Insurance Companies' Responses to Human Rights Abuses in the Extractive Industry
Publisher: Profundo
Author(s): Juliette Laplane, Stefanie Geurts, and Lennart van Loenen
Date: 2021
Topics: Extractive Resources, Governance
The extractives sector is a risk sector for involvement in human rights abuses. Extractives industries projects and activities can have several adverse impacts such as: resettlement of communities without adequate consultation and compensation, negative impacts on the livelihoods of local communities and their access to water, labour rights violations and major safety accidents. Companies in this sector should have ongoing due diligence processes in place to prevent, mitigate, and remediate human rights abuses. International standards such as the United Nations Guiding Principles on Business and Human Rights state that all business enterprises regardless of their size, sector, location, ownership and structure, have the responsibility to respect human rights.
In the context of institutional investments, this means that investors’ responsibility to respect human rights encompasses not only their own operations (with their employees, suppliers, clients) but also the actual or potential impacts they are connected to through their investments. Investors should seek to prevent and mitigate human rights abuses of their investee companies and also encourage them to provide remedy where they have caused or contributed to the abuses. These responsibilities in practice take shape in processes of engagement with the investees.