Overview
Four case studies show how you can answer the questions of the appropriateness questionnaire. The examples cover human rights (child and forced labour), labour rights (occupational safety, minimum wage) and environmental rights (mercury). The companies are fictitious. The article Significance of the appropriateness assessment explains the basics of the individual criteria.
Note: The questions correspond to Tacto's standard configuration of the appropriateness questionnaire (4 questions: severity, probability of occurrence, supply chain tier, contribution to causation). Your Evaluation template may differ.
Case studies: human rights
Situation 1: Risk of child labour and forced labour in the supply chain
Company: "ElectroTech International", a large German company that manufactures and sells electronic devices worldwide.
Scenario: ElectroTech International sources rare earths and other raw materials from the Democratic Republic of the Congo – a country with rich mineral deposits but also problematic working conditions, including child and forced labour. The company has not identified any direct violations so far, but the regional conditions create a high risk potential.
How should the potential severity of a violation be assessed?
High. Child and forced labour have profound and long-lasting effects on the health, safety and well-being of those affected and their communities. Medium or Low do not apply here, as child and forced labour in raw material extraction are generally considered serious human rights violations.
How likely is it that a risk at the supplier will result in a violation?
Likely, as the region is known for human rights violations and the company has not yet been able to demonstrate comprehensive control and prevention measures. If ElectroTech International has already introduced risk mitigation measures, Possible is also justifiable. Unlikely does not apply, as the risk in this scenario is inherently high.
At what tier of the supply chain does the potential risk arise?
Tier 3 – Indirect is very likely, as risks in rare earth mining often arise at this level, where the company has little influence and visibility. Tier 2 – Indirect is also likely, as raw material suppliers from the Congo are usually located at tier 2 or lower. Tier 1 – Direct may be relevant if the main suppliers source raw materials directly from high-risk areas.
To what extent do my company's actions contribute to human rights violations?
Limited contribution applies if the company has implemented risk mitigation measures that do not cover all risks – for example if ethical sourcing practices have been introduced but are not yet fully effective. Active contribution may apply if no adequate due diligence is carried out and practices that favour human rights violations are thus indirectly supported. No contribution is unlikely to apply, as sourcing from high-risk areas supports demand for these raw materials.
Situation 2: Risk of forced labour in the supply chain
Company: "TechGadget Innovations", a medium-sized German company that manufactures specialised electronic components.
Scenario: TechGadget Innovations sources rare materials and components from a supplier in China. There is no direct evidence of forced labour, but several independent reports and media point to forced labour in some regions of China. There is therefore a medium risk that some suppliers are involved in such practices.
How should the potential severity of a violation be assessed?
High if extensive or systematic forced labour is found at the suppliers. Medium if forced labour occurs to a limited extent or in less severe forms. Low does not apply, as forced labour is always a serious human rights violation.
How likely is it that a risk at the supplier will result in a violation?
Possible: there is no direct evidence, but regional conditions and reports indicate a risk. Likely does not apply, as no concrete cases have been identified in the direct supply chain so far. Unlikely does not apply either, as reports have already established the risk.
At what tier of the supply chain does the potential risk arise?
Tier 3 – Indirect is very likely, especially for raw materials or basic components. Tier 2 – Indirect is also likely, as forced labour often occurs at lower levels of the supply chain. Tier 1 – Direct is possible if the main suppliers are directly affected.
To what extent do my company's actions contribute to human rights violations?
Limited contribution is likely, as the company could contribute indirectly by sourcing raw materials from these areas without adequate checks. Active contribution only applies if it is proven that the company knowingly sources from suppliers using forced labour. No contribution does not apply, as the sourcing region is known for forced labour.
Case studies: labour rights
Situation 1: Occupational safety and minimum wages in the supply chain
Company: "QualityApparel GmbH", a German fashion and clothing company operating worldwide.
Scenario: QualityApparel sources clothing from various suppliers in Bangladesh. The company has established guidelines for fair working conditions and wages, but there are reports of inadequate occupational safety and insufficient wages in the country's textile industry. There is a medium risk that some suppliers do not pay an appropriate minimum wage and do not comply with occupational safety standards.
How should the potential severity of a violation be assessed?
Medium, especially if the violations are not widespread but still significantly affect the workers concerned. High if the violations are widespread and systematic. Low does not apply, as violations of occupational safety and minimum wage are serious violations of labour rights.
How likely is it that a risk at the supplier will result in a violation?
Possible, as some suppliers may not fully implement the company's guidelines in practice. Likely if there are concrete indications of systematic violations at main suppliers. Unlikely does not apply, as the risk is known in the textile industry in Bangladesh.
At what tier of the supply chain does the potential risk arise?
Tier 1 – Direct is likely, as the main suppliers could be directly affected. Tier 2 – Indirect is possible if the problems occur at further levels of the supply chain. Tier 3 – Indirect is also possible but less likely, as the company usually has little visibility into this level.
To what extent do my company's actions contribute to labour rights violations?
Limited contribution is very likely, as the company could contribute indirectly by sourcing from suppliers that do not comply with all standards. Active contribution only applies if it is proven that the company knowingly sources from suppliers that violate these standards. No contribution is rather unlikely, as the company operates in a high-risk sector.
Case studies: environmental rights
Situation 1: Mercury pollution in metal processing
Company: "EcoMetal Solutions GmbH", a German company specialising in the extraction and processing of metals, including from areas with a high environmental risk.
Scenario: EcoMetal Solutions operates mines and processing plants in Southeast Asia, a region with rich metal deposits but also pollution problems. There is a high risk that mercury is used in metal processing – a direct violation of the Minamata Convention. Inadequate treatment of mercury waste could also violate the Convention.
How should the potential severity of a violation be assessed?
High, as even small amounts of mercury can have serious and long-term environmental effects. Medium is possible if the amount used is limited. Low does not apply, as mercury is highly toxic and can cause significant environmental and health damage.
How likely is it that a risk at the supplier will result in a violation?
Likely, as cases of mercury pollution are already known in the region. Possible is also justifiable, especially if the company has not implemented strict environmental protection measures. Unlikely does not apply, as the use of mercury in some processing operations is known.
At what tier of the supply chain does the potential risk arise?
Tier 1 – Direct is very likely, as the company is directly involved in mining and processing. Tier 2 – Indirect is possible if suppliers are also involved in high-risk processes. Tier 3 – Indirect is also possible, especially for raw material suppliers.
To what extent do my company's actions contribute to environmental violations?
Active contribution is most likely if EcoMetal Solutions uses mercury in its processes or disposes of it inadequately. Limited contribution is possible if the company implements measures to reduce mercury use. No contribution is rather unlikely, as the company operates in a sector with a known mercury risk.