This challenge reflects a broader pattern: the widespread assumption that investing in value chain responsibility can undermine competitiveness remains a major barrier to action. Yet this assumption persists largely because organisations often lack a structured way to understand the business implications of their human rights risks.
Human rights are still sometimes framed as a “trade‑off” with competitiveness. However, this is a false dilemma.
As the UNDP, the UN’s global development network dedicated to reducing inequality, strengthening governance and supporting sustainable economic and social progress in more than 170 countries, highlights in ‘Human Rights vs. Competitiveness: A False Dilemma?’, companies that proactively address human rights risks are often more resilient, more trusted and better prepared for future regulation and market expectations. Strong human rights due diligence not only reduces volatility and protects long‑term value, but also positions organisations to meet the rising requirements under frameworks such as the CSRD, CSDDD, and the upcoming EU Forced Labour Regulation.
The key question is therefore no longer whether to act, but how to act effectively and convincingly.
For many sustainability managers, the key question for organisations is clear: what does it cost not to address human rights risks in the value chain?
Real‑world cases show why understanding human rights risks is essential. In one widely reported incident in the fashion sector, labour rights violations were uncovered at subcontracted factories several tiers down the value chain. Workers were found to be paid far below legal minimum wages and faced unsafe working conditions. Although these abuses occurred several tiers down the value chain, they were quickly linked to the brand once exposed. The financial impact was immediate: the company’s share price dropped more than 40% within days, wiping over £1.5 billion from its market value. This was later followed by investor claims exceeding £100 million, alleging failures to disclose material supply‑chain risks.
Examples like this illustrate that incidents occurring deeper in the value chain, where visibility is often limited, can still have immediate and significant financial consequences.
To support these discussions and steer towards action on value chain impacts, organisations need a structured way to assess the potential business relevance of human rights risks. At Impact House by Grant Thornton, we help organisations translate risks of negative impacts, including on human rights, in their value chain into quantifiable business impacts to support decision-making, prioritisation and board‑level discussions on value chain responsibility.
What we do in four straightforward steps:
Instead of generic risk scores, you get a financially grounded story that shows the cost of inaction and the value of acting now. This helps organisations move from compliance‑driven discussions to strategic decision‑making. In short, we make the invisible visible and measurable.
Assessing the cost of human rights issues in the value chain will support better informed decisions: about investment in due diligence processes, sourcing strategies, supplier engagement and long-term value creation. As this assessment makes the implications of human rights risks explicit and business-relevant, organisations can move beyond high-level commitments toward targeted and prioritised action.
In practice, this approach supports organisations to:
Are you struggling to move decision‑makers to invest in addressing human rights challenges in your value chain? Or do you need concrete, financially grounded insights to prioritise action? Our experts can help. Together, we turn human rights risks into clear insights and insights into action.
Get in touch to explore how our Value Chain Cost Assessment can support your organisation.
