Human Rights
Our Approach to Human Rights
As the reach and scale of renewable energy increase, integrating sustainability into everything we do is as essential as ever.
In support of this, Vestas has committed to respecting human rights as set out in the UN Guiding Principles on Business and Human Rights, the OECD Guiding Principles for Multinational Enterprises, the International Bill of Human Rights, and the International Labour Organization (ILO) Fundamental Labour Conventions.
Our approach to working with human rights is defined by our CSR blueprint. Our Human Rights Policy, Codes of Conduct, and Sustainability Strategy anchor our commitment.
Our CSR blueprint consists of three pillars:
• Responsibility, strengthening human rights governance and management;
• Inclusiveness, creating long-term value and engagement where we are present;
• Leadership, ensuring the integration of Human Rights in the energy transition.
Our CSR Blueprint reinforces the third pillar of our Sustainability Strategy: becoming the safest, most inclusive & socially responsible company in the energy industry. Respecting human rights is a fundamental part of achieving this goal.
"As renewable energy takes centre-stage, working towards a just energy transition across our industry is an imperative. With the increasing level of legal and societal developments in the human rights space, it is as important as ever to develop a collaborative approach to respecting human rights."
Kristian Heydenreich
Senior Director – CSR and Global Compliance
Embedding Human Rights
Governance
Vestas’ Board of Directors, approves policies, procedures, and controls in key areas. This includes our Human Rights Policy, Employee and Supplier Codes of Conduct, and DEIB Policy. The Board or Management annually review these documents to confirm we have the right governance processes in place. Furthermore, the Audit Committee of the Board of Directors is responsible for sustainability due diligence and for overseeing compliance with our Code of Conduct. More information can be found in the Charter of the Audit Committee.
The Sustainability Committee prioritises, oversees, and coordinates cross-functional sustainability initiatives across the entire organisation.
The Ethics Committees also provide oversight of ongoing human rights-related matters as part of their mandate to review EthicsLine cases and determine appropriate decisions and actions including remediation. The Group Ethics Committee is composed of the GSVP of Legal Risk & Compliance who is also the Chairman of the Committee, the Head of Group Finance, and the EVP of People & Culture. Each region has a similar setup for their Regional Ethics Committee.
Day-to-Day Responsibility
The Compliance & CSR department works to embed human rights management across the organisation. This includes the day-to-day responsibility of developing and updating the Human Rights Policy, Human Rights Due Diligence, and monitoring legal trends and expectations in the human rights landscape to embed them into our business.
The implementation of Vestas’ policies and procedures, but also the integration of responses to salient human rights, is done in collaboration with different levels of stakeholders across the company. For example, with the sustainability department at a strategic level, with regional legal teams for the execution of regional compliance programs, with Sales and Construction teams at the wind farm project level, or with Sustainable Procurement for upstream management of salient human rights. In Sustainable Procurement, we have dedicated two specific social sustainability experts to our team as part of our commitment to implementing the 2022 HRA recommendations. This addition ensures improved oversight of human rights issues within our supply chain, further reinforcing our commitment to responsible practices.
Identifying & Assessing our Salient Human Rights Issues
Vestas aims to engage with external experts to conduct our corporate-wide Human Rights Assessment (HRA) as a minimum every three years. Conducting the assessments on a regular basis allows us to identify and assess emerging human rights risks and impacts, to integrate findings into business practices as the business evolves while also tracking and communicating progress.
In 2018 we engaged external sustainability experts from BSR to conduct the first corporate-wide HRA, and in 2022 the assessment was updated to reflect changes in our operating model, geopolitical pressures, and stakeholder expectations. By working with external sustainability experts on the UN Guiding Principles on Business and Human Rights, we have a clearer visibility of the issues at greatest risk of creating adverse impacts to rightsholders including vulnerable groups.
Both HRAs utilized a similar methodology and mapped out relevant actual and potential human rights risks looking at how Vestas might impact rightsholders across our activities and value chain. The assessments consisted of desktop research, an analysis of internal management processes, and interviews. Since 2018, the assessment has evolved to include interviews with external stakeholders representing relevant rightsholder groups such as indigenous peoples and workers, besides Vestas’ senior management and internal subject matter experts. The 2022 assessment also included the two new areas of our business, namely Offshore and Development activities in addition to Supply Chain and Manufacturing, Construction, and Service. In addition to our CW-HRA, Vestas conducts upstream and downstream due diligence which takes a more in-depth look at risks related to a country and location. See our below section on Preventing & Mitigating for more information.
Preventing & Mitigating
In line with the UN Guiding Principles on Business and Human Rights, Vestas adopts a full-value-chain approach to its human rights due diligence informed by our company-wide human rights assessments to identify gaps and address human rights issues.
By taking a full-value chain approach to due diligence both downstream when we supply turbines and services to our customers and upstream when we engage with suppliers, we seek to identify, prevent and mitigate any potential or actual human rights impacts. At the same time, we aim to use our leverage in business relationships to contribute to appropriate action when possible.
Downstream, we conduct social due diligence on high-risk projects to assess the potential human rights impacts associated with the construction and operation of wind farms. The assessment is based on project documents shared by our customers and site visits to validate data or collect additional data. Through these assessments, we identify any risks or adverse effects on local communities, workers, and other stakeholders and take appropriate measures together with our customers to mitigate them.
We also recognize that our suppliers play a crucial role in respecting human rights, and therefore, we work closely with them to ensure that they uphold the same standards. This involves assessing their social and environmental management practices, including labour conditions, worker safety, and the prevention of forced labour and child labour.
You can read more about our downstream (project-level) social due diligence and upstream (supply chain) due diligence below.
- File title:
- Download Social Management System
Tracking & Communicating
As part of our commitment to respecting human rights, we track and communicate our progress on our salient human rights issues through different indicators. To ensure cross-functional progress on our human rights performance internally, we have established a steering committee with members from Corporate Social Responsibility (CSR), People and Culture (P&C), Sustainable Procurement, and Health, Safety, and Environment (HSE) to work on implementing the recommendations of our Corporate-Wide Human Rights Assessment.
Communication on our approach, progress, and setbacks on human rights is an essential part of our ongoing human rights due diligence process. We track our human rights performance across several indicators in our sustainability-key figures, in our annual financial report that includes our sustainability statement and our overall progress on the implementation of our human rights assessment recommendations.
While our external communication and tracking are evolving and we aim to achieve a more systematic way of tracking our progress across all our salient human rights, we have achieved progress in reporting on community-related human rights issues, occupational health & safety, grievances, and supplier performance monitoring.
Read more about how we engage and communicate with human rights internally and externally below.
Grievance & Remediation
Vestas is committed to remedying actual adverse impacts on any individual or group we may have caused or contributed to.
At the same time, we also expect our suppliers to have appropriate grievance mechanisms proportionate to their size, complexity and to the risk of their business environment. In parallel, our suppliers are also expected to remedy any adverse impacts on individuals, workers and communities that they may have caused or contributed to. Suppliers and their employees are also encouraged to use our global whistleblower system, EthicsLine, to make a report if they suspect misconduct linked to Vestas.
In cases where we may be linked to adverse impacts for example through third parties including suppliers, we seek to use our leverage to ensure that any impacted stakeholder is remediated. For this purpose, Vestas has in place an Operational-level Grievance Mechanism (OGM) used during the construction of our wind farm projects and EthicsLine, our whistle-blower hotline which is publicly available and accessible. Vestas furthermore commits to collaborate with judicial or non-judicial mechanisms such as national courts, Ombuds Institutions, OECD National Contact Points, national human rights institutions as mean to provide access to remedy.
Promoting human rights in the energy transition
As the aspiring world leader in sustainable energy solutions, Vestas is working to accelerate the renewable industry’s human rights performance through fostering partnerships. If the energy transition is to be truly responsible and inclusive, we need to adopt a cross-stakeholder, collaborative approach to respecting business-related human rights. Human rights are transitioning from soft law to hard law and financial institutions are firming up their demands. Vestas and its partners will have to approach these changes together.
To this end, Vestas continuously seeks to contribute to the ongoing dialogue on business and human rights by building and using leverage, participating in public statements and sharing our experiences in panels, networks, and documents. As a recent example, in 2023 we contributed with a case study on our full value chain approach to due diligence to a new publication on Due Diligence in the Downstream Value Chain by the Danish Institute of Human Rights. We also form part of many different networks e.g., the Nordic Business Network for Human Rights, the local UN Global Compact network on Human Rights, are a part of the Dutch International Responsible Business Conduct Agreement for the Renewable Energy Sector (which includes a Renewable Energy Complaints and Disputes Committee), as well as the Wind Energy Initiative with other key industry players.