CHAPTER 8 KICK-STARTING HUMAN RIGHTS DUE DILIGENCE: THE ROLE OF HUMAN RIGHTS IMPACT ASSESSMENTS

• Jurisdiction: United States

Human Rights Law and the Extractive Industries
(Feb 2016)
CHAPTER 8
KICK-STARTING HUMAN RIGHTS DUE DILIGENCE: THE ROLE OF HUMAN RIGHTS IMPACT ASSESSMENTS
Mark Wielga ²
Attorney and Director
Nomogaia
Denver, CO
Lloyd Lipsett ¹
Shift Project
Montreal, QC

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LLOYD K. LIPSETT is an international human rights lawyer with over 15 years of experience working with leading companies, governments, national human rights institutions, civil society organizations, and indigenous peoples. He has developed a niche in the field of human rights impact assessment with a focus on extractive industry projects and free trade agreements. He has special expertise in indigenous peoples' rights, economic, social, and cultural rights, and stakeholder engagement. He regularly publishes and makes presentations on a wide range of human rights issues relevant to companies, industry associations, governments, and investors. Lloyd founded LKL International Consulting Inc. in 2009 and joined Shift as a part-time Advisor in 2013. He previously served as the senior assistant to three Presidents of Rights & Democracy from 2003 to 2008. He began his career as a corporate litigator at McMillan Binch in Toronto. His education is from Queen's University in philosophy and politics, and then from McGill University in law. He is a member of the Law Society of Upper Canada.

MARK WIELGA is a Director of Nomogaia, a non-profit think-tank devoted to business and human rights. He has over 20 years direct experience with human rights in action. He has managed and performed human rights impact assessments on large footprint corporate projects in Africa, Asia, and Latin America. He has worked with transnational corporations to design and implement corporate human rights policies as well as emergency responses to urgent human rights controversies. Mr. Wielga has extensive experience representing and advising transnational companies in the extractive industries and has assisted industry groups on human rights and corporate social responsibility issues. He has taught, lectured, and published on human rights and corporate social responsibility in law schools and universities around the world. Mr. Wielga is a lawyer licensed in the United States and his extensive international legal experience informs his human rights work.

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The following paper explains what are human rights impact assessments (HRIAs) and how they relate to other impact assessment processes commonly used by extractive sector companies and how they can strengthen company efforts to enhance their human rights due diligence. Given that HRIAs are grounded in international human rights law, respond to emerging national and industry standards about business and human rights, as well as the internal policies of some of the major mining and oil and gas companies, extractive industry lawyers should be familiar with this emerging field of practice that is highly relevant to business and human rights.

Through an examination of two case studies (the HRIA of the Bisha Mine in Eritrea and HRIA of the Kayelekera Mine in Malawi) the paper provides insights into how HRIA methodologies are being applied in practice in the mining sector. It then provides reflections on what emerging good practice for HRIAs looks like--or should look like--and how they can be used more effectively. Finally, the co-authors offer some concluding reflections on the future of HRIAs and the role of lawyers in supporting their effective use as a strategic tool for better human rights due diligence, particularly in circumstances where there are high risks to human rights

1. Introduction to Human Rights Impact Assessments

The following section provides a brief overview of some of the key features of HRIAs, as well as their relationship to environmental and social impact assessments and their utility as a strategic tool to strengthen human rights due diligence.

f. What are HRIAs?

Human rights impact assessments (HRIAs) are processes for systematically identifying, predicting and responding to the actual or potential human rights impacts of a business operation, capital project, government policy, or trade agreement. They are designed to complement a company or government's other impact assessment and due diligence processes and to be framed by appropriate international human rights principles and conventions. They are also rooted in the realities of the particular project by incorporating the context within which it will operate from the outset, and by engaging directly with those peoples whose rights may be at risk.³

While HRIAs can be undertaken for government activities such as the negotiation of free trade agreements or the implementation of international development programs, the focus of this paper is on private sector investments and projects--particularly in the extractive industry.

There are a number of different HRIA tools that have been developed over the past decade to guide practitioners in terms of the methodological steps to be followed and the questions and

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indicators to be used for the assessment of different human rights issues.⁴ Nonetheless, the actual practice of conducting HRIAs is quite novel and there are relatively few HRIAs in the public domain. Sometimes practitioners joke that there are more methodologies available than examples of actual HRIAs. Moreover, as a significant proportion of HRIA practice have been conducted confidentially, it is challenging to fully describe the state of play in this field.⁵

It is important to note, however, that there currently are no laws or regulations that require companies to undertake HRIAs, although some large global companies (including in the extractive sector) have recently adopted internal policies requiring HRIAs for their existing and future projects.⁶ Since the adoption of the UN Guiding Principles on Business and Human Rights (the "UN Guiding Principles") in 2011 and subsequent developments in related international, national and industry standards, there is a stronger rationale for companies to consider HRIAs as part of their broader efforts to undertake human rights due diligence. However, to be clear, the UN Guiding Principles do not specifically require HRIAs and rather refer generically to the assessment of impacts on human rights, which could be undertaken through other impact assessment processes than a stand-alone HRIA.

To date, several HRIAs have been undertaken by companies in response to conflict, crises and pressures from socially-responsible investors and NGOs. Moreover, HRIAs have been undertaken by civil society organizations on behalf of affected communities in order to respond to allegations of human rights abuses that are not being adequately addressed by companies and/or governments. This has led to debates about the relative merits of company-led HRIAs vs. community-led HRIAs and a degree of mutual suspicion and polarization around certain HRIA processes based in large part on who is commissioning the HRIA rather than on the merits of the methodology, scope and objectives of the assessment. In some cases, this has even led to "dueling HRIAs" where two HRIAs are being undertaken about the same project--one commissioned by the company and one commissioned by a civil society organization.⁷ In response to this potential polarization of the field of practice, some practitioners are now

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calling for collaborative processes, whereby companies and civil society organizations cooperate on developing and conducting HRIAs.⁸

To complicate matters further, there is quite a range in terms of the scope of assessments that are called HRIAs, ranging from desk-top reviews of human rights risks, to assessments of a company's compliance with international human rights standards and/or internal human rights policies, to participatory assessments of impacts with substantial input from affected stakeholders and civil society organizations. In addition, there are now HRIAs focused on specific issues (e.g. children's rights impact assessments) and that assess an entire economic sector in a given country (i.e. sector-wide impact assessments).

Despite the diversity of HRIA methodologies, the range of actors conducting or commissioning HRIAs, and the paucity of published examples of HRIAs, some key features of HRIAs can be distilled:⁹

• International human rights standards are used to frame the assessment;

• The full scope of human rights impacts (positive and negative, actual and potential, direct and indirect) should be considered;

• The most severe and likely negative human rights impacts should be prioritized for detailed assessment;

• The assessment process should integrate rights-based principles of empowerment, participation, non-discrimination, prioritization of vulnerable groups, transparency and accountability;

• There should be significant and structured engagement with rights-holders ¹⁰ (workers, community members and their representatives) and experts on the local human rights context; and

• The assessment should result in recommendations for effectively addressing negative human rights impacts identified and for strengthening human rights due diligence measures in order to avoid or minimize any potential impacts, including on-going monitoring measures.

f. How are HRIAs related to environmental and social impact assessments?

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In many ways, the impetus for HRIAs has developed out of the experience with environmental and social impact assessments (ESIAs). Since the first environmental impact assessments (EIAs) were conducted in the 1960s, most jurisdictions now have legal requirements and regulated procedures for the conduct of EIAs for major infrastructure and industrial development that would cover most extractive projects. Over time, leading environmental impact assessment practice started to include a more fulsome discussion of the social impacts of projects on...