ESRS Standard
ESRS Standard
1. the objective of this standard is to establish disclosure requirements that enable Users of the Sustainability statement to understand Own workforce/own workers in the value chain in the context of the company's own operations and value chain, including in the context of its products or services, and through its Business relationships and the Material risks and Opportunities associated with them, including:
(a) the company's material positive and negative actual or potential impacts on labor in the Value chain,
b) Any actions taken to prevent, mitigate or ameliorate actual or potential negative Impacts and to manage Risks and Opportunities, and the results of these actions,
c) the nature, type and extent of the company's Material risks and opportunities, including those associated with its Impacts or Dependencies in relation to labor in the Value chain, and how the company manages them; and
d) the financial effects of the material risks and opportunities arising in the short, medium and long term, including those arising from the company's Impacts and Dependencies in relation to labor in the Value chain.
2. to achieve the objective, this standard requires an explanation of the general approach taken by the company to identify and address all material actual and potential impacts on the labor force in the Value chain in relation to the following:
(a) Working conditions (e.g., secure employment, working hours, Adequate wages, Social dialogue, Freedom of association, including the existence of works councils, Collective bargaining, Work-life balance, and Health and safety),
b) Equal treatment and Equal opportunities for all (e.g. gender equality and equal Wage for work of equal value, training and skills development, employment and inclusion of Persons with disabilities, Actions against violence and Harassment in the workplace and diversity),
c) other work-related rights (e.g. Child labour, Forced labour, adequate housing, water and sanitation and privacy).
3 In addition, this standard requires an explanation of how such impacts and the company's dependencies on labor in the Value chain can create Material risks or Opportunities for the company. For example, negative impacts on workers in the Value chain can disrupt the company's business (if customers do not buy its products or if government agencies confiscate its products) and damage its reputation. Conversely, respect for workers' rights and active support programs (e.g. through financial literacy initiatives) can open up business opportunities, such as more reliable supplies or an expansion of the future consumer base.
4. this standard covers all workers in the company's upstream and downstream value chain on which the company has or can have a material impact, including impacts associated with the company's own operations and value chain, including its products or services and its business relationships. This includes all workers who are not covered by the term "company workforce" (the term "company workforce" refers to employees, individual contractors (i.e. self-employed) and workers provided by third-party companies that are primarily engaged in the placement and supply of labor). The entity's workforce is dealt with in ESRS S1 The entity's workforce. Examples that fall within the scope of this standard can be found in section AR 3.
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Application Requirements (AR)
Application Requirements (AR)
AR 1 In addition to the topics identified in paragraph 2, the company may also consider disclosing information on other topics relevant to Impact materiality over a shorter time period, such as initiatives related to the health and safety of workers in the Value chain during a pandemic.
AR 2 The overview of social aspects and human rights issues in paragraph 2 does not imply that all of these aspects should be addressed in every disclosure requirement in this standard. Rather, it provides a list of aspects that the company should consider in its materiality analysisrelated to labor in the value chain (see ESRS 1 Chapter 3 Double materiality as a basis for disclosing sustainability information and ESRS 2 IRO-1) and disclose as Material Impacts, Risks and Opportunities under this Standard, where applicable.
AR 3 Workforce covered by this standard includes, for example:
(a) Workers performing outsourced services at the entity's facility (e.g., third-party hospitality or security personnel),
b) Workers of a Supplier contracted by the Company who work on the Supplier's premises according to the Supplier's working methods,
c) workers in a "downstream" company that purchases goods or services from the company,
(d) workers at an equipment supplier to the Company who regularly maintain the Supplier's equipment (e.g. photocopier) at a Company facility in accordance with the contract between the equipment supplier and the Company; and
e) workers who extract Raw materials lower in the Supply chain, which are then processed into components used in the company's products.
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