Monitoring of the National Action Plan on Business and Human Rights

06.11.2019 - Article

Within the scope of a monitoring process being carried out between 2018 and 2020, the German Government is reviewing to what extent companies based in Germany are meeting their due diligence obligations anchored in the NAP. The first interim report is now on the table.

The key elements of due diligence

The objective of the NAP monitoring is to determine whether at least half of all companies in Germany with more than 500 employees to will have integrated the core elements of human rights due diligence into their business processes in a verifiable manner by 2020. The German Government is supporting the companies in this task. The NAP Help Desk offers all companies confidential and personal advice regarding the NAP and Monitoring.

You can find a short introductory film about the NAP and human rights due diligence here.

Interim Report - initial findings and next steps

In autumn 2018, interviews were carried out with 30 businesses in the exploratory phase. At this stage, producing representative statistics was not the aim. There were also talks with nine representatives of stakeholder groups, that is, social partners, business associations and non-governmental organisations. The Inception Report drawn up in September 2018 served as the basis for work during this phase. The interviews yielded valuable findings and the business interviews in 2019 and 2020 will provide an opportunity to delve deeper. The first Interim Report on NAP monitoring presented in July 2019 outlines the findings and the methodology for the quantitative surveys. A summary at the start of the Interim Report provides a brief overview. The questionnaire for the 2019 survey is also part of the Interim Report. The most important parts of the methodology are also explained below.

All ten ministries of the Interministerial Committee on Business and Human Rights approved the Interim Report after intensive consultations. The Business and Human Rights Working Group of the National CSR Forum was involved in the report’s drafting phase. The Federal Foreign Office has commissioned the auditing firm Ernst & Young, which won the contract in an EU-wide tender in May 2018, to carry out the surveys. Ernst & Young is leading a consortium which also comprises Systain Consulting, Adelphi consult and Focusright.

2019 survey – questionnaire phase completed

By the 31 October 2019 deadline for answering the questionnaire, over 400 companies had taken part in the 2019 survey. This means that the minimum number of evaluable responses from companies laid down by the German Government on the basis of an established statistical method has been reached. The 2019 survey can thus provide representative findings. The data will now be evaluated in accordance with the process explained in the interim report. The aim is to publish a report on the 2019 survey in early 2020 that will evaluate compliance with human rights due diligence in a nuanced way on the basis of the responses to the survey.

Foreign Minister Maas commented:

In the age of globalisation, companies bear an increasing responsibility for human rights protection all across the world. For this reason, Germany has implemented the National Action Plan for Business and Human Rights continuously since 2016.

The initial evaluation shows however that the aims have not yet been achieved. If the initial results of the monitoring are confirmed, we should look at the possibility of statutory regulations. This is a way of creating incentives for businesses to commit to respect for human rights. And at the same time it will provide a framework for naming and shaming if they do not.

In November 2018, five federal ministers sent a letter  on behalf of the IMA to all companies that can be included in the NAP monitoring process and requested their active participation.

Before the survey was launched in July 2019, Foreign Minister Maas commented as follows:

Germany and the German economy are reaping the benefits of globalisation. That is why we have a particular responsibility to protect the rights of the people working in our global supply and value chains. Businesses in Germany are now being asked to report how they ensure human rights are respected in their processes – and what challenges they encounter on the way. Now the businesses in question need to use the opportunity and respond.“

Transparency and expertise

Apprentice using a metal-boring tool
Taking a closer look at business processes© Liesa Johannssen/photothek.net

The German Government is keen to make the monitoring process transparent and to base it on methodologically sound academic standards. A nuanced evaluation system will ensure that the reviewed requirements regarding the content and implementation of the core elements by the companies are reasonable. The evaluations will be anonymised and comply with applicable data processing legislation.

The requirements with regard to human rights due diligence anchored in the NAP are considered to be implemented if a company has introduced all five core elements of human rights due diligence to an adequate extent. The monitoring also takes into account the possibility that a company may be able tp provide reasonable grounds for not being affected by individual risks or for not (yet) implementing certain procedures or measures. The questionnaire will provide for a comply or explain mechanism in all questions.

In the questionnaire, companies can submit their implementation planning for individual NAP requirements by the end of 2020. This planning must be credible, concrete and meaningful. In early 2021, the German Government will verify whether the companies have actually put these plans into practice. Until that time, such companies will not be regarded either as ”compliers“ or ”non-compliers“. The final report, which will be presented in the summer of 2020, will then be supplemented in the light of post-validation.

The information provided by companies in the questionnaire will undergo a multi-stage plausibility review. For example, their answers will be compared with media and NGO reports; follow-up questions may be asked and external stakeholders may be requested to provide information.

The question and answer options are based on Chapter III of the NAP. In uncertain cases, the text of the UN Guiding Principles on Business and Human Rights was used to define the requirements in more detail. The Interim Report provides transparent information as to which parts of the NAP or UN Guiding Principles the questions and answers are based on (see appendix 5 to the Interim Report).

The reports on the findings of the 2019 and 2020 survey will be published. These findings will show what percentage of the large companies in Germany meets the NAP criteria and what percentage does not. In order to acknowledge that companies have made a tangible effort to comply with human rights due diligence, the reports will also provide information on a group of companies that are ”non-compliers“, but already making good progress (”companies on the right track“, i.e. a maximum of three unsatisfactory responses, but no gaps in key elements of due diligence, and a recognisably good overall performance).

No statement regarding compliance with the NAP requirements can be made about companies that do not provide information (non-responders). In particular, they cannot be included in the group of companies that meet the requirements of the NAP. The reports will also state the number of non-responders. In addition, data will be collected and existing data evaluated to compare the companies that provided information and the non-responders in order to see whether there is any problematic bias in the results due to systematic differences in the response behaviour of individual groups of companies. In such cases, the German Government will decide on steps to correct this.

All ministries in the Interministerial Committee on Business and Human Rights are very closely involved in the design and support of the monitoring process. Business associations, trade unions and civil society are also advising the Federal Foreign Office on this process. The approach and results will be presented to a wider public at several dialogue events.

From 2020 onwards, the findings of the monitoring process will form the basis for the German Government’s decision on further steps in the field of business and human rights. These steps can include legislative measures.

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