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| Allan Lerberg Jørgensen, Department Director at The Danish Institute for Human Rights. |
In 2011 The Danish Institute for Human Rights was engaged by Hydro to evaluate the company's approach to human rights issues. The institute carried out a gap analysis and delivered an action plan. “The work that we did with Hydro consisted of a facilitated self-assessment of human rights risks across company operations, a policy gap analysis and the development of an action plan. Throughout the process DIHR was met with a very open and honest attitude to the task at hand," says Allan Lerberg Jørgensen, Department Director at The Danish Institute for Human Rights.
“Hydro is doing well in managing its human rights issues. The company has a commitment to human rights, including the addition of a statement on human rights in its Sustainability Policy, membership in the United Nations Global Compact and a long-standing cooperation with Amnesty International Norway. However, the gap analysis pointed to a number of areas where Hydro’s commitment to human rights could be further integrated into corporate systems and practices. Through continuous dialogue with Hydro we found that the suggested improvements have been taken into account and that efforts are underway to ensure implementation”.
“How do you judge Hydro's awareness of human rights when it comes to establishing new industrial operations worldwide?”
“Our engagement with Hydro revealed a high degree of awareness of, and respect for, human rights throughout Hydro operations. Hydro is a member of the International Council on Mining and Metals (ICMM) and has a firm commitment to the use of the performance standards of the International Finance Corporation (IFC), the Equator Principles as well as the Voluntary Principles on Security and Human Rights (VPs),” he states.
“Have you seen any examples demonstrating the company’s ability to meet challenging issues or situations?”
“In recent years Hydro has expanded its business activities to include bauxite mining in South America. These activities have presented Hydro with a new set of human rights related challenges. One example is the impact on local communities. In connection with these issues Hydro has become a member of the ICMM. This membership has provided Hydro with valuable insight into sustainability management in the extractives industry and has led to new obligations for Hydro in relation to human rights and related due diligence processes. In combination with the results of the analysis conducted by us, Hydro is currently working on how to improve the management of these new challenges”.
“With reference to the gap analysis, what do you consider to be the most significant findings?”
“The gap analysis resulted in many interesting findings. The following issues were among the most significant.
- The need for a clear policy statement and standard on human rights and to clarify governance structures for human rights issue management
While Hydro has a commitment to human rights, Hydro does not have a statement of formal policy or standards that clearly define human rights expectations for Hydro's operations.
- The need to clarify standards for social and human rights impact assessment and to create project level grievance mechanisms
Despite the importance attributed to social impact assessments, there seems to be a lack of internal standards and guidance, which makes it unclear how Hydro will manage these assessments. Hydro could improve the chances of the external stakeholders, including the potentially affected communities, of providing input to impact assessments.
Finally, we found that Hydro did not have a framework for implementing project-level grievance mechanisms. However, we were informed that as part of its ICMM membership Hydro is in the process of developing such a framework.
- The need to improve processes for supplier segmentation and auditing on the basis of human rights-related risk and concerns.
While Hydro has a number of initiatives aimed at responsible supply chain management, there is no clear process to define when and how supplier audits should take place. We suggested that Hydro should further define the circumstances of the audits and decide whether second or third tier audits should be conducted when there is a suspicion of severe human rights impacts”.
“What is your impression regarding Hydro's reception of the analysis?”
“The analysis was well received. The action plan was presented to the Business Areas and key action owners were identified”.
“Hydro has operations in some countries that do not permit free trade unions. How do you judge the company’s ability to handle the particular challenges related to this?”
“Hydro's Global Framework Agreement ensures that most of Hydro's employees are protected when it comes to their right to freedom of association and collective bargaining in accordance with international standards and guidelines. However, this agreement only applies to direct Hydro operations and is limited by local law. In order to deal with areas were local law does not secure or even curtails freedom of association and collective bargaining, Hydro has instituted guidelines on finding alternative methods of association. However, in the reviewed policies there is no clear indication of how these alternative methods work nor is there any indication of what the internal responsibilities would be for implementing these measures. There also appears to be a lack of policies and systems in place to deal with e.g. discrimination, job termination and harassment of union representatives and members,” says Allan Lerberg Jørgensen.
“We recommend that Hydro put in place procedures to monitor enterprise-wide rates of unionization and collective bargaining. The aim of this process is to identify legal and practical barriers to association and collective bargaining in specific countries and projects. We also recommend that Hydro strengthens its position and internal overview of alternative means of association and collective bargaining in countries where association and/or collective bargaining are curtailed by law or in practice. On the basis of these measures, Hydro should provide internal guidance on acceptable and recognized characteristics and structures for alternative procedures.”
