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Social #sustainability should be a 'no brainer'.

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by: Hans van der Broek
Social #sustainability should be a 'no brainer'.

The Dutch SNS Bank positions itself as a climate bank, but social sustainability has also been central since its foundation. According to Irina van der Sluijs, commitment to social sustainability is a no-brainer: "Companies have to comply with all kinds of quality marks when it comes to consumer safety around toys or food, but taking human rights into account is voluntary, I just cannot do that."
Malasian woman making cloth
Irina van der Sluijs, human rights expert at ASN Bank, has just returned from Geneva, where around 2,500 people came together to discuss business and human rights. "That so many people come together indicates that it is an important topic," she says.
In 2008 John Ruggie published a framework that forms the basis for these meetings of the United Nations (UN). The work of the Harvard professor is groundbreaking, according to Van der Sluijs, because companies are partly held responsible for universal human rights.


Three pillars

Ruggie developed three pillars. The first means that governments have the responsibility to protect people: duty to protect. The second means that the business community must respect people: duty to respect. The third is that victims of human rights abuses can go somewhere to get their rights: access to remedy.
The UN guidelines are based on these three pillars. These guidelines have been adopted unanimously, which is again very special according to Van der Sluijs. The UN unanimously stated that it believes that companies account for the human rights of their employees in the supply chain. Van der Sluijs speaks of a duty of care.


Sense of responsibility

An important reason for the lack of responsibility lies in globalization, because the people who are concerned are literally far away. Van der Sluijs: "If a textile factory is in Brabant and the boss knows the employees, then he is more inclined to offer good working conditions."
According to her, the same applies to us as consumers: "With the longer supply chains you no longer have who makes your clothes, grow tea or put together a telephone."

Globalization

In the last part of the twentieth century, human rights are primarily a task for the government. This must translate human rights into national legislation. Partly because of this, these values ​​are anchored in Western European and North American legislation and enforcement is well regulated.
"Particularly vulnerable groups are not sufficiently protected by the government and society"
In many other countries, even in southern and eastern Europe, human rights are far less self-evident, says Van der Sluijs. "In those countries you see that especially vulnerable groups, such as poor families, unskilled workers, women and children, are not sufficiently protected by the government and society."
This becomes noticeable because Western companies expand their trade internationally in the nineties and nineties. These companies extract their raw materials from all over the world and reap the benefits of low wages and free trade. 


Lawlessness

"There was a gray area where almost lawlessness applied, because the national governments of supply countries were not able to protect their workers," explains Van der Sluijs. "Then you get a very strange situation in which nobody takes responsibility, because everyone is a little responsible."
"Globalization created a gray area where almost lawlessness applied"
That is why it is important that this responsibility be discussed now. In some countries it is even legally established.
For example, in 2015 the British government introduced the Modern Slavery Act. It states that companies must report annually what they do to the worst forms of child labor and debt bondage. The French government has also introduced a Loi Vigilance. And in the Netherlands, the Senate will shortly discuss the proposal for the Child Liability Care Act.


Business case

Van der Sluijs thinks that it should be perfectly normal for a company to take good care of its workers. Not only for its own employees, but for all workers in the chain. "If your company has a link with companies that hire vulnerable workers in poor countries, then you are responsible for those employees."
On the one hand, Van der Sluijs believes that human rights should be separate from the business case. On the other hand, she would like to make social impact measurable in order to offer a business perspective to companies.
According to her, this is one of the reasons why the focus has been on ecological sustainability for a long time, because the financial return of, for example, efficient resource use is quantifiable.


Social footprint

"You hear a lot about the carbon footprint, but there is also absolutely a social footprint," says Van der Sluijs. The social footprint of a company includes the effects on human rights that have not yet been discounted in the business model.
"You hear a lot about the carbon footprint, but there is also absolutely a social footprint"
This may include low wages, a ban on trade union membership, child labor, debt slavery or sexual harassment. "Then you are not talking about material risks, but about social risks", explains Van der Sluijs.
Leaving the world better for the next generation is not only about ecological, but also about social sustainability, says Van der Sluijs. She refers to the Brundtland Commission, which developed a concept in 1987 that ASN Bank uses as a normative framework.
In the report 'Our common future' the sustainability committee formulated as follows: 'Sustainable development is development that meets the needs of the present without compromising the ability of future generations to measure their own needs'.
Various companies, from food giant Unilever to carpet tile manufacturer Interface, set targets that take their social footprint into account. Investment universe
Only companies that come through the sustainability screening are eligible for a place in the investment universe. This means that the bank's sustainability department decides in which companies the investment department can invest. "Being purely profit-oriented is not sustainable in the long term, and companies have a duty of care for their social capital," says Van der Sluijs.
The bank assesses companies on the basis of sustainability criteria: governance, social and environmental issues. Human rights are covered by the social criteria. ASN Bank also looks at whether companies have drawn up social policy. The emphasis is increasingly on the chain.
Four core labor standards are central, identified by the UN's international labor organization: discrimination, trade union freedom, child labor and forced labor. The bank is less strict on certain criteria for smaller companies, so companies that want to improve can also be included in the universe.
ASN Bank then enters into discussions with other investors with the company concerned to see how improvements can be made. Currently they mainly focus on living wage in the clothing industry. This is slightly different from the minimum wage.


Living wage

Many international companies often pay employees the statutory minimum wage through their suppliers. However, in practice employees cannot get by on this. According to Van der Sluijs, in many countries there is a gap between the minimum wage and the amount of money needed to meet the basic needs.
By paying employees a living wage, child labor and excessive overtime can be prevented, says Van der Sluijs. If parents earn enough to make ends meet, they can send their children to school instead of to work. They do not have to make extra hours to make ends meet.
That is why ASN Bank, together with other financial investors such as Triodes and Pensioenfonds MN, is committed to living wages. They have set a target to have living wages implemented in the clothing sector by 2030.


Not a perfect story

This sounds far away, according to Van der Sluijs, but she points out that this is a complex process involving suppliers, textile factories, trade unions and local authorities. "It is not just a question of a company that pays more, but this money also has to end up with the worker."
The financial institutions use the UN guidelines as a guide that companies can follow on the road to viable wages. It concerns four steps that companies can take. The first is to formulate policy, the second is to examine the pay gap, the third is to consult with sector colleagues on how the pay gap can be tackled and the fourth is transparent.
"We do not have a perfect story," says Van Der Sluijs. As long as companies indicate that they are doing this, ASN Bank would like to help them to move on. Two years ago, the Erasmus University carried out a baseline measurement for the bank. This shows that most companies pay the minimum wage. "Naturally, this is fine from a legal point of view, but we want them to do a bit more," says Van der Sluijs.
Climate and human rights: two sides of the same coin
According to Van der Sluijs, it is logical that ASN Bank engages in social sustainability, because the bank was founded from a social point of view in the sixties. With attention for trade unions and the idea that workers should be able to save and live well and have the right to good health care and good education.
"From the founding of the bank, there was a sense of responsibility: the feeling that the task of a bank is more than the pursuit of financial returns," says Van der Sluijs.
ASN Bank is therefore at the same time a climate bank and an ethical bank. According to Van der Sluijs, the three pillars of the bank, biodiversity, the environment and human rights, therefore go together well. "All three pillars have to do with duty of care. Man, cares for the earth, for other people and for animals. That is where it all comes together for us.

By: Rianne Lachmeij, images: Shutterstock

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Hans van der Broek , founder Founder and CEO of WhatsOrb, world traveller, entrepreneur and environmental activist. Hans has countless ideas and has set up several businesses in the Netherlands and abroad. He also has an opinion on everything and unlimited thoughts about how to create a better world. He likes hiking and has climbed numerous five-thousanders (mountain summits of at least 5000m or 16,404 feet in elevation)  
Hans van der Broek , founder Founder and CEO of WhatsOrb, world traveller, entrepreneur and environmental activist. Hans has countless ideas and has set up several businesses in the Netherlands and abroad. He also has an opinion on everything and unlimited thoughts about how to create a better world. He likes hiking and has climbed numerous five-thousanders (mountain summits of at least 5000m or 16,404 feet in elevation)  
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