Assessing social risk in agricultural supply chains

Responsible commodity sourcing is often associated with delivering on commitments to no-deforestation; however it is also about respecting human rights and delivering positive social impacts.

Recently Proforest facilitated a workshop in Amsterdam with some of the world’s leading consumer goods manufacturers and commodity traders to discuss how social risk information can help companies to meet their responsible sourcing commitments. We also shared Proforest’s work on developing approaches to assessing social risk at scale.

 

Companies that have made responsible sourcing commitments for agricultural commodities typically begin by mapping their supply chains back to the original fields and factories, which may reveal the presence of thousands of production sites in multiple countries. The next step is to engage with suppliers to understand impacts on workers and communities, support improvements on the ground, and monitor progress against commitments. However, selecting where to allocate resources to begin this process – or where to invest more substantially in follow-up interventions – is not easy.

Global risk assessment approaches often rely on using GIS maps of deforestation in combination with the volumes purchased; meaning that the risks of negative social impacts can take a back seat in prioritization exercises, and hence potentially in engagement strategies. 

Participants at the workshop heard an update from Proforest on our improved desk-based risk assessment methodology to help companies to identify labour and land rights issues that can be used at scale across multiple countries in a supply chain.

 

The work, supported by Cargill and AAK, focuses on palm oil but there is scope to expand it to other commodities. Proforest aim to go beyond national-level reports and indices to identify differences among individual producers and subnational regions in relation to risks of child labour, forced labour, inadequate health and safety and land rights abuses and disputes.

Although there are challenges in understanding risks when so many labour and land issues go unreported, methods and data sources are improving. Workshop participants discussed a range of techniques for assessing social impact, including worker voice tools, tenure risk modelling and gaining insight from experts into trends in their local sectors.

The workshop was hosted by Cargill, who were joined by representatives from the sustainability or sourcing departments of AAK, BASF, Danone, IKEA, Neste, Nestlé, PepsiCo, Unilever and Vandemoortele. Experts from Daemeter, TFT, TMP Systems and WRI also attended.

Participants showed great interest in learning about approaches to social risk using data on underlying risk factors, but also feeding in actual ‘occurrence’ information such as from on-site visits, grievances, or NGO input. There was a shared sense of need to collaborate in collecting social data and in supporting suppliers and stakeholders on social issues. More needs to be done to understand and communicate the complexity of social issues in agricultural production, and to use risk assessment to channel resources into improvements for workers and communities.

In the light of the discussions at the workshop, Proforest are now reviewing progress and next steps with their methodology, and will continue to work on the approach, with the support and collaboration of Cargill and AAK and other interested companies and peers.

 

Find out more

For more information about our work on social risk in responsible sourcing please contact Rebecca Smalley, Senior Project Manager rebecca@proforest.net.

For more information on Proforest’s work on human rights and social issues in responsible production and sourcing of agricultural and forest products please contact Dawn Robinson, Director for Social Responsibility and Human Rights dawn@proforest.net