Environmental Due Diligence and Human Rights

Environmental Due Diligence and Human Rights is a critical and rapidly evolving area of international law, business ethics, and corporate governance. The intersection of Environmental Due Diligence and Human Rights revolves around the concept of Human Rights Due Diligence (HRDD), which explicitly includes environmental protection.

Here is a comprehensive breakdown of the rights of people in the context of environmental due diligence and human rights.

Core Concept: The Inextricable Link

A clean, healthy, and sustainable environment is a fundamental prerequisite for the enjoyment of a wide range of human rights. Conversely, environmental degradation almost always leads to human rights violations.

The connection is simple: When a company pollutes a river, it isn’t just harming the ecosystem. It is potentially violating the rights of people who depend on that river for:

• Life, Health, and Water: (Right to Life, Right to Health, Right to Water) Contamination can cause illness, birth defects, and death.
• Food: (Right to Food) Poisoned water and soil can destroy fisheries and agriculture.
• Housing and a Decent Standard of Living: (Right to Adequate Housing) Pollution can make areas uninhabitable, forcing people to relocate.
• Culture: (Rights of Indigenous Peoples) For indigenous communities, land, rivers, and forests are often central to their cultural and spiritual identity. Their destruction is a cultural violation.
• Property: (Right to Property) Pollution can devalue or destroy land and homes.

Therefore, Environmental Due Diligence is not just about compliance with environmental laws; it is a core component of protecting human rights.

What are the “Rights of People” in This Context?

The “rights of people” primarily refer to the rights of communities and individuals affected by business operations, including workers, local residents, and indigenous peoples. These rights are enshrined in international frameworks and, increasingly, national laws.

1. Right to a Clean, Healthy, and Sustainable Environment

In July 2022, the UN General Assembly formally recognized this as a universal human right. This is the overarching right that binds environment and human rights together. It implies that states and businesses have a duty to protect this right.

2. Right to Information (Transparency)

People have the right to know about projects that may affect their environment and lives. This includes:

• Access to Environmental Impact Assessments (EIAs).
• Information on pollutants, emissions, and waste management.
• Clear details about the potential risks and benefits of a project.

3. Right to Public Participation

People have the right to be meaningfully involved in decision-making processes before decisions are made. This is not just a one-way information flow but a dialogue. It means:

• Consulting with affected communities early and throughout the project lifecycle.
• Ensuring participation is free, prior, and informed (especially for Indigenous Peoples).
• Considering community input in the final decision.

4. Right to Free, Prior, and Informed Consent (FPIC)

This is a specific and strengthened right for Indigenous Peoples (as outlined in the UN Declaration on the Rights of Indigenous Peoples – UNDRIP). Before a project can proceed on their traditional lands, companies must:

• Free: Consent is given without coercion, intimidation, or manipulation.
• Prior: Consent is sought sufficiently in advance of any authorization or commencement of activities.
• Informed: All relevant information about the project (risks, impacts, benefits) is provided in an accessible and understandable manner.
• Consent: The community has the right to give or withhold its consent.

5. Right to an Effective Remedy

When environmental harm and human rights abuses occur, people have the right to a remedy. This includes:

• Access to judicial and non-judicial grievance mechanisms.
• The ability to seek compensation for lost livelihoods, health impacts, and property damage.
• Guarantees that harm will be stopped and not repeated.

What is Environmental and Human Rights Due Diligence?

Due diligence is the process companies should use to identify, prevent, mitigate, and account for how they address their environmental and human rights impacts. It’s a continuous, proactive, and reactive process.

Key Steps in the Due Diligence Process:

1. Identify and Assess Actual and Potential Impacts: This is the core. Companies must map their entire value chain (operations, suppliers, contractors) to find where environmental harm (e.g., pollution, deforestation, water scarcity, biodiversity loss) could lead to human rights abuses.
2. Prevent and Mitigate Impacts: Integrate findings into policies and management systems. Change plans, adopt cleaner technologies, set up monitoring systems, and train staff and suppliers.
3. Track Effectiveness: Monitor the performance of mitigation measures to ensure they are working.
4. Communicate How Impacts are Addressed: Be transparent about your findings, actions, and progress. This is often done through sustainability reports.
5. Provide for or Cooperate in Remediation: Establish or participate in accessible grievance mechanisms to address harms when they do occur.

The Legal and Regulatory Landscape (The “Teeth”)

This is no longer just a voluntary “corporate social responsibility” issue. It is becoming a legal requirement.

• UN Guiding Principles on Business and Human Rights (UNGPs): The global standard, establishing the corporate responsibility to respect human rights, which includes conducting due diligence.
• OECD Guidelines for Multinational Enterprises: Includes detailed guidance on conducting due diligence for both human rights and the environment.
• Emerging Mandatory Due Diligence Laws:
  • France: Duty of Vigilance Law (2017): Requires large companies to create and implement a “vigilance plan” to identify and prevent severe human rights and environmental risks in their operations and supply chains.
  • Germany: Supply Chain Due Diligence Act (2023): Mandates human rights and environmental due diligence across companies’ supply chains.
  • EU: Corporate Sustainability Due Diligence Directive (CSDDD) (Approved 2024): This is the most significant development. It will require large EU companies to conduct due diligence on their environmental and human rights impacts, with civil liability for damages.
• Climate Litigation: Citizens and NGOs are increasingly suing companies and governments for failing to adequately address their environmental and climate impacts, framing it as a human rights issue.

Conclusion

The rights of people in the context of environmental due diligence are about shifting the paradigm from “doing no harm” to “actively respecting and protecting” the communities and environments where businesses operate. It is a fundamental expectation that companies will proactively assess how their actions affect people’s right to a healthy environment, involve them in decisions, and provide redress when things go wrong. This is no longer a niche concern but a central pillar of responsible business conduct and legal compliance in the 21st century.

What is Required Environmental Due Diligence and Human Rights

The Foundational Requirement: The Right to a Clean, Healthy, and Sustainable Environment

This is the umbrella right, recognized by the UN. It is the ultimate objective. To fulfill this, a specific process is required. This process is Human Rights Due Diligence (HRDD) with integrated environmental assessment.

The core requirement is that companies must proactively identify, prevent, mitigate, and account for their adverse environmental and human rights impacts throughout their operations, value chains, and business relationships.

The 5 Required, Actionable Rights of People

For the “Right to a Clean, Healthy, and Sustainable Environment” to be meaningful, it must be broken down into specific, enforceable rights that people can claim during the due diligence process.

1. The Right to Be Identified and Consulted (Proactive Inclusion)

• What is Required: Companies cannot operate in a vacuum. They are required to:
  • Map Stakeholders: Proactively identify all communities, groups, and individuals who may be affected by their operations, including vulnerable and marginalized groups.
  • Reach Out: Actively engage with these groups through culturally appropriate means.
  • Do This Early: This must happen at the earliest stages of project planning, before key decisions are locked in.

2. The Right to Free, Prior, and Informed Consent (FPIC) – For Indigenous Peoples

• What is Required: This is a specific, non-negotiable right for Indigenous Peoples, not a general consultation. It requires:
  • A Process, Not a Veto: While not a unilateral veto in all legal frameworks, it requires a good-faith negotiation to reach agreement. Withholding consent carries significant legal and reputational consequences.
  • Formal Consent: A formal agreement must be sought and obtained from the legitimate representatives of the Indigenous community before project approval.
  • Scope: FPIC is required for projects affecting their traditional lands, territories, resources, and cultural heritage.

3. The Right to Transparent and Accessible Information

• What is Required: People cannot participate meaningfully if they are kept in the dark. Companies are required to provide:
  • Understandable Data: All project-related information—including Environmental and Social Impact Assessments (ESIAs), risk analyses, and mitigation plans—in local languages and accessible formats.
  • Full Disclosure: Information on potential pollution, health risks, economic impacts, and both benefits and harms.
  • Ongoing Updates: Continuous communication about project changes, incident reports, and monitoring data.

4. The Right to Meaningful Participation and Influence

• What is Required: This goes beyond just being heard. It requires:
  • Dialogue, Not a Monologue: A two-way process where community concerns and knowledge are genuinely considered and reflected in project design and decision-making.
  • Influence on Outcomes: The company must demonstrate how public participation influenced the final project plan and the choice of mitigation measures. If concerns are rejected, a clear rationale must be provided.

5. The Right to an Effective Remedy and Access to Grievance Mechanisms

• What is Required: When rights are violated, people must have a path to justice. This requires:
  • Operational-Level Grievance Mechanisms: Companies must establish accessible, transparent, and safe channels for individuals and communities to raise concerns and seek resolution without fear of retaliation.
  • Access to Judicial Remedy: People must have access to courts and legal systems to seek compensation, injunctions, or other forms of justice.
  • Effective Remediation: When harm is found, the company must provide appropriate remediation, which can include compensation, restitution, rehabilitation, and guarantees of non-repetition.

What is Required of Companies? (The Due Diligence Process)

To respect the rights listed above, companies are legally required in many jurisdictions to implement a rigorous due diligence process. This is the practical manifestation of their duty.

The Legal “Teeth”: What Makes These Requirements Mandatory?

These are not just good practices. They are increasingly enforceable through:

• Mandatory Due Diligence Laws: The EU’s CSDDD, Germany’s Supply Chain Act, and France’s Duty of Vigilance Law legally require companies to conduct this process. Failure can result in fines, civil liability, and exclusion from public procurement.
• Civil Liability: Under these laws, if a company fails in its due diligence duties and causes harm, affected people can sue for damages in the company’s home country courts.
• Investor & Consumer Pressure: Investors are increasingly screening for ESG (Environmental, Social, Governance) risks, and consumers are demanding ethical products. A failure in due diligence poses a direct financial risk.

Conclusion

The required rights of people are a set of actionable claims to information, participation, consent (where applicable), and remedy. These are not abstract ideas but are now legally operationalized through the required process of environmental and human rights due diligence.

Who is Required Environmental Due Diligence and Human Rights

The short answer is that the requirement falls on two primary groups: States (Governments) and Businesses (Companies). However, the nature of their requirement is different.

Here is a detailed breakdown of “who is required” to respect the rights of people in the context of environmental due diligence and human rights.

1. States (Governments) – The Duty to Protect

Under international human rights law, states are the primary duty-bearers. Their obligation is to protect their citizens from human rights abuses, including those caused by environmental harm from third parties, such as businesses.

What is required of States?

• Regulate and Legislate: Enact and enforce strong environmental and human rights laws. This includes setting clear standards for pollution, land use, water quality, and requiring Environmental Impact Assessments (EIAs) that include a robust social and human rights component.
• Mandate Due Diligence: Create laws that require companies to conduct human rights and environmental due diligence in their operations and global value chains. Examples include the EU’s CSDDD, Germany’s Supply Chain Act, and France’s Duty of Vigilance Law.
• Adjudicate and Provide Remedy: Ensure that their judicial systems are accessible, impartial, and effective. When rights are violated, the state must provide a path for affected people to seek justice, compensation, and remediation.
• Enforce and Monitor: Actively monitor business compliance and have the capacity to investigate violations and impose meaningful penalties (fines, sanctions, etc.).

2. Businesses (Companies) – The Responsibility to Respect

The corporate responsibility to respect human rights is a global standard, meaning it exists independently of whether a state has fully enacted it into law. It requires businesses to act with due diligence to avoid infringing on the rights of others.

What is required of Businesses?

This requirement applies to all companies, but its scale and complexity will vary with the size, sector, and context of the business.

• Large Multinational Corporations (MNCs): They have the greatest responsibility. They are required to conduct due diligence across their entire global value chain, including subsidiaries, suppliers, contractors, and business partners. They are the primary target of new mandatory due diligence laws.
• Small and Medium Enterprises (SMEs): While they may have fewer resources, the same principles apply. Their due diligence process will be proportional to their size, the riskiness of their sector, and their place in the value chain. They are often required to provide information and comply with the due diligence demands of the larger companies they supply.
• Banks, Investors, and Financial Institutions: They have a dual responsibility:
  1. To conduct due diligence on their own internal operations.
  2. To conduct due diligence on the clients and projects they finance (often called “ESG Risk” or “Environmental and Social Risk” assessment). Financing a project that causes environmental and human rights harm makes them complicit.

What specific business functions are required to implement this?

• Senior Management & Board of Directors: Ultimate accountability. They are required to oversee the due diligence process, integrate it into corporate governance, and publicly commit to respecting human rights.
• Legal & Compliance Teams: Required to understand and ensure adherence to emerging mandatory due diligence laws.
• Supply Chain & Procurement: Required to map the supply chain, assess supplier risks, and contractually obligate suppliers to meet environmental and human rights standards.
• Environmental, Health & Safety (EHS) Teams: Their role expands from technical compliance to understanding how environmental impacts (e.g., emissions, waste) translate into human rights risks for communities.
• Risk Management: Required to integrate human rights and environmental risks into the company’s overall risk management framework.
• Community Relations/Public Affairs: Required to manage the processes of stakeholder engagement, consultation, and operating grievance mechanisms.

A Third, Crucial Group: The Right-Holders

While not “required” in the sense of having a legal duty, it is essential to identify the rights-holders—the people whose rights must be respected. They are the reason the requirement exists.

• Local Communities: People living near company operations whose health, water, food, and livelihoods are directly impacted.
• Indigenous Peoples: Hold specific, strengthened rights, particularly the right to Free, Prior, and Informed Consent (FPIC) regarding projects on their traditional lands and territories.
• Workers: Both a company’s direct employees and those in its supply chain, who have rights to a safe and healthy work environment, which includes protection from environmental hazards.
• Future Generations: The concept of a “healthy and sustainable environment” implicitly includes the rights of people in the future, requiring sustainable resource management today.

Summary: The Interplay of Responsibilities

The requirement works as a system:

1. People (Right-Holders) have rights to a healthy environment, information, participation, and remedy.
2. States (Duty-Bearers) are required by international law to protect those rights from business-related abuse. They do this by creating and enforcing laws that…
3. Require Businesses (Responsibility-Holders) to respect those rights by conducting environmental and human rights due diligence.

When is Required Environmental Due Diligence and Human Rights

The Overarching Principle: It’s Continuous

Human Rights and Environmental Due Diligence (HREDD) is not a one-off audit or a box-ticking exercise. It is an ongoing, proactive, and reactive process that should be embedded into a company’s core operations. The requirement to respect rights exists as long as the company exists and has relationships.

However, there are specific, critical moments when the requirement is most acute and legally scrutinized.

Key Triggering Events and Timelines

1. At the Very Beginning: The Planning & Design Phase

This is the most critical “when” for preventing harm. The requirement kicks in before any concrete action is taken.

• When exploring a new project, market, or investment: Before acquiring land, signing contracts, or allocating major capital.
• When designing a new product or service: Considering the entire lifecycle, from sourcing raw materials to disposal.
• Before engaging with new suppliers, partners, or contractors: Due diligence on business partners is required before signing a contract.

Why here? This is when the company has the greatest ability to avoid harm by choosing less damaging alternatives, locations, or technologies. It is when Prevention is most cost-effective and respectful of rights.

2. During Major Operational Changes

The requirement is reactivated whenever there is a significant change in the status quo.

• When expanding operations, scaling up production, or entering a new phase of development.
• When changing processes (e.g., introducing a new chemical, waste disposal method).
• During mergers and acquisitions (M&A): Conducting rigorous due diligence on the target company’s environmental and human rights record is now a standard legal and financial requirement.

3. In Response to Specific Events or Risks

The requirement becomes urgent and specific when a potential or actual impact is identified.

• When a risk is identified through mapping or assessment (e.g., identifying a high-risk supplier or a vulnerable community near a operation).
• When a grievance is raised through a company mechanism, by a community, or by an NGO.
• After an incident, such as a spill, accident, or community conflict.
• When new information becomes available (e.g., new scientific data on a pollutant’s health effects, a new report on supplier practices).

Why here? This triggers the Mitigation and Remediation phases of the due diligence cycle. The company is required to act immediately to stop, mitigate, and address the harm.

4. At Regular Intervals: The Cyclical Review

Even without a triggering event, the process must be periodically renewed.

• Annually or Biennially: Regular review of the entire due diligence process, updating risk assessments, and checking the effectiveness of mitigation measures. This is often aligned with reporting cycles for sustainability or integrated reports.

When is it Legally Required? The “Compliance When”

Beyond the operational “whens,” there are specific legal and financial deadlines.

• Upon the enactment of a law: For companies falling under the scope of laws like the EU CSDDD, the German Supply Chain Act, or the French Duty of Vigilance Law, the requirement becomes legally mandatory on the law’s specific effective date. For example, the EU CSDDD will be phased in from 2027 for the largest companies.
• When facing financing or investment: Banks and investors increasingly require evidence of robust HREDD as a condition for loans or investment under their own ESG frameworks.
• When entering a public tender: Many governments now require bidders to demonstrate their due diligence processes.
• When litigating: It is required now as a defense. In court, a company can be asked, “What did you do to identify and prevent this harm?” A robust, documented due diligence process is the primary evidence of having met the required standard of care.

Summary Table: The “When” of Requirements

Conclusion

The requirement to respect the rights of people through environmental due diligence is not a question of “if” or “when” for a responsible business. It is always present.

The key is to understand that the intensity and focus of the requirement shift based on the company’s activities. The most important “when” is BEFORE harm occurs, during the planning stages. However, the legal and ethical obligation is continuous, applying to both proactive prevention and reactive remediation throughout the entire lifecycle of a business relationship or project.

Where is Required Environmental Due Diligence and Human Rights

The Overarching Principle: The Global Scope

The foundational principle of the UN Guiding Principles on Business and Human Rights is that a company’s responsibility to respect rights exists regardless of the local context. This means:

• If local laws are weak, the company must still meet the international standard.
• If the host government is corrupt or repressive, the company must find ways to respect rights to the greatest extent possible and avoid benefiting from abuses.

This global scope is captured in the concept of “territorial jurisdiction” for states and “value chain jurisdiction” for businesses.

1. Where are States Required to Enforce These Rights? (The “Duty to Protect”)

States are primarily required to protect rights within their own territorial jurisdiction.

• Within Their Own Borders: This is the clearest case. A government must regulate all companies operating on its soil.
• Extraterritorially (Beyond Their Borders): This is a rapidly evolving area. There is a growing expectation and legal precedent for home states (where a parent company is headquartered) to regulate the overseas conduct of their companies. This is the basis for laws like:
  • The EU’s CSDDD: It applies to EU-based companies and their global value chains.
  • France’s Duty of Vigilance Law: It applies to the global operations of large French companies.
  • Germany’s Supply Chain Act: It applies to the global operations of German companies of a certain size.

So, for states, the “where” is their own territory and, increasingly, the global activities of their domiciled companies.

2. Where are Businesses Required to Respect These Rights? (The “Responsibility to Respect”)

For businesses, the requirement applies throughout their entire “value chain.” This is a broader term than “supply chain” and includes three key areas:

A. Own Operations (Direct Control)

This is the most direct area of responsibility.

• Where: All company-owned or controlled facilities, including headquarters, factories, mines, warehouses, offices, and retail stores.
• Example: Ensuring that a company’s factory does not pollute the local water supply of the community where it is located, anywhere in the world.

B. Supply Chain (Upstream Activities)

This is where the most significant and complex risks are often found.

• Where: The entire network of suppliers, contractors, and sub-contractors that provide raw materials, components, or services.
• Example: A smartphone company is responsible for ensuring that the minerals in its batteries are not mined using child labor, or that the textile factory making its clothes does not dump toxic chemicals into a river. This applies even if the supplier is located in a different country with weaker laws.

C. Business Relationships (Downstream & Lateral)

This extends the responsibility to other entities the company is connected to.

• Where:
  • Downstream: This includes the use, maintenance, and disposal of products after they are sold (product lifecycle). It can also involve distributors and logistics partners.
  • Lateral: This includes joint venture partners, consortiums, and other non-supplier business relationships.
• Example:
  • An automotive company may have a responsibility regarding the safe disposal of its car batteries.
  • A company in a joint venture to build a dam is responsible for the human rights impacts of that entire project, not just its “share” of the work.

Summary Table: The “Where” of Requirements

Geographic Hotspots: Where is Risk Most Concentrated?

While the requirement is global, the risks are heightened in specific contexts:

• Conflict-Affected and High-Risk Areas (CAHRAs): Operating in or sourcing from conflict zones carries an extreme risk of being linked to severe human rights abuses. Enhanced due diligence is required here.
• Countries with Weak Governance: Where environmental and labor laws are lax or poorly enforced, the onus shifts to the company to uphold the higher standard.
• Areas with Indigenous Peoples and Local Communities (IPLCs): Operations on or near traditional lands and territories carry the specific requirement for Free, Prior, and Informed Consent (FPIC).
• Ecologically Sensitive Areas: Operations in or near biodiversity hotspots, protected areas, or stressed watersheds carry a higher risk of causing irreversible environmental and social harm.

Conclusion

The requirement to respect the rights of people through environmental due diligence is not limited by geography. It follows the company’s global footprint.

For a community living near a mine, the “where” is their village.
For a worker in a distant factory, the “where” is their workplace.
For an indigenous group whose river is polluted by a supplier, the “where” is their ancestral territory.

The modern legal and ethical expectation is that a company must know and show that it is respecting rights everywhere its influence extends—from its headquarters to the farthest reaches of its value chain. This is the essence of “corporate responsibility to respect” in a globalized economy.

How is Required Environmental Due Diligence and Human Rights

The Overarching “How”: The Human Rights & Environmental Due Diligence (HREDD) Process

This is the structured framework that companies are required to implement. It’s a continuous cycle, not a one-time event.

How Companies are Required to Implement It: The 5-Step Framework

1. How to IDENTIFY & ASSESS Impacts

This is the diagnostic phase.

• How it’s done:
  • Mapping the Value Chain: Creating a detailed map of all suppliers, contractors, and business partners from raw material to end-of-life.
  • Stakeholder Engagement: Proactively identifying and consulting with affected communities, workers, Indigenous groups, and NGOs. This is not a PR exercise; it’s about gathering critical on-the-ground knowledge.
  • Environmental & Social Impact Assessments (ESIAs): Conducting rigorous, ongoing studies that specifically analyze how environmental changes (e.g., water depletion, pollution) will impact human rights (e.g., right to water, health, food).
  • Risk Data & Tools: Using standardized risk indicators, country-level data, and tools like the HRIA (Human Rights Impact Assessment).

2. How to PREVENT & MITIGATE Impacts

This is the action phase.

• How it’s done:
  • Integrating Findings: Embedding the results of the assessment into corporate policies, management systems, and decision-making.
  • Changing Operations: Modifying project designs, investing in cleaner technology, changing sourcing practices, or even abandoning high-risk projects.
  • Capacity Building: Training company staff and suppliers on human rights and environmental standards.
  • Leveraging Contracts: Making contractual agreements with suppliers conditional on their compliance with environmental and human rights codes of conduct.
  • Implementing FPIC: For Indigenous Peoples, this means establishing a formal, good-faith negotiation process to secure their consent before proceeding.

3. How to TRACK Effectiveness

This is the monitoring phase.

• How it’s done:
  • Key Performance Indicators (KPIs): Tracking metrics like water quality, emission levels, number of grievances received and resolved, and community health data.
  • Audits & Verification: Conducting regular, unannounced audits of own operations and suppliers by internal or third-party auditors.
  • Ongoing Stakeholder Dialogue: Maintaining continuous communication with communities to monitor if conditions are improving or deteriorating.

4. How to COMMUNATE Performance

This is the accountability phase.

• How it’s done:
  • Public Reporting: Publishing an annual sustainability report or a dedicated Human Rights Report that discloses:
    • Identified risks and impacts.
    • Actions taken to prevent and mitigate them.
    • The effectiveness of those actions.
    • How grievances are being addressed.
  • Transparency: Making non-sensitive ESIAs and mitigation plans publicly available, especially for affected communities.

5. How to PROVIDE or COOPERATE in REMEDIATION

This is the justice phase.

• How it’s done:
  • Establishing Grievance Mechanisms: Creating accessible, safe, and transparent channels for individuals and communities to raise concerns without fear of retaliation. These must be legitimate and trusted, not just a “checkbox.”
  • Providing Remedy: When a company has caused or contributed to harm, it must provide a remedy, which can include: compensation, apologies, restitution of the environment, medical care, or guarantees that the harm will not be repeated.
  • Participating in State-Based Mechanisms: Cooperating with judicial processes and government-led investigations.

How States are Required to Enforce It: The “Duty to Protect”

States enable and enforce the corporate process through a “smart mix” of measures:

• How through Law-Making: Enacting Mandatory Due Diligence Laws (e.g., EU CSDDD) that legally require companies to implement the 5-step process outlined above.
• How through Regulation: Enforcing strong environmental protection agencies, labor inspectorates, and land-use planning laws.
• How through Adjudication: Ensuring courts are open and effective for victims to sue companies for harms, including those that occur overseas (a growing trend known as transnational litigation).
• How through Policy: Using public procurement policies to only contract with companies that demonstrate robust due diligence.

How Civil Society and Rights-Holders Enforce It: The “Pushing” Mechanisms

Even without laws, there are powerful enforcement mechanisms:

• How through Advocacy & Naming/Shaming: NGOs and communities investigate and publicize corporate abuses, damaging reputations and brand value.
• How through Litigation: Filing lawsuits against companies in domestic or international courts for human rights and environmental violations.
• How through Grievances: Using the company’s own grievance mechanisms or international complaint bodies (like the OECD National Contact Points) to seek redress.
• How through Market Pressure: Consumers and investors increasingly make choices based on a company’s ESG (Environmental, Social, Governance) performance, creating a financial incentive for good practice.

Summary: The “How” in Practice

Conclusion

The “How” is the operationalization of responsibility. It is no longer enough for a company to say it respects rights; it must demonstrate it through a verifiable, ongoing process.

The requirement is fulfilled by embedding a dynamic system of identify, prevent, mitigate, track, communicate, and remediate into the very DNA of a corporation, backed by the legal force of state regulation and the vigilant oversight of civil society.

Case Study on Environmental Due Diligence and Human Rights

Tedi Mine & the Indigenous Peoples of Papua New Guinea

This case is a classic, stark example of what happens when environmental due diligence and human rights are ignored, and the decades-long struggle for remedy that follows.

1. Background: The Project and the People

• The Company: Ok Tedi Mining Limited (OTML), initially a consortium led by BHP Billiton (now BHP), one of the world’s largest mining companies.
• The Location: Star Mountains, Papua New Guinea (PNG). The mine is at the head of the Ok Tedi River, a tributary of the Fly River.
• The People: Approximately 50,000 Indigenous Peoples from dozens of villages who rely on the river system for their food, water, transportation, and cultural identity.
• The Initial Plan: The original plan included a dam to hold the 80 million tons of mine waste (tailings) produced annually. This was a critical environmental control measure.

2. The Failure of Due Diligence & The Human Rights Impacts

The crisis unfolded due to a sequence of failures in the due diligence process.

A. Failure to Prevent and Mitigate (The Critical Event):
In 1984, before production even began, the proposed tailings dam collapsed during construction. Instead of pausing to find a viable alternative, BHP and its partners, with the agreement of the PNG government, decided to operate the mine without any waste containment system. For decades, the mine directly dumped billions of tons of chemically processed waste and rock into the Ok Tedi River system.

This was a catastrophic failure of the “prevent and mitigate” step. The company prioritized short-term production over long-term environmental and social risk.

B. The Resulting Human Rights & Environmental Impacts:
The environmental destruction directly violated the rights of the Indigenous communities:

3. The Struggle for Remedy: How Rights Were Asserted

The affected people were not passive. They used multiple avenues to seek justice, demonstrating the “right to remedy.”

• Litigation (Using the Company’s Home State): In 1994, representing 30,000 landowners, a law firm sued BHP in its home country of Australia. This was a landmark use of “transnational litigation,” arguing that the parent company had a duty of care. The case was settled out of court in 1996 for approximately $500 million (AUD), which was used for cleanup and compensation.
• Continued Advocacy & Further Legal Action: The settlement did not stop the pollution. Continued advocacy led to a second lawsuit. In 2001, facing an even larger legal battle, BHP agreed to a new settlement that involved funding a long-term mine waste management program and transferring the majority of its ownership to a PNG development fund, effectively walking away from the project to limit its liability.

4. Analysis: The Due Diligence Failures

Let’s analyze this case through the modern HREDD lens:

• Identify & Assess: BHP was aware of the risks. The initial plan for a tailings dam proves they knew the waste was hazardous. The assessment was there, but it was ignored.
• Prevent & Mitigate: This was the core failure. The conscious decision to operate without a tailings dam was the ultimate failure to mitigate a known, catastrophic risk. Economic and operational pressures overrode human rights and environmental concerns.
• Track & Communicate: For years, the company downplayed the extent of the damage. Independent scientific studies later revealed the true scale, showing a failure in honest communication.
• Remediate: Remediation has been partial, costly, and late. The ecosystem is fundamentally altered, and full restoration is impossible. While financial compensation was provided, it could not restore the lost health, culture, and environment.

5. Legacy and Lessons Learned

The Ok Tedi case became a global symbol of corporate irresponsibility and had a profound impact:

1. Catalyst for Industry Change: It directly led to the creation of the “No-Go” commitment by the International Council on Mining and Metals (ICMM), which states that members should not explore or mine in World Heritage Sites. More broadly, it forced the entire mining industry to re-evaluate its tailings management and community relations.
2. Blueprint for Transnational Litigation: It showed affected communities in developing countries that they could seek justice in the home courts of powerful multinational corporations.
3. Highlighted the Limits of Remedy: It demonstrates that some environmental and cultural harm is irreversible. Money is a poor substitute for a lost way of life and a poisoned ecosystem. Prevention is infinitely better and cheaper than cure.
4. Strengthened the Case for Mandatory Due Diligence: Ok Tedi is a textbook example used by advocates arguing for laws like the EU’s CSDDD. Under such a law, a company making a decision like BHP’s would face legal liability in its home country from day one, potentially forcing a different, more responsible outcome.

Conclusion

The Ok Tedi case is a tragic but essential case study. It vividly illustrates the direct causal link between environmental degradation and severe human rights violations. It shows the catastrophic consequences of a corporation failing in its most basic duty: to prevent foreseeable harm. The decades-long struggle for justice by the Indigenous peoples of the Fly River system underscores why the “rights of people” must be legally and operationally central to any corporate activity, enforced through rigorous and mandatory environmental and human rights due diligence.

White paper on Environmental Due Diligence and Human Rights

The escalating climate and biodiversity crises, coupled with persistent social inequalities, have exposed a critical flaw in the global economic model: the systemic externalization of environmental and human rights costs. This white paper argues that the concepts of Environmental Due Diligence (EDD) and Human Rights Due Diligence (HRDD) are two sides of the same coin, and must be integrated into a single, mandatory framework—Human Rights and Environmental Due Diligence (HREDD). We demonstrate that a clean, healthy, and sustainable environment is a fundamental human right and a prerequisite for the enjoyment of other rights. Through analysis of emerging regulations and case studies, we outline the legal, financial, and ethical imperatives for this integration and provide a roadmap for its implementation to ensure the rights of people are universally protected.

1. Introduction: The Convergence of Crises

For decades, corporate governance has treated environmental compliance and social responsibility as separate silos. An environmental impact assessment might evaluate pollution levels, while a human rights policy might address labor conditions, rarely connecting the two. This fragmented approach is obsolete.

The recognition by the UN General Assembly in 2022 of the human right to a clean, healthy, and sustainable environment has created a new legal and normative reality. Environmental degradation is now unequivocally a human rights issue. When a company pollutes a river, it is not merely breaching an environmental permit; it is potentially violating the rights to water, health, food, and livelihood of downstream communities.

This paper explores the necessary convergence of EDD and HRDD into a unified due diligence process that protects the rights of people by addressing the root causes of harm.

2. The Inextricable Link: Environmental Harm and Human Rights Abuses

The connection between environmental damage and human rights violations is direct and undeniable:

• Pollution & Rights to Life and Health: Contamination of air, water, and soil leads to increased morbidity and mortality from respiratory illnesses, cancers, and waterborne diseases.
• Deforestation & Rights of Indigenous Peoples: Land clearing destroys ecosystems that indigenous communities depend on for their physical and cultural survival, violating the right to Free, Prior, and Informed Consent (FPIC).
• Water Scarcity & Rights to Water and Food: Over-extraction or pollution of water resources by industry compromises access to safe drinking water and undermines agricultural livelihoods.
• Climate Change & a Spectrum of Rights: The impacts of climate change—including extreme weather, sea-level rise, and desertification—threaten the rights to life, health, housing, food, and self-determination on a massive scale.

Therefore, environmental due diligence is a core component of human rights protection. You cannot effectively conduct one without the other.

3. The Required Rights of People: A Framework for Protection

In the context of business activity, the “Rights of People” that must be respected are not abstract, but specific and actionable. These rights are held by rights-holders (communities, workers, indigenous peoples) and impose duties on duty-bearers (states and businesses).

The core required rights include:

1. The Right to a Clean, Healthy, and Sustainable Environment: The foundational, substantive right.
2. The Right to Information: Access to transparent, accessible, and timely information about projects and their potential impacts.
3. The Right to Public Participation: Meaningful engagement in decision-making processes that affect them, beyond mere consultation.
4. The Right to Free, Prior, and Informed Consent (FPIC): A specific right for Indigenous Peoples regarding projects on their traditional lands.
5. The Right to an Effective Remedy: Access to judicial and non-judicial mechanisms for redress when harms occur.

4. The Mandatory Process: Human Rights & Environmental Due Diligence (HREDD)

The operationalization of these rights is achieved through the HREDD process, as outlined in the UN Guiding Principles on Business and Human Rights and codified in emerging legislation. This is a continuous, six-step cycle:

Step 1: Identify & Assess

• Action: Map the entire value chain to pinpoint where operations and relationships may cause or contribute to adverse environmental and human rights impacts.
• Tool: Integrated Environmental & Human Rights Impact Assessments (ESHIAs), stakeholder engagement.

Step 2: Prevent & Mitigate

• Action: Integrate findings into policies and management systems. Develop and implement action plans to avoid, cease, or minimize identified impacts.
• Tool: Changing operational processes, investing in cleaner technology, contractual clauses with suppliers.

Step 3: Track Effectiveness

• Action: Monitor the performance of mitigation measures through key environmental and social indicators.
• Tool: KPIs on water quality, emissions, grievance data, community health metrics.

Step 4: Communicate

• Action: Be transparent about how impacts are addressed. Report publicly on policies, findings, and performance.
• Tool: Annual sustainability reports, public disclosure of ESHIAs.

Step 5: Provide Remediation

• Action: Establish or participate in mechanisms to enable remediation for any adverse impacts that occur.
• Tool: Operational-level grievance mechanisms, participation in mediation, payment of compensation.

Step 6: Embed & Integrate

• Action: Weave the HREDD process throughout corporate governance, from the boardroom to procurement.
• Tool: Board-level oversight, senior management accountability, staff training.

5. The Regulatory Landscape: From Voluntary to Mandatory

The global landscape is shifting rapidly from voluntary corporate social responsibility to legally enforceable obligations.

• Pioneering Legislation:
  • France’s Duty of Vigilance Law (2017): Requires large companies to publish a vigilance plan to prevent severe human rights and environmental harms.
  • Germany’s Supply Chain Due Diligence Act (2023): Mandates human rights and environmental risk management across corporate supply chains.
  • EU’s Corporate Sustainability Due Diligence Directive (CSDDD) (2024): A landmark directive that will require large EU companies to conduct due diligence on their environmental and human rights impacts, with civil liability for damages.
• The Legal Implications: These laws create a duty of care for companies. Failure to conduct adequate due diligence can result in:
  • Administrative Penalties: Significant fines.
  • Civil Liability: Lawsuits for damages brought by affected parties in the company’s home country.
  • Reputational Damage & Market Exclusion.

6. Case Study: The Ok Tedi Mining Disaster

Background: The Ok Tedi mine in Papua New Guinea, operated by a consortium led by BHP, deliberately dumped billions of tons of mining waste into the Ok Tedi River system after a tailings dam failure.

HREDD Failures:

• Failure to Mitigate: The decision to operate without a waste containment system was a catastrophic failure of the “prevent and mitigate” step.
• Human Rights Impacts: The resulting pollution destroyed fisheries and flooded villages, violating the rights to health, food, water, and culture of 50,000 Indigenous people.
• Long Remediation Struggle: Decades of litigation in BHP’s home country of Australia were required to secure limited compensation, highlighting the high cost of failed prevention.

Lesson: Ok Tedi serves as a stark warning of the consequences of separating environmental management from human rights accountability and underscores why mandatory HREDD is essential.

7. Challenges and Recommendations

Challenges:

• Complexity of Global Value Chains: Tracing impacts to the raw material source.
• Capacity Gaps: Especially for Small and Medium-sized Enterprises (SMEs).
• Inconsistent Enforcement: Varying standards and capacities of host states.
• Corporate Obfuscation: Using corporate structure to distance parent companies from liability.

Recommendations:

1. For Governments: Accelerate the adoption and strong implementation of mandatory HREDD laws, aligned with the EU CSDDD. Ensure robust enforcement and access to justice for victims.
2. For Businesses: Proactively implement the HREDD framework now, beyond legal compliance. Engage meaningfully with stakeholders and integrate findings into core strategy and governance.
3. For Investors & Financial Institutions: Make HREDD performance a core component of investment and lending decisions, using leverage to drive corporate accountability.
4. For Civil Society: Continue to act as watchdogs, support affected communities in using grievance mechanisms, and advocate for stronger laws and enforcement.

8. Conclusion

The integration of Human Rights and Environmental Due Diligence is no longer a theoretical ideal but a practical and legal imperative. The right to a healthy environment cannot be protected without holding economic actors accountable for their environmental impacts. The emerging global framework of mandatory HREDD provides the necessary tool to bridge this gap, transforming the rights of people from aspirational goals into legally enforceable claims. By adopting a proactive, integrated, and transparent due diligence process, businesses can not only manage risk and ensure compliance but also become leaders in building a more just and sustainable global economy.

Industrial Application of Environmental Due Diligence and Human Rights

From Silos to Integrated Risk Management

Industrially, this means moving from treating environmental, social, and human rights issues as separate compliance boxes to check, and instead integrating them into a unified Enterprise Risk Management framework. The goal is to identify and mitigate risks that could disrupt operations, supply chains, finance, and reputation.

Sector-Specific Industrial Applications

1. Extractive Industries (Mining, Oil & Gas)

This sector faces the most direct and intense scrutiny due to its large-scale environmental footprint and interaction with local communities.

• Application in Practice:
  • Pre-Exploration Phase: Conducting rigorous Environmental and Social Impact Assessments (ESIAs) that include baseline studies on human rights, health, and livelihoods. Free, Prior, and Informed Consent (FPIC) processes with Indigenous Peoples are initiated here, before any ground is broken.
  • Operational Phase:
    • Water Management: Implementing closed-loop water systems to prevent contamination of local water sources, directly protecting the right to water and health of downstream communities.
    • Tailings & Waste Management: Adhering to the Global Industry Standard on Tailings Management to prevent catastrophic failures like the Brumadinho dam collapse, which is a direct application of the duty to protect the right to life and a healthy environment.
    • Local Content & Livelihoods: Creating programs to employ and train local community members and procure from local businesses to mitigate economic displacement and respect the right to an adequate standard of living.
  • Closure & Remediation Phase: Planning and financing for post-closure land rehabilitation and long-term water monitoring, fulfilling the “remediation” aspect of due diligence.

2. Manufacturing & Apparel

This sector’s primary risks lie in its complex, multi-tiered global supply chains.

• Application in Practice:
  • Supply Chain Mapping & Transparency: Using digital tools and on-the-ground audits to map the entire supply chain down to the raw material level (e.g., from the garment factory to the cotton farm).
  • Supplier Code of Conduct & Capacity Building: Contractually obligating suppliers to adhere to environmental (e.g., chemical management, wastewater treatment) and human rights (e.g., no child or forced labor, safe working conditions) standards. Providing training and support to help them comply.
  • Factory Audits & Environmental Monitoring: Conducting unannounced audits that check both labor conditions (working hours, wages) and environmental performance (air emissions, dye effluent treatment). This protects both worker rights and the right to a healthy environment for surrounding communities.
  • Circular Economy Initiatives: Designing products for disassembly, using recycled materials, and managing product take-back programs to minimize environmental impacts throughout the product lifecycle.

3. Agriculture & Forestry

This sector is central to deforestation, water use, and land rights issues.

• Application in Practice:
  • No-Deforestation & No-Exploitation Commitments (NDPE): Major agribusinesses publicly commit to eliminating deforestation and land rights abuses from their supply chains. This is a direct application of protecting the right to a healthy environment and the land rights of local communities.
  • Geospatial Monitoring: Using satellite imagery and GPS to monitor sourcing areas for illegal deforestation or encroachment on protected lands or indigenous territories.
  • Land Tenure Verification: Before sourcing from a new area, conducting due diligence to ensure the land was not acquired through forced evictions or without the FPIC of local communities.
  • Sustainable Water Stewardship: Implementing water-efficient irrigation and protecting watersheds to ensure local communities retain access to water.

4. Renewable Energy & Infrastructure

While part of the climate solution, these projects can have significant social and environmental footprints.

• Application in Practice:
  • Strategic Siting: Using spatial data to avoid building large-scale solar farms or wind projects on lands with high biodiversity value or that are culturally significant to Indigenous Peoples.
  • Community Benefit Sharing: Going beyond simple compensation to ensure local communities have an ownership stake or receive direct benefits (e.g., reduced electricity costs, community development funds) from the project.
  • Responsible Mineral Sourcing: Conducting due diligence on the supply chain for critical minerals like cobalt, lithium, and copper to ensure they are not linked to human rights abuses in mines. This connects the “green” energy sector to its extractive roots.

5. Finance & Banking

This sector is an enabler and risk-bearer for all others, applying due diligence indirectly but powerfully.

• Application in Practice:
  • ESG Integration & Exclusion Lists: Banks and investors screen potential investments and clients against environmental and social criteria. They may exclude companies involved in severe abuses (e.g., coal mining, child labor).
  • Due Diligence as a Condition for Finance: Requiring clients to demonstrate robust HREDD processes as a precondition for loans, insurance, or investment. This is a powerful market lever.
  • Project Finance: For large projects, lenders apply the Equator Principles, a risk management framework for determining, assessing, and managing environmental and social risk. This mandates ESIAs, stakeholder engagement, and grievance mechanisms.

Cross-Industrial Tools & Technologies for Application

• Digital Platforms: For supply chain mapping, tracking supplier compliance, and managing grievance mechanisms.
• Satellite & Geospatial Analysis: For monitoring deforestation, water usage, and land use changes in near real-time.
• Blockchain: For creating tamper-proof records in supply chains, such as verifying the conflict-free status of minerals or the sustainable sourcing of commodities.
• Stakeholder Engagement Software: To systematically manage and document consultations with communities and other stakeholders.

The Business Case for Industrial Application

Companies do not undertake this complex process solely for ethical reasons. The industrial business case is clear:

1. License to Operate: Maintains social acceptance from local communities and regulators.
2. Risk Mitigation: Prevents costly operational disruptions, project delays, lawsuits, and reputational damage.
3. Access to Capital: Investors increasingly mandate robust ESG and due diligence performance.
4. Supply Chain Resilience: Identifying and addressing vulnerabilities in the supply chain makes it more robust.
5. Competitive Advantage: Becoming a supplier of choice for leading brands that demand sustainable and ethical practices.

Conclusion

The industrial application of the Rights of People through Environmental and Human Rights Due Diligence represents a fundamental shift in how modern corporations operate. It is a strategic process that integrates the protection of human rights and the environment directly into core business functions—from the C-suite to the supply chain. For industries, this is not about charity; it is about building a sustainable, resilient, and profitable business model for the 21st century, in alignment with a new global standard of corporate accountability.