Last month, German sportswear giant, The Adidas Group (Adidas), quietly released its “Third Party Complaint Process for Breaches to the Adidas Group Workplace Standards or Violations of International Human Rights Norms” (the Process). Although the document is not perfect, and it is impossible to fairly evaluate the process without examining how it functions in practice, Adidas appears to have created a strong grievance mechanism that passes muster under the United Nations Guiding Principles on Business & Human Rights.
The company points out that it already has a “worker’s rights complaint process,” which has been in effect for more that 10 years, and that this grievance mechanism builds on that process. The other model for the new process, we are told, was the grievance mechanism established by the London Organizing Committee for the 2012 Summer Olympic Games’ (LOCOG), with which Adidas is uniquely familiar. (On four separate occasions in 2012, Adidas was accused of violating LOCOG's responsible sourcing code and had to avail itself of the LOCOG grievance process.)
The detail: The key aspects of the Process are as follows:
According to the U.N. Office of the High Commissioner for Human Rights (OHCHR), a company “need not” require that a complaint rise to the level of an actual human rights violation before it can be raised. Rather, a company should seek to identify any “legitimate concerns” of those who may be adversely impacted by the company’s activities.
The Guiding Principles themselves identify additional features of effective non-judicial grievance mechanisms (Guiding Principle 31). They should:
Build on existing processes: As the Guiding Principles gurus at Shift point out, it is not uncommon for a company-sponsored grievance mechanism to involve or touch upon other remediative systems already in place at a company -- what Shift calls a company’s remediation “ecosystem." These may include whistleblower hotlines, HR or consumer complaint processes, auditing procedures and trade union engagement procedures, to name a few.
Importantly, the Guiding Principles do not require companies to create separate “human rights” grievance mechanisms. Instead, where a remediation “ecosystem” is already in place, a company should leverage existing processes while ensuring that there are no gaps between what exists and what is required by international law. Where such gaps do exist, they must be plugged, but the company needn’t start from scratch.
Importance of stakeholder engagement: At a Shift workshop in May on the topic of grievance mechanisms, business leaders highlighted the link between stakeholder engagement and an effective grievance mechanism. They noted that, where stakeholders do not trust a company, they are unlikely to avail themselves of a company-sponsored grievance process in the first place, so stakeholder engagement that builds trust between the company and the community at the outset is crucial to future success.
The good: On the surface, the Process does a few key things well. For one, it is clear and described in sufficient detail. It also allows for (but does not mandate) engagement with various stakeholder groups, something that is strongly encouraged by the Guiding Principles, the OHCHR commentary and the business leaders interviewed by Shift. The Process acknowledges the importance of transparency and that all parties remain fully informed throughout. It builds upon existing grievance mechanisms, rather than simply adding another layer to the “ecosystem.” Finally, the Process calls for remediation and monitoring where an adidas entity caused or directly contributed to a harm -- the standard articulated by the Guiding Principles.
The bad: The primary shortcoming of the Process, at least as it reads, seems to be that it requires complaints to allege a “breach” of an international human rights norm in order for Adidas to initiate an investigation. This is contrary to the OHCHR’s recommendation that a company seek to identify any “legitimate” human rights concerns. A stronger position would be for Adidas to accept any complaints that allege human rights impacts, and then use the investigation process to determine whether or not a breach occurred. The concern here is that Adidas will filter out complaints that, while insufficient to require remediation nevertheless deserve the company's attention -- particularly where the alleged misconduct could devolve into a human rights violation down the road.
The unknown: Much about the Process' success and legitimacy is difficult to determine at this stage. For instance, on the face of the document, it is impossible to know how the Process was developed. Adidas does not tell us whether or not it engaged with stakeholders, only that it used its experience with the LOCOG mechanism as a model. We also cannot know whether it will foster trust, whether it will be known to all relevant parties, or whether outcomes will satisfy internationally recognized human rights.
Nevertheless, Adidas should be commended for putting together what appears to be a robust process and for acknowledging its role in preventing and remediating human rights violations.
Image credit: Flickr/sneakerphotography
Trained as a lawyer, I now focus on legal business development, corporate social responsibility (CSR), and business & human rights. My past experience includes work on complex commercial litigation, international human rights advocacy, education policy, pro bono legal representation, and analysis of CSR challenges in both the private and public sectors.