Navigating human rights challenges in global supply chains: strategies for long-term sustainability
GoodBlog | read time: 9 min
Published: 18 July 2025
With around 70% of international trade flowing through global value chains – where services, raw materials, parts, and components cross borders multiple times – businesses have become increasingly reliant on intricate supply networks spanning continents. While globalisation on this scale has undoubtedly led to enhanced efficiency and profitability, it has also led to a loss of oversight and control, often resulting in damage not just to people and planet but also to the companies themselves.
Much of this is driven by the fact that these multi-layered supply chains extend through countries with vastly different regulatory standards, environmental protections, and social conditions, making it hard for companies to impose consistent standards. As a result, we have seen numerous high-profile scandals exposing the stark reality, hidden deep within global supply chains, of rights violations and environmental degradation, eroding trust and damaging reputations.
In recent years, however, scrutiny from regulators, investors, consumers and civil society has intensified, resulting in the development of international standards defining corporate responsibility to protect human rights and the emergence of legal requirements to conduct human rights due diligence.
Both the United Nations with its Guiding Principles on Business and Human Rights and the OECD through its Guidelines for Multinational Enterprises find that companies have a duty to respect human rights wherever they operate. As a result, they should conduct risk-based human rights due diligence to identify, prevent, mitigate, and account for their actual and potential adverse human rights impacts.
Following the publication of the UNGPs, governments have attempted to codify these responsibilities into national law. European countries initially led the way with the UK Modern Slavery Act, France’s Duty of Vigilance Law and Norway’s Transparency Act. We have also seen the enforcement of Section 307 of the 1930 Tariff Act—further reinforced by the more stringent Uyghur Forced Labor Prevention Act targeting goods from Xinjiang—and the upcoming European Forced Labour Regulation, all requiring companies to scrutinise their supply chains more rigorously to avoid having their goods banned on certain markets. South Korea has also introduced to its National Assembly a Corporate Human Rights and Environmental Due Diligence Bill introducing mandatory human rights and environmental due diligence, which would be the first law of its kind in Asia. Thailand is working on a similar bill and Japan is headed in that direction too.
The EU Corporate Sustainability Due Diligence Directive (CSDDD) set out to require thousands of large companies operating in, or trading with, the EU to conduct human rights and environmental due diligence across their global value chains. However, this is currently subject to review. Despite the EU Omnibus Package which proposes to narrow these due diligence requirements considerably, many companies recognise that it is not possible to “omnibus the risk” and are continuing to protect themselves, and those within their supply chains, by conducting risk-based human rights due diligence across their operations.
Why the human cost of global disruptions make supply chain risk management essential
Beyond reputational risk and legal compliance, human rights due diligence has never been more of a strategic necessity. Today’s global disruptions, including geopolitical tension, climate disruption, and economic volatility, all affect the lives and livelihoods of vulnerable workers in global supply chains. When workers are displaced, endangered, or forced into precarious conditions, the result is a breakdown in supply chain reliability and ultimately, operational continuity.
In sectors like agriculture and construction, extreme heat is making it unsafe for workers to operate for extended hours, while storms and flooding frequently cut off access to work sites—eroding productivity and disrupting timelines. Climate-related disasters are also displacing workers, destroying homes and work sites, and damaging transport infrastructure. This loss of stability reduces productivity and undermines the long-term availability of skilled labour in affected regions.
Meanwhile, disruptions to aid programmes, surging inflation and food insecurity are eroding living standards in many sourcing regions. These pressures leave workers, many of whom already face low wages and poor working conditions, struggling to meet basic needs, increasing attrition and weakening supplier resilience.
In parallel, armed conflict and political instability are leading to the sudden closure of sourcing regions, the destruction of critical infrastructure, and the widespread displacement of people — all of which make it difficult or impossible for suppliers to maintain workforce continuity and fulfil contracts. In some cases, companies are forced to reroute supply chains or halt operations entirely, incurring significant financial and logistical costs and leaving workers at risk of violence or exploitation.
Global disruptions have a direct impact on people working within supply chains. These human consequences are not only humanitarian crises—they also pose serious business risks. When workers are unable to work safely, consistently, or legally, the entire supply chain becomes vulnerable. Companies that fail to recognise the human dimension of supply chain risk will find themselves exposed to operational shocks they can no longer control. In this context, protecting people is not just the right thing to do—it’s the only way to ensure supply chain continuity and resilience. So what action should companies be taking?
Key steps for identifying and addressing human rights risks in your supply chain
To help companies navigate these complex challenges we have identified the key steps businesses need to take to effectively identify and address human rights risks in their supply chains.
Step 1: Identify where the activities in your supply chain are most likely to have a negative impact on people
Companies should start by mapping out the chain of activities needed to produce the goods and services they market – from the sourcing of raw materials to the delivery of the end product. This will involve examining how these different products or services are made and delivered, the types of activities involved, how raw materials are sourced and processed, and where each of these steps takes place.
Some sectors and activities are inherently linked to more severe impacts on people due to the nature of the work involved, so companies need a clear understanding of what these impacts are and how they might materialise across their supply chain. Labour-intensive sectors such as agriculture and waste picking for instance, are much more likely to result in human rights abuses due to their reliance on very low-skilled and often vulnerable workers around the world. Companies can focus their risk assessment efforts on those activities where the impact to people is likely to be most severe.
Importantly, when considering the impacts on people, it is crucial to include all potentially affected stakeholders, including not just the different groups of workers (employees, contracted and subcontracted workers, informal workers) but also local communities.
In addition, the presence of vulnerable groups within these stakeholders, such as children, migrant workers, women, Indigenous peoples, or informal workers, can deepen the severity and impact of rights abuses due to their limited ability to defend themselves or recover from harm. Understanding this risk factor adds to an organisation’s ability to identify where any adverse impacts on people might be the greatest.
Once the nature of the activities is understood, it will be important to evaluate the geographical context to assess whether this has a bearing on where the highest risks might occur. Countries or regions with weak rule of law, inadequate labour protections, corruption, or ongoing conflict tend to amplify human rights risks. In particular, companies should be alert to sourcing from Conflict-Affected and High-Risk Areas (CAHRAs), where the probability of serious abuses, such as forced labour, child labour, or violence, is significantly elevated, requiring heightened diligence.
By evaluating the risks, both from the nature of the activities and their geographical contexts, companies can identify where their most significant risks are concentrated and prioritise the actions needed to mitigate any adverse impacts from their activities. To align with the UNGPs, this risk evaluation step should focus exclusively on the risk to people, irrespective of any existing mitigation measures or business considerations such as volume, spend, or the strategic importance of the activity. If necessary, such considerations can be taken into account once the full nature of any actual and potential human rights impacts is understood.
Step 2: Prioritise action based on inherent risk
According to international guidance, a company must start by addressing the issues with the highest risk to people. This can be challenging for those businesses with limited resources and a large number of their suppliers or commodities associated with severe human rights risks.
However, it is worth remembering that businesses are not expected to solve all identified human rights simultaneously. A risk assessment therefore will allow companies to map out their risks according to severity and likelihood which will enable them to direct resources accordingly to address the greatest need.
Where companies source from complex supply chains with multiple high-risk segments, there will be additional criteria to be evaluated and these will need to be considered on a case-by-case basis to prioritise mitigation effectively. These factors do not determine whether a risk exists, but help decide where and how to act first, especially when resources are limited.
Step 3: Develop a roadmap for action
Once high-risk areas have been identified and prioritised, companies need to develop and implement a structured roadmap for action. This will guide the human rights programme by clearly defining the measures needed to address the risks.
An effective roadmap may include the following:
- In-depth assessments of priority risks, potentially involving targeted audits, worker interviews, human rights impact assessments or focused investigations
- Detailed supply chain mapping, especially in complex or opaque tiers, to trace each step of the high-risk product or service flow
- Collaborative dialogue with suppliers, aimed at building trust, improving transparency, and supporting responsible practices through capacity building to cascade responsibility for mitigating human rights risks across the supply chain
- Implementation of targeted projects to address abuses and remediate affected stakeholders
- Review of purchasing practices, including price setting, to limit the systemic causes of many abuses, such as low wages and short lead times
- Participation in sector-wide initiatives with peers to pool resources and exert higher leverage
- Raising awareness at board and senior management level to help embed human rights due diligence into the company’s business model and strategic decision making
- Training of key internal functions to facilitate the identification and mitigation of risks
The roadmap should also build on the company’s existing risk management systems and any pre-existing action plans related to supply chain human rights risks, reflecting any practical realities and including:
- The degree of leverage or control the company has over suppliers
- The maturity of suppliers’ own due diligence practices
- The capacity of internal teams, such as Compliance, Sustainability, and Procurement, to manage follow-up and support
- The availability of budget and resources to carry out investigations, supplier engagement, or capacity-building activities
A strong roadmap ensures that the company moves beyond risk identification to targeted, effective mitigation and prevention, prioritising the most severe risks to people while using its influence strategically.
How GoodCorporation can help
Increased supply chain complexity, heightened regulatory obligations, growing geo-political tensions and systemic disruptions mean that the need for companies to effectively identify and address human rights risks in their supply chains has never been more pressing. Yet, for businesses with complex supply chains spanning multiple regions, this can seem like a daunting task.
A risk-based approach to supply chain mapping enables companies to direct resources where harm is most likely and most severe. Such an approach helps companies build more resilient and adaptable supply chains. It also allows businesses to meet evolving legal obligations while protecting their brand, shareholder investment, and people on the ground.
Importantly, it positions companies as leaders, not laggards, in building sustainable, resilient supply chains fit for the future.
GoodCorporation has carried out in-depth risk mapping exercises and Human Rights Impact Assessments (HRIAs) for multiple clients across numerous sectors. We assist our clients in prioritising the identified risks, proposing how these can be addressed and building a multi-year strategic road map to direct resources and deliver implementation.
Drawing from our experience on the ground in the lowest tiers of supply chains, our risk-mapping methodology goes beyond first-tier suppliers enabling our clients to have a thorough and in-depth understanding of the human rights risks associated with their activities and how to mitigate them.
“GoodCorporation’s human rights risk-mapping exercise was extremely thorough and helpful to Subsea7. The GoodCorporation team has considerable knowledge and expertise in evaluating human rights risks across complex supply chains such as ours. Through this work we have been able to strengthen and improve our human rights programme to align our systems and processes with recognised best practice.”
Mike Brock, Senior Human Rights Manager at Subsea7
