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 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.
Embedding Human Rights
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 overseeing Vestas’ status on compliance with the Corporate Social Responsibility (CSR) elements included in our Code of Conduct.
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.
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.
The 2022 HRA reassessed the salient human rights issues in our business. Each salient issue was prioritised according to two sets of criteria: the salience of risk (scale, scope, remediability, likelihood) and relevance for business action (attribution, leverage, risk history, current management). Depending on the salience of risk and the relevance for business action each salient human rights issue was assigned a priority level.
The assessment identified some areas of continuous priority that remain the same as in 2018 and new priority matters for business action. Our ongoing focus areas continue to be rights related to labour conditions, occupational health and safety, community engagement and land rights. Our new priority areas for business action are high-risk and conflict-affected areas, access to remedy, and human rights defenders. Each prioritised issue came with a set of recommendations for the coming years. The assessment also recognised that these issues can be particularly salient to vulnerable groups of rightsholders such as migrant workers, indigenous and tribal peoples, temporary workers, and low-income populations.
We will continue focusing on labour-related rights in our supply chain by expanding our sustainability risk assessment matrix to include more human and labour rights indexes as recommended in the HRA. Furthermore, we will implement recommendations within community engagement and land rights within our new Development function to ensure a systematic approach to managing risks related to meaningful consultation and land rights in development. To facilitate improved access to remedy, we will, as recommended by the HRA, revisit and communicate our renewed grievance mechanism process internally. The assessment also guided us to strengthen our due diligence and decision-making processes to cater more specifically for potential risks related to activities if operating in high-risk and conflict-affected areas and for human rights defenders.
The HRA also included a set of management recommendations steering us to improve our human rights governance by enhancing oversight, accountability, and coordination across departments and building capacity on human rights across the organisation. We will continue working with internal human rights governance to anchor responsibility for different human rights areas across functions for increased transparency and accountability and strengthen capabilities on human rights through training and knowledge sharing.
You can read more about our progress in our 2022 Sustainability Report.
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.
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- Download Social Management System
Vestas acknowledges that large-scale wind energy projects can potentially impact surrounding communities both positively and negatively. As a supplier to these projects, Vestas has a role to play in addressing any potential negative impacts on affected communities in collaboration with our customers and in furthering positive impacts as well.
To do so, Vestas has established a social due diligence (SDD) tool used in high-risk projects to identify, prevent and mitigate any potential negative impacts e.g., community health, safety and livelihood, and inform our community engagement initiatives. The SDD consists of a Country assessment, a Know-Your-Customer assessment and an in-dept Project-level assessment supported by site visits, where relevant, to collect or validate data. The tool is applied during the Bidding phase and continues throughout our involvement in the project.
One of the targets in the people pillar of our sustainability strategy is to ensure that 100% of all projects within scope undergo social due diligence.
Vestas prioritizes stringent supplier standards through a comprehensive upstream due diligence process. This includes thorough pre-screening, self-assessment questionnaires, on-site and desktop evaluations, and ongoing performance monitoring.
In order to establish direct collaboration with suppliers and oversee due diligence processes, Vestas has integrated a dedicated Sustainable Procurement team in its Global Procurement function. This team's key priorities revolve around initiatives, processes, and policies that aim upholding the company's standards for sustainable and ethical business practices within the upstream supply chain. These priorities serve as guiding principles for Regional Procurement Officers, shaping their actions and decisions throughout the supplier onboarding qualification process, self-assessments, and on-site and desktop assessments.
By incorporating sustainability requirements into our onboarding and auditing procedures, we contribute to the development of a sustainable and resilient supply base that is attuned to local needs and conditions. In addition, we aim to foster strong partnerships with our suppliers on certain sustainability matters. As part of our commitment to implementing the 2022 Human Rights Assessment recommendations, we have dedicated two specific social sustainability experts in our team.
Through this comprehensive upstream due diligence process, we ensure that our suppliers follow the high standards set forth in the Supplier Code of Conduct.
To learn more about Supplier Sustainability at Vestas, please visit our Supplier Sustainability page.
Tracking & Communicating
As part of our commitment to respecting human rights, we track our progress on our salient human rights issues through different indicators to communicate internally and externally.
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 and sustainability reports 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.
Vestas tracks its performance against several salient human rights issues including occupational health and safety, community-related salient human rights, and access to remedy in relation to our different rightsholder groups.
For our own employees' occupational health and safety, our sustainability report and annual report include several safety KPIs including the Total Recordable Injuries (including Lost Time Injuries and fatal injuries), Total Recordable Injuries per million working hours, and Lost Time Injuries per million working hours.
To report on access to grievance, we publish the number of EthicsLine cases yearly and the number of community grievances received. While EthicsLine is publicly available for all stakeholders, our whistle-blower platform is primarily used by our own workforce and is thus our employees' main tool for communicating grievances related to our Code of Conduct or violations to policies or laws. Community grievances in turn, refer to the grievances that have been raised by affected communities on Vestas operated sites through the operational grievance mechanism.
Our progress in de-risking impacts to communities is also tracked through the percentage of projects in scope that have undergone the Social Due Diligence Projects assessment and the number of community beneficiaries we reach on a yearly basis. We have a target of conducting our social due diligence assessments in 100% of our in-scope projects by 2025. Our other community-related target was to reach 35,000 community beneficiaries through our community engagement initiatives by 2025. In 2022, we reached that goal in anticipation, reaching more than 36,000 people through our community engagement activities.
Besides our sustainability key figures, we also report on the progress on the implementation of the recommendations of our human rights assessment. For our most recent status update you can read our 2022 Sustainability Report or the summary of our 2022 corporate-wide human rights assessment where we summarize our progress since our first HRA in 2018.
Externally, we communicate on our progress on human rights in our sustainability reports, annual reports, website, and UN Global Compact’s yearly Communication on Progress (CoP). We also share activities related to human rights on social media posts and blogs on our website. Customer engagement is another important means of communicating our human rights approach and exploring joined ways forward to address potential adverse human rights impacts in our industry.
Internal communication is also essential for managing human rights proactively. Training and awareness initiatives are important tools to ensure that our human rights approach is understood by our employees, and that they are aware of our internal policies and commitments to help integrate human rights in the organization. For the past years, we have been running different human rights related awareness and training initiatives including a mandatory company-wide micro-learning about our sustainability strategy, including practical examples of some of our salient human rights issues, and a mandatory micro-learning about discrimination & harassment. We have also conducted webinars about modern slavery and our human rights approach done in collaboration with a customer, as well as yearly intranet articles on International Human Rights Day.
Grievance & Remediation
Vestas is committed to remedying actual adverse impacts on any individual or group we may have caused or contributed to and to collaborating with judicial and non-judicial mechanisms when necessary.
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.
In cases where we may be linked to adverse impacts, 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.
The Operational Grievance Mechanism (OGM) applies globally and has been developed to meet the expectations outlined in international standards and principles such as the UN Guiding Principles for Business and Human Rights, OECD Guidelines for Multinational Enterprises on Responsible Business Conduct and IFC’s Environmental and Social Performance Standards. The OGM is available in English and in local languages, without obstructing access to other remedies.
Our OGM is open to all external stakeholders that may have a concern or complaint related to a project. Any complainant, be it a group or an individual, can raise a concern or a grievance related to human rights issues e.g., community health & safety, cultural heritage & customs, misalignment on benefits, security guards, and land compensation. We investigate these concerns according to our procedures and determine remediation actions in collaboration with the complainants when necessary.
Our approach to remediation varies from case to case but it could for example consist of an apology, replacement of damaged material, allocation of new land, or compensation for loss of livelihood. A recent example of remedy provision took place in one of our projects in Jordan in 2020. Local farmers experienced negative impacts in their livelihoods due to the dust emissions from heavy transportation. The dust covered livestock grazing areas and olive trees, resulting in reduced income. To address this issue, we hired an independent consultant that conducted a rigorous impact assessment and calculated a fair level of compensation. The complainants were compensated for their loss of income. After this case, we implemented changes in the training of our transport suppliers to raise awareness about dust-related impacts on people and how we expect them to mitigate it through e.g., speed limits on site and covering trucks.
Vestas reports on the number of community grievances received in our Annual Report and Sustainability Report. Every year we receive a number of grievances, which we interpret as a positive signal that our operational-level grievance mechanism is being used. We will continue to revise and improve our grievance mechanism so that local communities have the opportunity to raise issues with us as soon as they arise.
More information about the OGM process can be found in our Social Management System which describes our social framework.
Vestas is committed to providing a safe environment for our employees and partners to speak up if they witness misconduct.
In addition to our Operational-level Grievance Mechanism, Vestas has EthicsLine, a global whistle-blower platform which can be used to report observed or suspected misconduct. EthicsLine allows our employees and partners to report violations of the Vestas Code of Conduct, applicable laws, and Vestas's policies. Since 2007, EthicsLine has helped ensure that such violations are always brought forward and dealt with appropriately.
We report on the number of complaints and questions received through EthicsLine on our annual financial statement and sustainability report. Findings of previous EthicsLine and community grievance cases are used for training material for internal learning.
EthicsLine is accessible publicly here.
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 BSR’s Collaborative Initiative Energy for a Just Transition and the Dutch International Responsible Business Conduct Agreement for the Renewable Energy Sector.
- File title:
- Download Human Rights Journey
- Vestas Employee Code of Conduct
- A set of rules and principles that outline the behavioral expectations we have of our employees
- Vestas Supplier Code of Conduct
- A set of rules and principles that outline the behavioral expectations we have of our business partners
- Human Rights Policy
- This policy outlines Vestas' commitment to respecting human rights and addressing adverse human rights impacts, when applicable
- Social Management System
- An outline of our human rights methodology in our market approach, supporting customers in creating bankable projects
- An outline of our human rights methodology in our market approach, supporting customers in creating bankable projects
- Lake Turkana Impact Study
- A socio-economic study of the key impacts from Lake Turkana Wind Power project in Kenya
- Documenting Business Respect for Human Rights
- A new study from the Danish Institute for Human Rights that examined how the largest companies in Denmark document their work with human rights, where Vestas ranked second
- Supporting EU level mandatory human rights legislation
- Together with 11 other companies, Vestas released a statement supporting EU legislation that will make it mandatory for companies to prevent and mitigate negative human rights impacts to workers and communities