Respecting rights

Our commitment to human rights

The Universal Declaration of Human Rights calls upon “every individual and every organ of society” to promote respect for human rights. The foundation of international human rights law is the United Nations’ 1948 Universal Declaration of Human Rights (UDHR). The UDHR is not legally binding but is an aspirational set of standards and principles. Securing and delivering human rights is ultimately the responsibility of government, but businesses can play their part too by upholding and promoting human rights within their spheres of influence.

We seek to do this in three ways:

• in our operations by upholding our values and standards
• in our relationships with our suppliers, and
• by working through external initiatives, such as the United Nations Global Compact.

Our Code of Business Principles

Our Code of Business Principles sets out our commitment to human rights. It confirms that “We conduct our operations with honesty, integrity and openness, and with respect for the human rights and interests of our employees”.

The section of our Code dealing with employees clearly states our opposition to forced and child labour and sets out our respect for employees’ right to freedom of association.

Reviewing our approach

We have reviewed our approach to human rights to ensure that we continue to live up to the standards in our Code of Business Principles and that we have effective communications and compliance mechanisms in place.

Our review has shown that further training would be beneficial to explain the different elements of human rights. Employees would also benefit from clearer definitions of these elements, such as freedom of association, collective bargaining, forced/bonded labour and child labour. An e-learning module outlining these four core human rights will be rolled out to key managers in our supply chain, including procurement and human resources, in the second half of 2011. We are also in the process of upgrading the definitions of these core elements in the detailed employee guidelines that explain our Code of Business Principles. These updated guidelines will ensure our employees understand the importance and intent of the human rights elements of our Code.

Compliance monitoring of our human rights obligations is delivered via our positive assurance process. This will be complemented by a system of continuous improvement (akin to the systems we use for safety, health and environment), based primarily on self-assessment at site level and supported by periodic external audits.

The self-assessment methodology is designed to be consistent with that used to monitor our suppliers’ compliance with our Supplier Code. We pilot tested this enhancement to our processes in 2008 and are rolling it out across our factory operations worldwide now and over the next three to four years.

Human rights & our business partners

Our human rights commitment is also reflected in the way we work with our business partners and suppliers. Unilever’s Supplier Code makes clear the standards to which we expect our business partners to adhere. It contains 11 principles covering business integrity and responsibilities relating to employees, consumers and the environment. Four of its principles address human rights, stating that there shall be:

• respect for human rights, and no employee shall suffer harassment, physical or mental punishment, or other forms of abuse
• no use of forced or compulsory labour, and employees shall be free to leave employment after reasonable notice
• no use of child labour, and specifically there will be compliance with relevant International Labour Organization (ILO) standards
• respect for the right of employees to freedom of association and recognition of employees’ rights to collective bargaining, where allowable by law.

Living out our commitments with our employees

These commitments are of no practical use unless they are part of an active process of compliance, monitoring and reporting. The Board of Unilever is responsible for this process and day-to-day responsibility lies with senior management around the world.

In 2010, we have introduced a new, streamlined framework of 26 Code Policies that underpin the Code of Business Principles. These have been communicated to all senior management globally and their review and acknowledgement of these has been completed. The plan is to communicate these Code Policies to all managers during 2011.

All reported breaches of the Code of Business Principles are monitored by regional Code Committees and the Global Code and Policy Committee. We expect and encourage employees to bring to our attention any breach of the Code. A 24-hour toll-free ‘ethics hotline’ number is available in all countries for individuals who wish to raise any concerns in relation to the Code (on an anonymous basis if they wish and where local laws allow this). In 2010, 98 employees were dismissed as a result of breaches of the Code, up from 77 in 2009.

Living out our commitments with our business partners

We also use a positive assurance process with our suppliers. We have communicated Unilever’s Supplier Code to all our current suppliers of ‘production items’ (ie, the raw materials and packaging we use to make our products) to gain their assurance that they adhere to its principles. We are now following up with those suppliers we have prioritised for more detailed assessment and a programme of audits.

Together with some of our peer companies, in 2007 we established a global Programme for Responsible Sourcing (PROGRESS). As part of this, we have agreed on a common approach to evaluate the social and environmental performance of suppliers across specific groups of goods and services. We believe this collaborative approach will help reduce duplicated effort for PROGRESS members and suppliers alike, accelerating the process of assessing suppliers and freeing up resources to focus on implementing improvements within the supply chain.

See the Suppliers section for more detail.

Promoting human rights

We seek to work with other companies, labour and civil society organisations to promote human rights issues globally and locally.

Global initiatives

We are a founding signatory to the Global Compact, a United Nations initiative which sets out commitments for business in relation to human rights, labour, the environment and anti-corruption. We are committed to upholding these principles across our business.

To mark the 60th anniversary of the Universal Declaration of Human Rights in December 2008, we joined members of the Global Compact in endorsing support for human rights:

“On the occasion of the 60th anniversary of the Universal Declaration of Human Rights, we, business leaders from all corners of the world, call on governments to implement fully their human rights obligations. We also reiterate our own commitment to respect and support human rights within our sphere of influence. Human rights are universal and are an important business concern all over the globe.”

In 2010 we joined the UN Global Compact LEAD. This involves 50 companies of the 8,000 Global Compact members, who are committed to integrating sustainability within their business models and supporting the UN Global Compact around the globe.

We also co-chaired the UN Global Compact’s Working Group on Partnerships with the UN to help improve and strengthen public–private partnerships with the UN and to help deliver on the Millennium Development Goals (MDGs). Our CEO Paul Polman will present our recommendations to the UN Secretary General at the MDG Summit in September 2011.

We are members of the Global Business Initiative on Human Rights which is aimed at helping companies understand their human rights obligations.

Local initiatives

In five municipalities in the state of Goias in Brazil, Unilever Brazil works with the local community and government to ensure children are not exploited in the tomato plantations of its suppliers.

The Infancia Protegida (Protected Childhood) initiative has been running since 2003 and is aimed at preventing children from working in the plantations. So far around 22 000 children have been reached.

In partnership with the Councils of Children’s and Adolescents’ Rights, Tutorship Councils, local government and the community, Unilever Brazil has devised practical initiatives that support children’s development and ensure they do not have to be left alone while their parents are at work. These include crèches, medical care and advice on nutrition, as well as systems to prevent pupils from dropping out of school.

A complementary initiative, Rural Responsavel (Responsible Rural Project), focuses on raising awareness of health and safety issues for farm workers, reinforcing the message that child labour should not be tolerated. Rural Responsavel covers more than 50 farmers and around 2 000 farm workers. In 2007 Unilever Brazil terminated a contract with one of its suppliers for failing to maintain our health and safety standards.

Labour relations

Between 2006 and 2009, four complaints were brought to Unilever’s attention by the International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations (IUF) relating to our operations in India and Pakistan. A further complaint was submitted by the Turkish transport union TUMTIS in 2008.

These complaints concerned site closure (Sewri factory, India), freedom of association and collective bargaining (Doom Dooma, India) and the use of temporary and contracted labour at our factories in Pakistan (Rahim Yar Khan and Khanewal).

Under the terms of the OECD Guidelines for Multinational Enterprises, the unions referred their complaints to the OECD’s National Contact Points in the UK and Turkey for investigation.

Four cases have been resolved and the means of resolution has been agreed for the fifth case relating to the Doom Dooma factory. This is in the process of being implemented.

To summarise:

• The TUMTIS complaint at our supplier’s factory in Turkey was resolved locally in January 2009.
• Unilever Pakistan reached agreement with the IUF to resolve the dispute at the Rahim Yar Khan factory in June 2009. On 21 October 2009, Unilever Pakistan reached an agreement relating to a further IUF complaint at Khanewal (retroactively applicable to 15 October 2009).
• A settlement payment was agreed by Hindustan Unilever and local trade union representatives (HLEU) on 13 October 2009 relating to the closure of the Sewri factory in 2006.
• A methodology for resolving the issues at Doom Dooma, India has been reached and is in the process of being implemented.

A more detailed description of the four cases relating to our operations in India and Pakistan is provided in a downloadable pdf – see Related links.

Summary of the OECD complaints process: OECD Guidelines for Multinational Enterprises

The OECD’s Guidelines for Multinational Enterprises are recommendations addressed by governments to multinational enterprises.

The Guidelines provide voluntary principles and standards for responsible business conduct in a variety of areas, including employment and industrial relations. Through national contact points (government offices), the Guidelines provide a mechanism to bring issues to the attention of companies and a forum in which to discuss them.

National contact points seek to resolve issues through amicable discussion to the satisfaction of all parties involved – a process the OECD describes as conciliation. If conciliation fails, complaints are referred to the second stage in the process – mediation – in which an independent facilitator takes a more formal role in brokering an agreement. Should this also fail, the national contact point issues a statement or makes a recommendation.

Inherent in the OECD process is an investigation of the facts in order to validate the substance of the complaint. As a responsible business, Unilever supports the OECD’s Guidelines.

Taking action

The disputes involving our India and Pakistan operations have stimulated us to think more broadly about the use of third-party contract labour in our factories. As a result, we are implementing a range of actions. These include:

Developing new, more detailed management guidelines for our senior HR and supply chain managers to raise awareness of the need to comply with international best practice in the areas of human and labour rights. These have been rolled out globally during 2010 and will be complemented by a training programme that includes ‘train the trainer’ events, cascading the programme through the whole HR factory community, and e-learning modules for use by line management. We will target in the first instance those countries (such as India and Pakistan) where this is recognised to be a priority.

• We are working with the Danish Institute for Human Rights, an independent, national human rights institution to develop a comprehensive set of management guidelines and to pilot a training programme for Unilever’s senior HR and Supply Chain leadership. The first major training session took place in the summer of 2010.

Reviewing the manner in which contract labour is used across the business.

• This process has already begun. We are committed to finalising an internal review of our use of temporary and contract labour in all our manufacturing (factory) operations by the end of 2011.

Widening the scope of the third-party auditing programme under Unilever’s Supplier Code to include third-party service providers of temporary or contract workers at our factory operations.

• During 2009, Unilever conducted a number of third-party audits of our key third-party service providers of temporary labour in our factory operations. Initially, these audits focused on countries where concerns about the treatment of temporary labourers has been greatest – namely India and Pakistan. The work is being further widened to other factories during 2010-2011.

Improving the transparency of the information that we provide for our stakeholders on these issues – notably (though not exclusively) through our corporate website and sustainability reports.

• We have updated our corporate website to provide additional information regarding the settlement of OECD cases, in particular those cases relating to Sewri, Rahim Yar Khan and Khanewal. An agreement on a methodology to resolve the outstanding Doom Dooma case was reached and published on the OECD website in September 2010. This agreement is in the process of being implemented. We will provide more details when the time is right to do so.

Building on informal dialogue in place with the IUF regarding our labour practices by moving to a more formal consultative mechanism with the IUF during the course of 2010.

• We hosted a formal meeting at global level with the IUF on 18 March 2010. The meeting was attended by trade union representatives from a number of key regions including Latin America, the US, Europe (including Works Council), Asia (including Japan) and Africa as well as by senior HR and Supply Chain counterparts from Unilever. It was agreed to convene regular meetings with the IUF to discuss labour practices internationally. A follow-up meeting was held in November 2010 and a further meeting in March 2011.

Furthermore, we plan to engage in dialogue with organisations such as the OECD, ILO and UN Global Compact (as well as the IUF) on how we can bring greater clarity on the responsibilities of companies in this complex area.

• During 2009, Unilever started dialogues with a number of key stakeholders on this issue. We have for example:

Participated in a major research project and workshops with ten other corporate members of the UN Global Compact from the Netherlands to evaluate the issues and challenges companies such as Unilever face in integrating respect for human and labour rights within their business (in line with Professor John Ruggie’s recommendations). The consolidated report was published by the UN Global Compact during its Leaders Summit 2010 (24-25 June 2010) in New York.

Supported the development of a second research project with the Danish Institute for Human Rights to develop ‘best practice’ models for corporations seeking to integrate human rights within their business strategy. This report was published in June 2010 to coincide with the UN Global Compact Summit.

We will take the learnings from participating in these research programmes to further evaluate how best to strengthen our approach to addressing human rights and core labour standards.