even higher among women compared to men.

Despite being the largest labour market, India faces challenges like poor regulation, exploitation, and low wages, leading to a poor standard of living for workers. This is especially true in the logistics sector, where manual labour is crucial, yet there are no dedicated skill enhancement policies. Skill gaps among workers also reveal the sector’s limited focus on maintaining basic human rights (KPMG, 2007; EY, 2022).

Essential criteria for evaluating companies

Percentage of employees having human rights training: It is the total workforce percentage who have received formal training in human rights practices, policies, and issues. The measure ensures that the employees are equipped with the knowledge required for addressing and recognizing human rights violations within the organization.

Minimum wage compliance: The measure defines the extent of company adherence to the minimum wage laws for its workers and employees. The compliance of the company with the minimum wage law is required to protect workers from any form of exploitation and ensure fair compensation.

Complaints related to sexual harassment, discrimination, child labour, forced labour, wages, and other human rights issues: The company’s responsiveness to handling complaints and its ability to promote its workforce for reporting issues define the commitment of the company to upholding ethical standards.

Percentage of differently abled employees and workers: The measure reflects the proportion of employees and workers who are differently able in the company’s workforce. Inclusive hiring practices ensure to provision of equal opportunities to differently-abled individuals to promote workforce diversity.

Percentage of female representation in the Board of Directors and key management personnel: To reflect the equality and inclusivity of the company it is important to provide equal leadership opportunities to females.

References

NOTES

I am an interdisciplinary educator, researcher, and technologist with over a decade of experience in applied coding, educational design, and research mentorship in fields spanning management, marketing, behavioral science, machine learning, and natural language processing. I specialize in simplifying complex topics such as sentiment analysis, adaptive assessments and data visualizatiion. My training approach emphasizes real-world application, clear interpretation of results and the integration of data mining, processing, and modeling techniques to drive informed strategies across academic and industry domains.

I am a Senior Analyst at Project Guru, a research and analytics firm based in Gurugram since 2012. I hold a master’s degree in economics from Amity University (2019). Over 4 years, I have worked on worked on various research projects using a range of research tools like SPSS, STATA, VOSViewer, Python, EVIEWS, and NVIVO. My core strength lies in data analysis related to Economics, Accounting, and Financial Management fields.

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