The role of stakeholder engagement and grievance mechanisms

Key Takeaways

• Stakeholder engagement is a key element of  human rights due diligence under the UN Guiding Principles on Business and Human Rights (UNGPs) and the EU Corporate Sustainability Due Diligence Directive (CSDDD).
• Direct insight from workers, communities and suppliers reveals risks that desk research cannot.
• Collaboration with suppliers is more effective than top-down compliance.
• Strong grievance mechanisms help surface issues early and reduce risk.

The Importance of Stakeholder Engagement in Human Rights Due Diligence

Both the UNGPs and the recently amended CSDDD expect businesses to conduct meaningful consultation with people who may be affected by their operations. 

This requires moving beyond policies and procedures and engaging directly with individuals who have first-hand experience of the risks. Consultation should inform key stages of the due diligence process, including how risks are identified, assessed and prioritised.

Engagement ensures that businesses understand real conditions in their operations and supply chains. It provides insights that desk-based research cannot replicate.

Engaging the Right Stakeholders During the Due Diligence Process

To build an accurate understanding of potential or actual impacts, organisations should engage with three main stakeholder groups.

Internal teams

Procurement, in-house legal, HR, sustainability teams and others involved in supplier relationships hold practical knowledge about where risks are likely to arise. Their insights help determine where leverage exists and how risks can realistically be addressed.

External partners

Suppliers, labour providers, recruitment agencies, contractors and governments are often closest to the issues and have the greatest influence over solutions. Their operational proximity makes them essential collaborators.

Workers, communities and their representatives

Workers, unions, community groups, NGOs, health providers and faith leaders provide lived experience of working conditions and local realities. If an organisation has staff based in sourcing regions, they can help facilitate conversations with affected people and ensure their perspectives inform decision-making.

Overall, engagement is more effective than enforcement. For example, site managers in UK agriculture who build trust with migrant workers and involve unions or NGOs in explaining rights tend to resolve issues more successfully than through remote head office directives.

How Effective Grievance Mechanisms Support Responsible Business Conduct

The UNGPs expect companies to establish or participate in operational level grievance mechanisms that affected individuals can access directly. The CSDDD requires companies to provide a fair, transparent and predictable complaints procedure.

A strong grievance mechanism should be independent, confidential and safe to use without fear of retaliation.

When designed well, grievance mechanisms uncover issues such as unsafe working practices, excessive recruitment fees, unpaid wages and discrimination. Early visibility allows businesses to address concerns before they escalate, protecting people and reducing legal or reputational exposure.

History demonstrates the consequences when grievances go unheard. The 2013 collapse of Rana Plaza in Bangladesh remains a critical example of what can happen when worker concerns are ignored.

Embedding Engagement and Grievance Mechanisms into Business Practice

Successful human rights due diligence depends on listening to a  range of voices. Engagement with internal teams, suppliers, workers and communities ensures that risks are understood accurately and addressed effectively. Grievance mechanisms provide a safe channel for concerns to be raised early, allowing organisations to act before harm occurs.

For businesses preparing for the CSDDD or aligning with international standards, these approaches are not optional. They form the foundation of responsible business practice and long-term risk management.

For more information, watch the accompanying video and look out for more videos and articles in this series on how to do risk-based human rights due diligence, or please get in touch.