June 2021 marks the ten-year anniversary of the United Nations Guiding Principles on Business and Human Rights (UNGPs or the “Protect, Respect and Remedy” framework) which represent the first and only soft law reference in the world for responsible business conduct. Together with the OECD Guidelines and the ten principles of the UN Global Compact, these references form the backbone of the IMPA ACT responsible supply chain management system, built by and for the global shipping industry. To celebrate this huge milestone, MT spoke to Jasmine who manages IMPA’s sustainability portfolio, including the IMPA ACT programme, to demystify some of the things that often get muddled by members and non-members alike.
What is Responsible Supply Chain Management or RSCM?
RSCM involves minimising the adverse impacts of a company’s internal operations, while extending the same requirement to its wider value chain. Why do it? Because businesses can contribute massively to economic, environmental and social progress when they perceive their wider supply chain as an extension of their workforce and they set best practices across their supply chain. And because supply chain sustainability is a cross-cutting issue, companies need to apply their work across areas of human rights (including labour rights), environment and anti-corruption, ensuring a high level of traceability and that the responsibility of all parties involved is engaged. Step one in the process? Committing internally.
What is IMPA ACT then and why can I not do the work on my own?
IMPA ACT is a comprehensive system for Responsible Supply Chain Management, helping shipowners and ship suppliers align their business practice with the global minimum standard for Responsible Business Conduct. At the basis of the IMPA ACT programme sit the UN Guiding Principles on Business and Human Rights, the OECD Guidelines and the ten principles of the UN Global Compact. The UNGPs are the only internationally endorsed authoritative reference on responsible business conduct. Companies committing internally to abiding by these guides and establishing a regular social, economic, and environmental due diligence process as well as a remediation mechanism, are placing their business practice on the global standard and can get their social licence to operate. While you can certainly work on your own to document your impacts, you will find the process fairly complex, especially when the company does not benefit from the specialist eye of a sustainability analyst. IMPA ACT ensures that purchasing people, compliance managers and even HR can work to align their company’s practice with the global minimum standard for responsible business conduct, and this is thanks to our step-by-step processes and user-friendly resources.
Why should I adopt an RSCM practice?
Because you should want to align your practice with the global minimum standard, i.e. the UNGPs! Most companies already have internal processes that meet strict mandatory regulations towards labour rights, anti-corruption, and the environment. Good examples of such processes are employment contracts or compulsory policies on occupational health and safety. However, beyond these compulsory policies, there is still an expectation that businesses must act responsibly; part of this responsibility is making sure that all businesses within one’s supply chain are equally responsible. A business that manages its supply chain responsibly meets international expectations on human (including labour) rights, anti-corruption, and environment, easily identifies areas of saving costs and efficiencies, minimises risks internally and externally, and creates a stronger reputation for itself, while also building better relationships with suppliers and external stakeholders. This is where IMPA ACT fits in, as it offers a management system that is tailored for the shipping industry and that helps companies adopt responsible supply chain management practices easier and at a much lower cost. IMPA ACT is based on standardised tools, such as the IMPA ACT Supplier Code of Conduct, which add uniformity to the marine procurement industry and streamline work practices.
How much extra work would a process like IMPA ACT going to cause me?
Firstly, your company must understand that adopting a responsible approach to managing its supply chain is a commitment that needs both time and resources; it is not something that happens overnight. In a nutshell, the programme can be split in two phases: internal commitment and work with suppliers. That being said, IMPA ACT is extremely practical and provides step-by-step guidance to members on how to adopt a responsible supply chain management practice. The programme also provides a vast array of resources that come to your support; these can range from knowledge resources that allow you to familiarise yourself with sustainability issues, all the way to tools, calculators, and draft content to use on your sustainability journey.
What if my company already has a CSR programme and regularly donates to good causes?
A comprehensive CSR programme that is aligned with the minimum standard for responsible business conduct must start by identifying and documenting the company’s existing impacts on people, planet, and profit, and extending the same expectations to its business relationships. Donating a percentage of net profit or helping build a new school in a low-income country, while laudable actions in themselves, will not get a company out of its basic responsibility not to make its workers and its communities worse off.
Doesn’t the Maritime Labour Convention (MLC) 2006 already cover the issue of human rights?
Also known as the Seafarers’ Bill of Rights, the MLC is not an explicit human rights’ convention. The MLC sets out the minimum standards for decent working and living conditions for all seafarers, but does not cover companies’ duties to evaluate and mitigate their impacts across all 48 human rights, as enshrined in the International Bill of Human rights, including ILO’s core labour rights. In a nutshell, being compliant with the MLC 2006 does not make one compliant with the UNGPs, which is the global minimum standard.
Can anyone join IMPA ACT?
IMPA ACT membership is open to ship-owners, ship-operators, ship-managers, and ship suppliers, and companies of all sizes are encouraged to begin assessing their impacts today and work with their value chain towards increased visibility. The EU has already announced plans to make human rights, environmental and good governance due diligence compulsory from late 2021, and this can hugely influence even those outside the Union. There has been no better time to join than now!