Overview
This article explains the principle of appropriateness under the LkSG and how to answer the questions of the appropriateness assessment in the Tacto risk analysis.
The assessment is based on the severity, probability and irreversibility of violations and on your company's contribution to causation and influence.
For examples, see Appropriateness assessment: case studies.
Note: The questions and answer options correspond to Tacto's standard configuration (four questions on severity, probability of occurrence, contribution to causation and influence). Your Evaluation template may differ.
Definition of appropriateness
The principle of appropriateness (Section 3 (2) LkSG) takes into account the different resources, activities and supply chains of companies.
Companies must fulfil their due diligence obligations appropriately in order to prevent or minimise human rights and environmental risks and to end violations or reduce their extent.
Each company has discretion and room for manoeuvre. The type, sequence and intensity of measures depend on its specific situation.
This allows risks to be addressed effectively without demanding anything unreasonable of companies.
Dimensions of appropriateness
Severity
The severity of a violation is measured by the number of people affected, the size of the environmental area affected and the intensity or depth of the violation.
How should the potential severity of a violation be assessed?
Low: The violation affects only a few people or a small share of the workforce, no significant part of the environment and/or is of low intensity – for example temporary and easily reversible, without long-term effects on health, well-being or the environment.
Medium: The violation affects a larger number of people or a significant part of the environment and/or is clearly noticeable. It may last longer or significantly impair health, safety, well-being or the environment, but may still be reversible.
High: The violation affects many people or a large environmental area and/or is very intense. Forced labour, other forms of involuntary labour and the worst forms of child labour are always considered highly severe. Irreversible effects with long-term or permanent damage also fall into this category.
Probability of occurrence
This takes into account the history of the risk, implemented preventive measures and specific risks of countries, industries and product groups.
How likely is it that a risk at the supplier will result in a violation?
Unlikely: The risk has never led to a violation in the past, effective preventive measures reduce it significantly, or the country, industry or product group generally has a low risk.
Possible: Medium probability – for example if there have been isolated incidents, preventive measures are in place but not fully effective, or the risk is known in the industry, country or product group but does not regularly lead to violations.
Likely: The risk has frequently led to violations in the past, there are no or insufficient preventive measures, or the country, industry or product group-specific risks are known to often lead to violations. A supplier's known poor performance increases the probability; effective preventive measures reduce it.
Contribution to causation
The contribution to causation describes how strongly your company contributes to violations through its own actions and what options it has to prevent or minimise them.
To what extent do my company's actions contribute to human rights violations?
No contribution: Your company has no significant influence on actions of third parties that could lead to violations, for example because strict ethical guidelines and control mechanisms ensure that its own business practices neither directly nor indirectly contribute to violations.
Limited contribution: Your company has some influence on the practices of its business partners, but not enough to prevent violations completely – for example because preventive measures have been implemented but are not comprehensive enough.
Active contribution: Your company directly or indirectly enables or promotes violations through its own business decisions or practices.
Influence
Influence depends on the tier of the supply chain at which the risk arises and on how strong your market position is.
At what tier of the supply chain does the potential risk arise?
Tier 1 – Direct: The risk arises directly at your main suppliers. You are in direct contact and usually have more influence and control.
Tier 2 – Indirect: The risk arises at your main suppliers' suppliers. These relationships are more indirect and less visible; you have no direct influence.
Tier 3 – Indirect: The risk arises even further away, often at raw material suppliers or early stages of the supply chain. It is usually difficult to identify and control.