Yara has made a commitment to respecting internationally recognized human and labor rights throughout our own operations, as well as in our supply chain. Respecting human rights is fundamental to sound risk management and Yara’s value creation. We value our good relations with employees and their organizations and engage with them frequently.
We support the United Nations Global Compact, the United Nations Guiding Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprises, the International Bill of Human Rights, and the core conventions of the International Labor Organization (ILO). In addition, we perform human rights due diligence in our supply chain in compliance with the Norwegian Transparency Act (Åpenhetsloven).
Human rights management, own operations:
By 2025, conduct Human Rights Impact Assessments (HRIAs) and address findings in all countries where we consider that our operations have the highest impact on human rights, focusing on Brazil in 2021, and selected operations in Africa and Asia in 2022.
Human rights management, supply chain:
Respect the rights of people in the supply chain by continuing our human rights due diligence activities, including audits and training, directed at high risk business partners.
By 2025, establish living wage benchmarks and conduct gap analyses for all our countries of operation.
Yara sources a wide variety of goods and services from roughly 40,000 suppliers worldwide. Sourcing of natural gas and nutrients are important elements of our purchases and operating expenses. We have developed strong relationships with key suppliers to ensure continuity and profitability in our business. Managing compliance in the supply chain has long been a priority, and in 2021, we initiated work to further align our procurement and supplier management policies and processes with the recommendations from the UN and OECD. This work continued in 2022 as we prepare for the Norwegian Transparency Act (Åpenhetsloven). The figure below outlines our key policies, procedures, and intentions for the management of sustainability, human rights and compliance in the supply chain.
One of Yara’s goals is to develop relationships with business partners that share similar corporate values as Yara and conduct their business in an ethical and compliant manner. The Code of Conduct for Yara’s Business Partners (BPCoC) is the Yara policy that outlines the legal obligations and the integrity standards Yara expects its business partners to uphold. The BPCoC considers the same internationally recognized and endorsed standards for human rights, business ethics, and labor conditions as our Code of Conduct.
Integrity Due Diligence (IDD) is the procedure for ensuring and monitoring the integrity of potential, new, and existing business partners. Yara had more than 30,000 active suppliers in 2021. Approximately 13% of the suppliers had completed the Integrity Due Diligence (IDD) self-assessment questionnaire. The purpose of the IDD process is not to reject business partners, but to identify integrity risks and to mitigate these to safeguard Yara’s interests. If adverse responses are identified in the IDD self-assessment questionnaire, we initiate a dialogue with the supplier, and are committed to influencing them to uphold the same integrity standards as at Yara. Fewer than 1% of our business partners are rejected annually.
As part of the IDD Procedure, we continuously monitor compliance in our supply chain by screening suppliers against sanctions, watchlists, and compliance databases. On a risk-basis, certain suppliers are selected for additional follow-up, including in-depth due diligence work, training and other communication efforts.
The policy describes how we want to cooperate with our suppliers to create transparency in our suppliers’ business sustainability performance and how to improve their performance, and with that our own performance, where required. This policy guides our global Procurement organization and the implementation of a Sustainable Procurement Program at Yara.
The objective of the Supplier Compliance Management Process is to describe what the minimum requirements for supplier pre-qualification, qualification, and supplier compliance monitoring are, including supplier auditing, following a risk-based approach. This is a global process that allows cross-functional Procurement teams to cover increasing internal and external due diligence and reporting requirements, such as the Norwegian Transparency Act (Åpenhetsloven). The process document is currently being developed and aiming to start the implementation during the 2nd half of 2022.
We conduct supplier audits and assessments in sectors in which we have identified risks through, for example, our Integrity Due Diligence process, human rights impact assessments, reports of severe accidents, or previous audit findings. In 2021, we ran a risk-based audit program related to road transport. Risk-based audits include performance evaluation of the carriers prior to audit.
A total of 21 audits were conducted across Europe. These audits cover health and safety performance, environmental policies, human rights, and operational issues. Non-conformities and observations are recorded and followed up with the companies.
Conducting targeted human rights impact assessments (HRIAs) is an integral part of meeting our due diligence obligations. HRIAs are performed by independent external subject matter experts in locations where our operations have the highest impact on human rights, and where our leverage to remedy is considered highest. Findings from HRIAs are presented to the Group Executive Board and the Board of Directors. Mitigating actions remain a local management responsibility, and the Ethics and Compliance Department monitors implementation and reports on progress.
Each human rights impact assessment (HRIA) we have conducted to date has proven highly valuable. They help us, in a strategic and systematic way, to evaluate how our human rights policies are implemented on the ground. The assessments provide awareness at a country level on what human rights risks mean in a Yara context and develop competencies and skills amongst our employees to identify and address potential risks. It is also a way to manage our stakeholder relations and increase the knowledge of rights-holders on their rights.
Each year, we update our global human rights risk assessment and rank our countries of operation, as well as countries from which we source raw materials, in terms of human rights risk exposure. This guides our focus on where to conduct more targeted human rights impact assessments (HRIA). In addition, HRIA findings form our understanding of what Yara’s main risks to people’s human rights are, as presented in our Code of Conduct. We recognize that this landscape might change, and that we continuously need to monitor the potential impacts from our operations and supply chain.
The 2021 Yara human rights risk assessment identified 19 high-risk countries, up from 18 in 2020. All high and medium-risk countries are monitored through our Compliance Program and specific action plans are developed to mitigate identified impacts. Previous human rights impact assessments (HRIA) have identified risk of negative impact from our operations in connection with contracted labor performing services for Yara, especially where manual labor is combined with heat exposure. Mitigating actions are in place to address these issues locally, and in cases where findings are relevant to Yara globally, actions have been initiated to implement or develop new policies to lift our standards in all locations. One example is the global policy on Physical Requirements to the Work Environment, which was introduced in 2021. It is relevant for all employees working on our sites, including contracted workers. In 2021, we also initiated a project to assure living wages for all Yara employees globally.
In 2021 we conducted HRIA’s on our main production sites in Brazil, including selected fertilizer blending units and bagging warehouses. The main concerns identified were related to:
Addressing the findings related to child and adolescent exploitation has priority. This is one of the major social issues identified in the local communities surrounding some of Yara’s operations. These negative impacts arise from the influx of labor at ports and in industrial areas, including road freight activities possibly linked to Yara’s activities. A Yara multi-disciplinary team has been established to engage in dialogue with key stakeholders for the prevention of sexual exploitation of children and adolescents and to develop a country-level strategic plan to help identify, prevent, and address this risk in connection to our operations. Stakeholders involved include local communities, NGOs, local service stations, road freight users, transportation companies, and drivers’ unions.