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Blog | Thursday August 14, 2025
Developing Integrated Approaches to Human Rights, Climate, and Nature
Siloed operational frameworks, data issues, and limited guidance on how EU-wide sustainability regulations interact hinder effective human rights and environmental due diligence. BSR shares insights and emerging good practices for integrated approaches to human rights, climate, and nature.
Blog | Thursday August 14, 2025
Developing Integrated Approaches to Human Rights, Climate, and Nature
Preview
In July 2025, the International Court of Justice affirmed that all nations have a binding duty to protect the climate, recognizing a clean, healthy, and sustainable environment as a fundamental human right. It warned that inaction or harmful conduct—such as fossil fuel production and subsidies—may require reparations, including through ecosystem restoration and financial compensation. These obligations remedy both human welfare and biodiversity harms, underscoring the inseparable link between environmental protection and human rights.
This decision, alongside ambitious regulations like the Corporate Sustainability Due Diligence Directive (CSDDD) and Corporate Sustainability Reporting Directive (CSRD) and rising litigation on climate- and nature-related human rights impacts, reflects growing recognition of the need to address the triple planetary crisis of climate change, pollution, and biodiversity loss while upholding human rights.
For business, this is an opportunity to integrate environmental and social strategies, as impacts on climate, deforestation, land degradation, and pollution are often tied to human rights harms—and vice versa. And while business efforts to mitigate climate change are urgently needed, climate action that ignores people can lead to job dislocation and community displacement.
Many companies, however, struggle with effective human rights and environmental due diligence (HREDD) due to fragmented regulations, siloed internal systems, and limited guidance, slowing progress toward integrated, impactful action.
Key Challenges
Siloed Operational Frameworks
The OECD Guidelines for Multinational Enterprises’ risk-based due diligence approach sets consistent expectations for businesses seeking to address their impacts on climate, nature, and human rights. However, this approach is inconsistently reflected across operational frameworks in these fields. These operational frameworks are intended to guide impact identification, assessment, and action on internationally recognized human rights standards and global environmental goals and targets (e.g., UN Guiding Principles on Business and Human Rights, Science-Based Targets initiative, Science-Based Targets for Nature), hindering integrated HREDD. Differences in terminology, methodologies, and stakeholder expectations of each persist, making it harder for teams within companies to coordinate. Some frameworks prioritize outward impact management, others financial materiality, and a few integrate both, complicating alignment.
Different Data Sets, Varying Methodologies
One challenge for companies in delivering effective HREDD lies in the data. Environmental assessments typically rely on quantitative metrics, e.g., carbon emissions, energy use, or water consumption. Human rights assessments are largely qualitative, requiring stakeholder input, contextual nuance, and narrative disclosure. The ease of quantifying environmental data and performance can lead companies to prioritize environmental over social initiatives.
Integrating qualitative and quantitative data is essential for a complete risk picture. Scientific indicators provide critical metrics, but combining them with local knowledge and cultural context can uncover issues that numbers alone miss. This approach strengthens decision-making when data are incomplete and helps identify cumulative impacts where different risks intersect and amplify each other. For institutional investors (or universal owners, such as pension funds and sovereign wealth funds), this is critical, as systemic risks from the interaction between climate change, biodiversity loss, and inequality pose a far greater threat to portfolios than the performance of any single company.
Some sectors, like oil, gas, and mining, have incorporated social considerations into Environmental Impact Assessments (EIAs), producing Environmental and Social Impact Assessments (ESIAs). However, the primary purpose of such assessments is not to assess a company’s broader impacts against internationally agreed environmental conventions. Rather, ESIAs are project-specific tools designed to identify, predict, evaluate, and mitigate potential environmental and social impacts before a project proceeds and in compliance with domestic laws and permitting requirements, which may differ from international standards.
Limited Guidance on Interaction and Synergies between EU-Wide Sustainability Laws
The EU’s sustainability laws were developed by different Commission bodies on separate timelines, with limited guidance on how requirements are meant to work together. This raises practical questions, including:
- How should high-level due diligence under CSDDD support compliance with more prescriptive regulation, e.g., EU Deforestation Regulation (EUDR), EU Batteries Regulation?
- Can EUDR risk assessments be leveraged to support compliance with other requirements, e.g., EU Forced Labour Regulation?
- How can integrated HREDD, including in the context of climate transition plans under CSDDD, inform CSRD reporting on intersecting environmental and social impacts?
These and other factors can contribute to siloed compliance approaches, where legal teams may lead on CSDDD; environment, health, and safety departments on environmental impacts; and finance teams on non-financial reporting of HREDD under CSRD. While dedicated teams, systems, and resources can be valuable for managing business impacts on people and the environment, working in silos can create fragmented cultures, poor information sharing, and duplicative processes that fail to build on existing, well-established approaches. This can undermine a coherent strategic direction and weaken leadership buy-in.
The Path Forward: Building Bridges Across Fields and Business Functions
An integrated approach to climate, nature, and human rights is essential to long-term business value. While geopolitical tensions may slow regulatory momentum, expectations are rising for companies to holistically address their impact on people and the planet.
Some companies are already moving in this direction. For example, Unilever’s People and Nature Policy connects deforestation, regenerative agriculture, and human rights, including land rights and the protection of human rights defenders. A food and beverage company is tackling emissions, waste and pollution, and human rights by adopting a circular economy model developed with local governments to support and protect informal waste workers.
How BSR Can Help
To support companies, BSR is undertaking initiatives that provide clarity on coherently implementing standards:
- Multi-stakeholder engagement to bring key organizations together, including standard setters, to develop a shared understanding of what good looks like when integrating human rights and environmental impacts into one due diligence process
- Building a platform on people-centered climate action in private capital markets to support private equity and venture capital investors on advancing a just transition
- Supporting members on integrated human rights and environmental due diligence in line with OECD Guidelines
- Creating collaborative spaces for companies to advance in this area, including through the Human Rights Working Group, Climate and Nature Working Group, and Impactful Sustainability Due Diligence Roundtable Series
- Developing insights, including on how to take an integrated approach to climate and human rights under CSDDD and across regulatory compliance efforts
Interested in implementing effective HREDD in your company? Reach out to BSR’s Human Rights team.
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