Social Life Cycle Metrics for Chemical Products

Social Life Cycle Metrics for Chemical Products A guideline by the chemical sector to assess and report on the social impact of chemical products, based on a life cycle approach

November 2016 Building a sustainable world Chemicals are the basis of most Avoided Emissions Challenge” where more than 9 billion people of the products in the world. (2013), and “Life Cycle Metrics can live within the boundaries of Customers, governmental bodies, for Chemical Products” (2014). the planet by 2050 is a powerful non-governmental organizations All of these guidance documents mission. As a solution provider, and consumers are increasingly share a common objective – to the chemical industry is key to aware that the chemical sector provide guidelines and metrics helping reach this long term vision, has an important role to play for consistent and credible through innovative products and to create a positive impact on measurement and communication solutions that contribute to solving people’s health and well-being, on how the value chains of sustainability challenges. and prevent possible negative chemicals impact on and Therefore, as Co-Chairs of impacts. Therefore, defining contribute to sustainability. the World Business Council’s this new standard is important We are grateful for organizations Reaching Full Potential chemical because, ‘what you can measure, such as the United National sector project’s Metrics activities, you can manage’. With a common Environment Programme (UNEP), we are pleased to present this framework for assessing and and the Product Social Metrics fourth publication on sector reporting on social life cycle Roundtable, and many others, guidance for assessing and metrics, we have a means to for paving the way in the area of reporting on the sustainability improve the social impact of our social metrics. This document performance of chemical products. products within the communities in builds off of those, to develop a which we are active, for the end- This guidance presents social life common framework for chemical users our solutions are used by, cycle Metrics and is the first of companies to use. its kind for the chemical industry. and all the involved workers along We also are thankful to the It enables chemical companies the entire value chain. many stakeholders that provided to assess and report on social This guidance rounds out the feedback and input on this guide. impacts of chemical products previous guidance documents Just as in our previous guidelines, within the full value chain, by we have developed in the we encourage our value chain taking a life cycle approach. WBCSD, including “Guidance partners and stakeholders to for Accounting & Reporting engage with us to further improve Corporate GHG Emissions the guidelines and quality of our in the Chemical Sector Value methodology. Chain” (2013), “Addressing the

Mr. Feike Sijbesma Dr. Kurt Bock Mr. Jean-Pierre Clamadieu Chief Executive Officer Chief Executive Officer Chief Executive Officer Royal DSM BASF Solvay The working group has been Several stakeholders and experts Business); Professor Atsushi led by Andrea Brown, Director, external to the chemical industry Inaba (Kogakuin University); Sustainable Materials from the have been asked to proceed with Charles Duclaux (L’Oreal); Guy WBCSD and been supported by a critical review of this guide. In Castelan (PlasticsEurope); João PricewaterhouseCoopers. particular, we would like to express Fontes and Mark Goedkoop (PRé We thank Isabelle Spiegel, Olivier our thanks to the following people Sustainability); Douglas Mazeffa Muller, Cathelijne Klomp, Juliette for their valuable input: Marzia (Sherwin Williams); Francisca Lefébure and other collaborators Traverso (BMW Group); Luce Hubeek (Solidaridad); Albert Kruft for their contribution in different Beaulieu, Professor Jean-Pierre (The Sustainable Development phases of the project. Revéret, and Sara Russo Garrido workgroup of Solvay’s European (CIRAIG-UQAM); Lynette Chung Works Council); Fayçal Boureima, (Clariant) ; Lise Laurin (EarthShift); Llorenç Milà i Canals (UNEP-DTIE). Dr. Laura Schneider (Econsense - Forum for Sustainable Development of German 4 | Social Life Cycle Metrics for Chemical Products

Acknowledgements

Working Group on Life Cycle Metrics participants: AkzoNobel Carmen Alvarado, Klas Hallberg, Peter Nieuwenhuizenn

BASF Peter Saling

DSM Kimberley Chan, Jacobine Das Gupta, Dave Morris, Gaelle Nicole, Fokko Wientjes

CEFIC Ann Dierckx, William Garcia

Eastman Chemical Cathy Combs, Anne Kilgore, Barclay Satterfield

Evonik Industries Stefan Haver, Thomas Jostmann, Guido Vornholt

Henkel Uwe Bergman, Joerg Feesch, Kyle Whitaker Mitsubishi Chemicals Holdings Corporation Matsuda Kiyoshi

SABIC Gretchen Govoni, Rajesh Mehta, Ashok Menon, Suchira Sen, Venkata Krishna Kumar Upadhyayula

Solvay Michel Bande, Pierre Coërs, Dominique Debecker, Joachim Poesch, Jean-François Viot Social Life Cycle Metrics for Chemical Products | 5

1. 2. EXECUTIVE SUMMARY 6 INTRODUCTION 10

1.1 Why define common social metrics for the life cycle of chemical products? 6 2.1 The purpose of this guide 10 1.2. Value of this guide 7 2.2 How it was developed 10 1.3 Key features of this guidance 8 2.3 What is the relationship to existing 11 standards and guidelines? 2.4 Intended use of this guide 12 2.5 Scope 12 2.6 How to read this guide 13 2.7 Requirement status 13

3. 4. 5. PRINCIPLES 14 KEY COMPONENTS CORE METHODOLOGY OF THE ASSESSMENT FOR SOCIAL IMPACT METHODOLOGY 16 ASSESSMENT 26

4.1 Stakeholder groups 16 4.2 Overarching Social Areas 17 5.1 Goal & scope 26 4.3 Social topics 20 5.2 Functional unit 27 4.4 Indicators 23 5.3 Selection of social topics for each 51 specific product assessment 4.5 Assessment through reference scales 26 5.4 Choice of indicators and advanced indicators 30 5.5 Setting up reference scales for indicators and advanced indicators 30 5.6 Boundary setting 5.7 Data collection 32 5.8 Data quality assessment 37 6. 7. 40 INTERPRETATION & OUTLOOK 50 COMMUNICATION OF RESULTS 44

6.1 Uncertainties and limits of results 44 6.2 Aggregation (optional) 45 6.3 Interpretation of the results 48 6.4 Peer review 48 6.5 Communication of results 49

8. APPENDICES 52 Appendix 1. Bibliography and references Appendix 6. Report template for chemical product Appendix 2. Databases social assessment Appendix 3. WBCSD Work group methodology Appendix 7. Gap analysis with existing literature for the building of the indicator scales Appendix 8. PVC pipes case study Appendix 4. Generic reference scales for indicators Appendix 9. Glossary and definitions and advanced indicators Appendix 10. Acronyms Appendix 5. Criteria to be applied for the risk filter to select key life cycle stages 6 | Social Life Cycle Metrics for Chemical Products

1 Executive summary

1.1 Why define common social metrics for the life cycle of chemical products? The chemical industry innovates This document provides a first This work has been mainly inspired and produces products that attempt at methodological by the Guidelines for Social Life are part of the life cycle of the guidance for the chemical Cycle Assessment of Products and majority of everyday goods. The industry globally in measuring Associated Works (UNEP/SETAC, position of the chemical industry and reporting the social impacts 2009), and the 2014 Handbook in the value chain is therefore of chemical products along their for Product Social Impact key in enabling a reduction in life cycle. The objective of this Assessment, v. 2.0, developed environmental impacts and guide is therefore to provide by the Roundtable for Product improving the social performance a consistent and credible Social Metrics. Additionally, of countless goods. To assess the assessment and communication investigations among stakeholders contribution of chemical products on both the social impact and on social impacts and previous to impact and value creation, social benefit/value of chemical work performed with the WBCSD chemical companies have invested products in their application. It on life cycle metrics devoted to substantial effort in studying the is applicable globally, to different environmental impact assessment social risks and benefits of various chemical products for various were also used as a base. products. industries and from chemical companies with a range of sizes. Social Life Cycle Metrics for Chemical Products | 7

1.2 Value of this guide This guide promotes a first The value of this guidance is the credible foundations that reflection on social impacts and that social impacts of chemical will be used for the assessment benefits/values on the full social life products can now be tangible of chemical products and the cycle for chemical sector products. and measurable for companies, development of complementary Measuring social impacts allows and companies can use this to methodologies, enabling, in companies to demonstrate positive steer product development, value the future, the comparison of contributions and improvements proposition development, and, products’ social performance on negative impacts of chemical ultimately their product portfolio as throughout the entire chemical products. a whole. Its objective is to provide sector.

1 Advancing on product-related 2 Ensuring comparable and 3 Anticipating value chain social metrics credible social impact needs assessment Building on the available This guide reflects the ambition of methodologies and standards in the This guide provides common the chemical sector to improve field of social impact, this guide is assessment foundations. It and facilitate social impact among the first global and sector- supports the future development assessments and decision-making specific guidance documents that of methodologies enabling the for companies along the value Such companies will be able can be used as a foundation to comparability of the assessment of chain. to rely consistently assess and report a chemical products in terms of social on consistent upstream and on the social chemical product’s social metrics performance. downstream information It aims to drive and support consistent performance of the chemical products along its value chain, integrating and credible product claims across they use to develop and improve their both positive and negative impacts. It has been developed in collaboration companies and across sectors. own sustainable products. with existing initiatives, such as the WBCSD Social Capital project, corporate reporting initiatives for the chemical sector, and product social impact assessment or social life cycle assessment (LCA) initiatives.

4 Engaging stakeholders 5 Providing practical and 6 Calling for action educational guidance The process to develop this guide Finally, the elaboration of this guide has included input from relevant This guide is designed to be user- has highlighted critical gaps (in terms , providing meaningful, internal and external chemical sector oriented of the development of reference scales supporting guidance, with stakeholders, ensuring that product for advanced indicators, aggregation social assessment and communication explanations and illustrations or weighting methodologies and best reflect their expectations. exclusively for the assessment of data availability) that need further social indicators for specific chemical methodological development and data products. Particular attention has gathering efforts. Covering those gaps been dedicated to the readability will allow the industry to go further of the document, both in terms of in its sustainability measurement. technical vocabulary definitions and By supporting these activities from illustrative examples. different sectors, it will be possible to generate meaningful data sets and information for the assessment of the sustainability of chemical products. 8 | Social Life Cycle Metrics for Chemical Products

1.3 Key features of this guidance

6 principles 3 stakeholders groups were followed while developing the guidance and will were targeted for this work on guide users in the implementation of the methodology: social metrics: relevance, completeness, workers, consumers, consistency, transparency, local communities. accuracy, and feasibility.

25 social topics were selected as • 14 non-mandatory social Two possibilities are provided to the most representative and were topics may be included in a define the system boundaries: split into two groups: product assessment based on cradle-to-gate and cradle-to-grave. a selection process defined in Key life cycle stages within the topics are • 11 mandatory social the present guide. Additional system boundaries are included in to be covered as a minimum indicators and optional the product assessment based on in every product assessment. advanced indicators are a process defined in this guide. Indicators and optional also proposed for each non- advanced indicators are mandatory social topic. proposed for each mandatory social topic.

OVERARCHING STAKEHOLDERS SOCIAL TOPICS Workers Local communities Consumers Social Topics • Fair wages • Appropriate working hours • Access to basic needs for human • Direct impact on basic needs • Freedom of association, collective rights and dignity (healthcare, clean (healthcare, clean water, healthy food, bargaining and labor relations Bacis rights & needs water & sanitation, healthy food, shelter, education) • No child labor shelter) • No forced labor, human trafficking and • Respect for indigenous rights slavery • No discrimination • Social/employer security and benefits

Employment • Management of reorganization • Job creation

• Workers’ occupational health risks • Management of workers’ individual • Health and safety of local community’s • Impact on consumer health and safety Health & Safety health

SOCIAL AREAS living conditions • Safety management system for workers

Skills & Knowledge • Skills, knowledge and employability • Promotion of skills and knowledge • Promotion of skills & knowledge

Legend Mandatory social topics Additional social topics to be selected by a practitioner Figure 1: Overview of the 25 mandatory and non-mandatory social topics and their corresponding stakeholders and social areas Social Life Cycle Metrics for Chemical Products | 9

5 social areas were used to group the positive and negative social consequences a product and its application can generate: basic rights and needs; employment; health and safety; skills and knowledge; well-being.

Five reference scale levels enable • Aggregation across social the valuation of each indicator topics: grouping results from all and advanced indicators: from -2 indicators within a same social (unacceptable performance) to +2 topic, social area or stakeholder (outstanding/exemplary evidence), category. via 0 (standard performance/ is possible per compliance). One peer review product assessment to assess the Two types of aggregation are consistency with the present guide. suggested as optional: Depending on the goal of the study and the distribution of the report, • Aggregation along the value the peer review can be performed grouping results of the chain: internally or externally. key life cycle stages for a given indicator. Existing worst case …and one case study illustrates results (if any) shall be flagged the present guidance: PVC pipes additionally to the aggregated for water delivery in Europe. results.

10 | Social Life Cycle Metrics for Chemical Products

2 Introduction

2.1 The purpose of this guide The objective of the present guide version 2.0 of the Handbook for • Metrics: Development of for assessing and reporting social Product Social Impact Assessment guides for consistent and impacts by the chemical sector is (PRé Sustainability, 2014) and credible communication to to provide solid foundations for stakeholder feedback. stakeholders on a chemical product’s environmental and the development of consistent The guide is part of the WBCSD’s social impact and benefit/ and credible communication Reaching Full Potential (RFP) value throughout its life cycle of a product’s social metrics Chemical Sector Project, which (Avoided GHG Emissions, throughout its whole life cycle. brings together companies that Therefore, this document proposes Environmental LCA, Social work on social impact assessment a global framework to align social Metrics); in order to develop collaborative metrics for the assessment of solutions from the chemicals value • Value Chain Collaboration: chemical products based on the chain towards a sustainable 2050. Identification of pre-competitive global/high-level investigations The RFP Project includes two work barriers and solutions to bring of the Guidelines for Social Life streams: existing chemical solutions to Cycle Assessment of Products and market faster—emphasizing Associated Works (UNEP/SETAC, the long-term disruptors and 2009) and associated works, enablers towards Vision 2050.1

1 The World Business Council for Sustainable Development’s (WBCSD) cornerstone Vision 2050 report calls for a new agenda for business and lays out a pathway to a world in which 9 billion people can live well, and within the planet’s boundaries, by mid-century. More information is available on the WBCSD website: http://www.wbcsd.org/vision2050.aspx.

2.2 How it was developed

The guide is the result of a Chemical Industry Council (CEFIC). consistency of chemical product collaborative process among The group met over 20 months social impacts and social benefit/ 10 global chemical companies to cooperatively share their best value assessments along the life that are WBCSD members. The practices and jointly generate cycle. collaborative Working Group new approaches. The outcome, on Life Cycle Metrics has also this sector guide, is designed to been supported by the European improve the harmonization and Social Life Cycle Metrics for Chemical Products | 11

2014 2015

March April May June Jul-Aug Sept. Oct. Nov. Dec. Jan. Feb. March April May June Jul-Aug Sept. Oct. Nov. Dec.

Webinar Meetings Decision Work-shop meeting

Feedback on the report External Overall review/ Internal review review Layout

Progress on the report V1 V2 V3 Final

Figure 1: Overview of the 25 mandatory and non-mandatory social topics and their corresponding stakeholders and social areas

The Working Group on Life Cycle Metrics The social metrics methodology was A stakeholder engagement process was was chaired by DSM and co-steered by developed and decided on during four also carried out to seek feedback on this DSM, BASF and Solvay. Working group dedicated workshops lasting two full guide. In May 2015, several stakeholders members included Aditya Birla, AkzoNobel, days each at WBCSD headquarters. The with a wide range of profiles (NGOs, BASF, DSM, Eastman Chemical, Evonik people involved from each company are universities, global companies, LCA Industries, Henkel, Mitsubishi Chemical experts with diverse backgrounds linked experts, etc.) were requested to provide Holdings, SABIC, and Solvay which are to social metrics (life cycle assessment their feedback on the guide (general globally active companies representing Asia, (LCA) practitioners, human resources (HR) opinion and specific issues). More than the Middle East, the United States, and and corporate social responsibility (CSR) 200 specific comments, were received Europe. The European Chemical Industry experts, etc.) and were supported internally and discussed with the working group in Council (CEFIC) was also represented in the by complementary expertise when needed order to improve the guide. A document Working Group. (e.g. legal or marketing departments). The grouping all the comments and decisions whole project, and the decision-making made by the working group has been The project lasted from March 2014 through within, has been supported by the WBCSD created to keep track of present and March 2016. During this time, subgroups and PricewaterhouseCoopers. future amendments to the guide. were deployed so as to decide specifically on the development of social topics and the definition of indicators.

2.3 What is the relationship to existing standards and guidelines?

The key feature of this guide 2.0 of the Handbook for Product for the indicators reflect the is to offer the foundations of a Social Impact Assessment (PRé key social impacts to consider commonly and internationally Sustainability, 2014). Previous when assessing a product from accepted methodology in the field work performed by the WBCSD the chemical industry. This of social metrics that is specific to on life cycle metrics devoted to approach explains some of the the chemical industry. environmental impact assessment differences observed with existing was also used as a base. methodologies and is explained in It is built upon existing guidelines: Appendix 7. it relies heavily on the Guidelines The choice of social areas, social for Social Life Cycle Assessment topics and indicators was made of Products and Associated Works based on a chemical sector (UNEP/SETAC, 2009) and version perspective. The scales defined 12 | Social Life Cycle Metrics for Chemical Products

2 Introduction continued

2.4 Intended use of this guide This guide is designed from a purchasing, human • Users of chemical products chemical industry perspective. It resources, etc.) to assess in the value chain, in order is intended to be used by: and eventually improve their for them to understand the social impacts. Different assumptions supporting the • Chemical companies that seek functions of one company social product claims of the to assess and communicate can then be involved chemical sector. the social impact and values of to bring their expertise their products along the whole • Other groups considering social to specific parts of the value chain, and especially: metrics (including at corporate assessment; level) in order to develop a 1. Internally (life cycle 2. Externally to communicate more complete methodology assessment group the results to value for the social assessment of members, people in charge chain partners and other chemical sector products and of sustainability, corporate stakeholders. to allow comparisons in future social responsibility, methodologies. reporting, marketing,

2.5 Scope of this guide This guide exclusively covers areas product application, or when data that would enable the related to social impacts. Whenever comparing two or more chemical definition of performance reference economic and environmental areas are product applications, and the points and then position a result addressed, it is because they are linked to review process, both according towards these references. a social concern (such as health impacts, to the final user of the information • Indicators measuring the processes in employment, etc.). Although the developers (internal communication vs external place and giving weight to the impact of this document recognize that social, legal communication); of these processes have been built. and economic impacts are linked, typical • The rating methodology and But while more advanced indicators environmental, economic or legal aspects framework for each social topic’s have also been designed proposing a are not measured as such within the scope indicator; quantitative assessment to report on of analysis. • Guidance to be applied in case of the consequences on the processes in This guide is meant to provide the results unavailable data and management of place, these advanced indicators are for either a social assessment for a single data quality. optional in this methodology due to the product application, or, in the future, the limits detailed above. We expect further However, as the methodology for the comparison between two (or more) product versions to allow credible assessment development of social metrics for products applications. At this stage, this guide using globally recognized advanced is still emerging, some limitations have shall not be used to make comparative indicators. been raised during the development of assertions (with regard to ISO standards this guide. They are mainly the following: • The gathering of data to perform an addressing comparative assertions) but can assessment can be time consuming be used for the comparison of products for • Suggested indicators to report the and the use of generic data exposes specific impacts within the same study. performance on each social topic— limitations in term of data accuracy. difficulties were raised in defining This guide is a significant step towards Despite the fact that we recognize indicators to illustrate the different the social impact assessment of chemical that data which are the most specific social topics as: products. It covers foundations for social to a product and most meaningful for impact and value assessment and 1. Globally recognized standards do the assessment may be privileged, provides basic requirements, notably on: not always exist; product-specific data are not always • Goal and scope, functional unit, 2. The practice of companies available. Therefore, corporate-level boundary setting; in terms of reporting social data will be used very often, notably for performance is mainly on an input/ supply chain actors. • Categories of stakeholders to be output level but generally not on an included as a basis of analysis; • The development of further case outcome/impact level studies in the years to come is needed • Social topics to be covered when (I-O-O-I method); assessing the social impact and to get more experience and understand 3. There is a lack of readily available benefits/values of one chemical the challenges of implementation. Social Life Cycle Metrics for Chemical Products | 13

2.6 How to read this guide

WBCSD working group So as to enhance readability: In addition, explanations of explanations on methodology definitions and key concepts and, The key requirements of this guide choices in this guide are presented where relevant, a summary of the are presented in . in colour boxes from the chapter grey boxes main requirements are also provided. and text in italics. Relevant examples from the The reference methodology guide chemical sector are presented in is mentioned in brackets at the end . green boxes of the quoted requirement. Definitions are presented in blue boxes.

2.7 Requirement status

In order to allow for the assessment of the SHALL: Mandatory requirement that MAY: A methodological or procedural robustness of a chemical product social must always be followed, excluding any recommendation. The issue can be ignored metrics report, all requirements from this specifically named exceptions, if any. or addressed in another way without the guide are marked as either “shall”, “should” need for any justification or explanation. SHOULD: Requirement that must be or “may” (definitions adapted from the followed. Deviations are permissible if Life Cycle Metrics for Chemical Products they are clearly justified in writing, giving (WBCSD, 2014) and the International appropriate details. Reasons for deviation Reference Life Cycle Data System can include a lack of applicability or if Handbook (Joint Research Centre, 2012)): another solution is clearly more appropriate. 14 | Social Life Cycle Metrics for Chemical Products

3 Principles

Summary This guide adopts the six principles of Life Cycle Metrics for Chemical Products (WBCSD, 2014) and Addressing the Avoided Emissions Challenge (WBCSD, 2013), consistent with the GHG Product Life Cycle Accounting and Reporting Standard (WRI/WBCSD, 2011): relevance, completeness, consistency, transparency, accuracy and feasibility. These principles guide users in the implementation of this document, especially when making choices that are not specified by this guide.

Relevance Completeness Consistency Ensure the chemical product Account for and report on all social Use consistent methodologies to allow for assessment appropriately reflects the impacts for the given functional unit meaningful comparisons of social impacts actual social impacts of the life-cycle and within the chosen inventory over time. system as much as possible and boundary. Transparently document any changes to serves the decision-making needs of Disclose and justify any specific the functional unit, applied datasets, system users—both internal and external to exclusion, define meaningful cut-off boundary, methods, or any other relevant the company. criteria. factors in the time series.

Transparency Accuracy Feasibility Address all relevant issues in a factual Ensure that the assessment of social Ensure that the chosen approach and coherent manner, based on a clear impacts within the scales is systematically can be executed within a reasonable audit trail. neither over nor under actual information timeframe and with a reasonable level on processes, as far as can be judged. of effort and cost. Disclose any relevant assumptions and make appropriate references Ensure that uncertainties are reduced as far to the accounting and calculation as practicable. methodologies and data sources used. Achieve sufficient accuracy to enable users to make decisions with reasonable assurance as to the integrity of the reported information. Social Life Cycle Metrics for Chemical Products | 15 16 | Social Life Cycle Metrics for Chemical Products

4 Key components of the assessment methodology

Summary This section describes the key components (stakeholders, overarching social areas, social topics, indicators) of the assessment methodology designed by the WBCSD Working Group on Life Cycle Metrics and explains the process followed to build up this methodology.

4.1 Stakeholder groups

All manufactured products WBCSD Social Handbook for UNEP-SETAC Product Social generate social impacts that can Metrics Impact Assessment be either positive or negative. As an impact is always linked to a Workers Workers Chain receiver (here a group of people, as we exclusively analyze the Consumers Consumers social impact), stakeholders had Community to be defined, in the same way Local communities that the Guidelines for Social Life Society Cycle Assessment of Products Along the Whole Value and Associated Works (UNEP/ SETAC, 2009) links each impact Value Chain Actors subcategory to a group of stakeholders. Figure 3: Selection of stakeholder groups Among the five groups listed by the Note: All stakeholders are considered These three stakeholders groups along the whole value chain. So workers UNEP/SETAC guidelines (see chart are the same as those selected in include workers from smallholders and below), three stakeholders groups version 2.0 of the Handbook for small and medium-sized enterprises if such were selected for this work on Product Social Impact Assessment entities are part of the product value chain social metrics: workers, consumers (PRé Sustainability, 2014). and if they are relevant to the product and local communities. studied.

DETAILS ON THE WORKING GROUP’S METHODOLOGY

Explanation of the choice of three stakeholder groups (instead of the five suggested by UNEP/SETAC): › Considering that each stakeholder group is addressed › From UNEP/SETAC, the “Society” group also at each step of the value chain, the stakeholders of the includes the following areas: public commitment to value chain actors are integrated in the three groups. sustainability issues, prevention of armed conflict, corruption, technology, contribution to economic › Likewise, the stakeholder group “Society” has been development, etc., which are not addressed in the merged with “Community” inside a stakeholder group present guide. We remind readers that economic called “Local communities”, as in version two of the areas are excluded so as to focus on social areas only Handbook for Product Social Impact Assessment (PRé (cf. section 2.5 on the scope of the current guide). Sustainability, 2014). Part of the ”Society” group is also integrated in the “Consumers” stakeholder group. Social Life Cycle Metrics for Chemical Products | 17

4.2 Overarching Social Areas To value the social impact of a its application can generate on identified and regrouped into five product application, the WBCSD the three stakeholder groups overarching areas, called “social Social Metrics Group decided to considered (workers, consumers, areas”. These overarching social identify the most relevant range local communities). Some 70 positive areas are the foundations of the social of social impacts a product and or negative social aspects were impact assessment of a product.

DEFINITIONS

1. Basic rights and needs: There are minimum rights Based on the International Labour Organization’s and entitlements within international conventions Declaration on fundamental principles and rights at that apply to all workers. Adopted in 1998, the work (ILO, 1998) and version two of the Handbook International Labour Organization (ILO) Declaration for Product Social Impact Assessment (PRé commits Member States to respect and promote Sustainability, 2014). principles and rights in four categories, whether 2. Employment: This social area assesses the role or not they have ratified the relevant Conventions. of an organization in directly affecting employment These categories are: freedom of association and by creating jobs, generating income and supplying the effective recognition of the right to collective training opportunities for community members. bargaining, the elimination of forced or compulsory Organizations can have a particularly strong effect on labor, the abolition of child labor and the elimination local community development when they hire local of discrimination in respect of employment and workers for senior management positions. This is occupation. The Declaration makes it clear that these likely to encourage open communication and trust rights are universal and that they apply to all people with the community. in all States—regardless of the level of economic development. Adapted from version 2.0 of the Handbook for Product Social Impact Assessment (PRé Organizations also contribute to meeting workers’ Sustainability, 2014) and from the Guidelines for basic needs through the implementation of fair Social Life Cycle Assessment of Products and wages, appropriate working hours, social security Associated Works (UNEP/SETAC, 2009). and benefits. 3. Health and Safety: The term health, in relation to Moreover, this social area also addresses the extent work, indicates not merely the absence of disease to which organizations respect and work to protect, or infirmity; it also includes the physical and mental to provide or to improve community access to elements affecting health, which are directly related to local material resources (i.e. water, land, mineral safety and hygiene at work. and biological resources), shelter and sanitation. Communities and organizations may share the use of material resources, especially in emerging or unstable countries. 18 | Social Life Cycle Metrics for Chemical Products

4 Key components of the assessment methodology continued

Health and safety also address the consumer’s Education and training are also key to employability, right to be protected against products that may economic growth, poverty eradication, and sustainable be hazardous to health or life. Consumers expect community development. By investing in skills and products to perform their intended functions education at the community level, companies improve satisfactorily and not pose a risk to their health and both their future workforce and the future strength and safety. Additionally, this social area addresses the stability of the economy and society in which they will positive impacts that products may have on the do business. The goal of lifelong learning is to promote health and safety of product end-users under defined the development of knowledge and competencies that conditions. will enable each citizen to adapt to a rapidly changing labor market and to participate actively in all spheres of Finally, this social area addresses how organizations economic life. impact community safety and health. This includes the general safety conditions of operations and their Consumer education is the preparation of an public health impact. With regards to general safety, individual through the skills, concepts and operations can impact community safety through understanding that are required for everyday living equipment accidents or structural failures. Project- in order to achieve maximum satisfaction and related land-use changes can also lead to natural sustainable resource use. It is defined as education disasters, such as landslides. Disease may spread given to the consumer about various consumer as a result of business-related land-use changes, for goods and services, covering price, what the example when poor water drainage contributes to consumer can expect, standard trade practice, the spread of malaria. An influx of workers can also environmental, social and economic impact of goods encourage the spread of communicable disease. and services, etc. The generation and/or use of hazardous materials Based on the International Labour Organization’s and emissions of pollution may also lead to adverse International Labour Standards on Vocational health impacts. Organizations may also contribute guidance and training (ILO, 2004). to the health and safety of local communities, for example by sharing access to worker health services. 5. Well-being: This multidimensional social area addresses how the company contributes to worker, Adapted from version 2.0 of the Handbook for Product local community and consumer well-being through Social Impact Assessment (PRé Sustainability, 2014) work-life balance satisfaction, job satisfaction, and based on ILO/ WHO definition (Occupational Safety actions with local communities, etc. The well-being and Health Recommendation, 1981 - No. 164) and the of staff is an increasingly relevant and necessary Guidelines for Social Life Cycle Assessment of Products consideration in the modern workplace. Well-being at and Associated Works (UNEP/SETAC, 2009). its simplest level is perhaps ultimately about personal 4. Skills & Knowledge: Education and training are happiness—feeling good and living safely and what make people employable, thereby allowing healthily. This means not allowing work to undermine them to gain access to decent work and create the basic purposes and workers’ needs, and by further employability of workers in a larger market. extension those of their families. In this respect, well- A more skilled and aware workforce enhances the being is a significant aspect for work and careers. organization’s human capital and contributes to Moreover, this social area also addresses the extent employee satisfaction, which correlates strongly to which organizations respect and work to protect, with improved performance. By investing in human to provide or to improve community access to resources, companies can improve productivity infrastructure (i.e. roads, sanitation facilities, schools, and compete more successfully in world markets. etc.). Organizations and communities may benefit Training benefits not only the individual worker, but by from improving the quality of local infrastructure. This increasing her or his productivity and skill level, the social area also encompasses the well-being the employer reaps the rewards as well. For those facing consumer associates with the use of a product. retirement, confidence and quality of work relations are improved by the knowledge that they will be Adapted from version 2.0 of the Handbook supported in their transition from work to retirement. for Product Social Impact Assessment (PRé The goal of lifelong learning is to promote the Sustainability, 2014) and based on the Handbook for development of knowledge and competencies that Product Social Impact Assessment (Roundtable for will enable each citizen to adapt to a rapidly changing Product Social Metrics, 2014), How’s life? Measuring labor market and to participate actively in all spheres well-being (OECD, 2013) and the Guidelines for of economic life. Social Life Cycle Assessment of Products and Associated Works (UNEP/SETAC, 2009). Social Life Cycle Metrics for Chemical Products | 19

DETAILS ON THE WORKING GROUP’S METHODOLOGY

The 70 social aspects were identified usingexisting › Nine organizations participated in the external works and databases (among which the Guidelines stakeholder survey: Goodyear; Interface; M&S; L’Oréal; for Social Life Cycle Assessment of Products and Corbion; CEPE (European council of paints, printing Associated Works (UNEP/SETAC, 2009), social life inks and artists’ colors manufacturers); Institute of cycle assessments (S-LCA) works from Greendelta (see Sustainable and Environmental Chemistry, Faculty the Greendelta website listed in the references) and the of Sustainability, Leuphana University; Wuppertal Social Hotspot database (also listed in the references)) Institute; PRé Sustainability. and through an internal and an external stakeholder They were questioned on their views/needs on product consultation: social metrics from the chemical sector and on the › Companies from the WBCSD Reaching Full Potential approach of this initiative. project answered the internal survey, with at least Then, using the stakeholder consultation results, the three business functions interviewed per company WBCSD Working Group on Life Cycle Metrics grouped (responses were received from the following business the social aspects into five overarching social areas functions: marketing; communications; innovation/ and set up clear definitions to avoid overlaps. Specific R&D; LCA/sustainability; market development; social aspects may be distributed in different social strategy; purchasing). areas. For example, business ethics topics were not defined in a dedicated social area, but distributed to the most complementary one (basic rights and needs, employment). 20 | Social Life Cycle Metrics for Chemical Products

4 Key components of the assessment methodology continued

4.3 Social topics Within the framework of social Social topics are positive or areas and stakeholders, 25 negative social impacts that may social topics were selected, occur at the various stages of the among a total of 70, as the life cycle. They were identified by most representative for each the subgroups through the analysis combination of stakeholder and of information available in existing social area. studies and databases.

DETAILS ON THE WORKING GROUP’S METHODOLOGY

Subgroups were created for each social area in order to proper sectorial expertise (not necessarily life cycle identify the most representative impacts, called “social assessment-based). topics”, that are specifically linked to the overarching Along with the external sources of information on which Social Area. These subgroups based their analysis the selection was based and the subgroup members’ on studies and databases such as the Guidelines expertise, the social topics were challenged: for Social Life Cycle Assessment of Products and Associated Works (UNEP/SETAC, 2009), version 2.0 of › Internally, through the application of certain social the Handbook for Product Social Impact Assessment topics on case studies, especially the case of PVC (PRé Sustainability, 2014), international standards pipes for water delivery in Europe; (Global Reporting Initiative, case studies from the › Externally, through expert review. hotspots database, etc.) and subgroup members’ Social Life Cycle Metrics for Chemical Products | 21

Choice of the mandatory social topics Theoretically, each product As the selection of social topics assessment carried out according application could be assessed shall reflect a comprehensive to the present guide. regarding the 25 social topics. set of social issues related to the As the “Direct impact on Nevertheless, they are not always product system being studied, basic needs” (mandatory) and material with regard to the goal this guide recommends a “Consumer’s product experience” of the assessment and social minimum set of social topics that (non-mandatory) social topics can issues of the chemical product should be covered. Therefore, only be assessed in the use phase, for a given usage. In addition, in order to reduce the workload in the case of a cradle-to-gate the assessment of a product for of product application social study the number of social topics is each of the 25 social topics would impact assessment, as well reduced to 23 and the number of increase the complexity and the as to ensure, in the future, a mandatory social topics to 10. time and resources allocated to minimum of comparability between the assessment, which would assessments, the WBCSD working make the exercise unfeasible in a group has selected the following business context. list of 11 mandatory social topics for any product application 22 | Social Life Cycle Metrics for Chemical Products

4 Content and design of the assessment methodology continued

Employment • Management of reorganization • Job creation

• Workers’ occupational health risks • Management of workers’ individual • Health and safety of local community’s • Impact on consumer health and safety Health & Safety health

SOCIAL AREAS living conditions • Safety management system for workers

Skills & Knowledge • Skills, knowledge and employability • Promotion of skills and knowledge • Promotion of skills & knowledge

Legend Mandatory social topics Additional social topics to be selected by a practitioner Figure 5: The 11 mandatory and 14 non mandatory social topics

DETAILS ON THE WORKING GROUP’S METHODOLOGY

To prioritize and select a list of mandatory social topics, working group members completed a matrix to indicate whether the social topics should be mandatory for the chemical sector based on their professional experience. The final selection of the mandatory social topics was made during a workshop. Social Life Cycle Metrics for Chemical Products | 23

4.4 Indicators

Indicators were built for each indicator (mandatory) combining Generally these advanced social topic, following the the checking of processes in place indicators are more quantitative methodology used in Guidelines to adequately address the social and based on a specific aspect for Social Life-Cycle Assessment topic considered and their impact, of the social topic. They are of Products and Associated Works and when relevant, one or more considered optional for the (UNEP/SETAC, 2009): at least one optional advanced indicators. assessment.

DEFINITIONS

Indicator: quantifiable representation of a social impact. Advanced indicator: one (or more) advanced One indicator has been designed for each of the 25 indicators have also been designed for 25 social topics. social topics. It combines the checking of processes in They are generally more quantitative and based on a place and the assessment of their impact. Indicators for specific aspect of the social topic. They are considered mandatory and additional social topics are necessarily optional for the assessment. integrated into the assessment of the product. 24 | Social Life Cycle Metrics for Chemical Products

The final objective of these normalized to a 5-level scale, indicators is to value the social ranking the indicators’ results impact of a product application. from -2 (worst social impact) For enhanced communication to +2 (greatest social benefit), and reading, and to facilitate presented in section 4.5. interpretation, and, in the future, comparability, indicators have been

EXAMPLE: SOCIAL/EMPLOYER SECURITY AND BENEFITS

Indicator: Example of a product reaching a 0 level

Social/employer X a) Policies in reporting company exist security and benefits X b) Company provides a minimum standard of social security in terms of healthcare and income security X c) Company provides access to remedy d) Company provides social security in terms of healthcare and income security (incl. old age) additional to national regulations (e.g. company pension scheme, protection, etc.) e) Suppliers are actively encouraged to achieve a,b,c,d 2 a,b,c,d,e achieved 1 a,b,c,d achieved 0 a,b,c achieved -1 a,b partially achieved -2 a,b,c,d,e not achieved

Advanced indicator: Example of a product reaching a 0 level

SOCIAL BENEFITS (INCL. SOCIAL SECURITY EXPENDITURES)

2 Description of social benefits (incl. social security expenditures) of key life cycle stages of the value chain companies is available in official reports. 1 Description of social benefits (incl. social security expenditures) of key life cycle stages of the value chain companies is partially available in official reports. 0 Description of social benefits (incl. social security expenditures) of the reporting company is available in official reports. -1 Description of social benefits (incl. social security expenditures) of the reporting company partly exists. -2 Description of social benefits (incl. social security expenditures) of the reporting company does not exist. Social Life Cycle Metrics for Chemical Products | 25

DETAILS ON THE WORKING GROUP’S METHODOLOGY

Each subgroup addressed one particular social area • Is the list of social topics complete (covering all so as to develop the social topics linked to each health and safety perspectives, covering the whole stakeholder group. Their work consisted of building the life cycle)? social topics and linking to each of them at least one • Is the definition based on current or emerging indicator able to value the social impacts of a product recognized standards? application on each stakeholder group, on the whole value chain and throughout the life cycle of a product. • Are the indicators’ definitions adaptable internationally? Strengths and weaknesses of each type of indicator have been listed. Difficulties were raised such as data • Are the indicators measurable and comparable? availability, building reference scales for advanced • Do the indicators allow comparison between indicators, and issues of “coverage” of indicators in different product applications? relation to the social topic (in some cases, several advanced indicators are needed to fully address • Do the indicators assess both negative impact the social topic). Therefore, these indicators are not and benefits? mandatory in the requirements. The decision on the • Are the indicators applicable along the whole value use of these indicators belongs to the practitioner (see chain? Any exclusion to be justified. section 5.4). Each subgroup based its investigations on existing The principles used during the creation of each social databases and global standards presented in appendix 1 topic and indicator were the following: and 2. • Is the definition of the social topicrelevant?

4.5 Assessment through reference scales The indicators will enable the Using reference scales is critical to Interpretation of scales across the valuation of each social topic ensuring that a topic is handled the value chain will touch upon sectors with the help of a scale that same way by the different users of that are beyond the chemical assesses each process or input the guide. sector. linked to the functional unit of The scales defined for each The final list of social topics, related the product application from -2 indicator (see appendix 4) were indicators, and scales, is available to +2. This reference scale is built on a chemical industry in Appendix 4. similar to the one used in version perspective, with zero or medium 2.0 of the Handbook for Product performance indicating the Social Impact Assessment (PRé industry’s benchmark. Sustainability, 2014).

2 Outstanding/ Exemplary performance

1 Good performance

0 Standard performance / compliance

-1 Inadequate performance

-2 Unacceptable performance

Unknown (default)

Figure 7: Generic reference scale 26 | Social Life Cycle Metrics for Chemical Products

5 Core methodology for social impact assessment

5.1 Goal & scope A clear definition of the chemical A clear definition of the scope will The grey box below is directly product application assessment’s focus the analysis on the intended inspired from Life Cycle Metrics goal is critical for alignment goal. for Chemical Products (WBCSD, between the results and 2014). expectations of the study.

REQUIREMENTS

Conclusions of the chemical product The chemical product application especially identify the decision application assessment shall be assessment report shall: context; consistent with the study goal. • State the intended goal and study • State the business goal clearly; Consistent with International Organization application(s) of the chemical product • Identify the target audience of the for Standardization’s (ISO) life cycle application assessment in a precise study, i.e. to whom the results assessment global standards (ISO and unambiguous way; of the study are intended to be 14040:2006 and ISO 14044:2006), the • Explain the reasons for carrying out communicated. following specific requirements are to be the chemical product application taken into account for a chemical product social metrics study, name the social metric assessment’s goal definition. drivers and motivations, and

EXAMPLE: SOCIAL/EMPLOYER SECURITY AND BENEFITS

Typical examples of intended applications • Screen (a part of) the product Typical examples of intended audience for chemical product social impact portfolio to identify hotspots, risks include internal and/or external studies include (source: version 2.0 of and improvement opportunities; stakeholders: employees, shareholders, the Handbook for Product Social Impact customers, regulators, local • Assess the impacts of a product in Assessment (PRé Sustainability, 2014, communities, society, etc. the market for internal assessment p. 22)): and optimization; Typical examples of reasons for carrying • Understand potential risks and out the study are also developed • Communicate results in a B2B improvement opportunities of a new in version 2.0 of the Handbook for context, comparing a product with product in initial development phase; Product Social Impact Assessment (PRé an alternative product or solution; Sustainability, 2014). • Understand potential risks and • Communicate the results to the improvement opportunities before general public. making the decision to start a project pilot; Social Life Cycle Metrics for Chemical Products | 27

5.2. Functional unit

A clear definition of the functional by providing a reference to which unit represents a key element social topics can be related. of the methodology, as it allows comparison of the social impact of two or more chemical products

DEFINITIONS

Functional unit: “Quantified performance of a product Reference flow: “Amount of product on which the system for use as a reference unit” (source: ISO results of the study are based” (source: GHG Product 14040:2006 and 14044:2006). Life Cycle Accounting and Reporting Standard).

REQUIREMENTS

The following requirements have to be The following three quality properties For cradle-to-grave studies, companies taken into account when defining the should be used to assess whether shall specify the duration time of a functional unit (source: Life Cycle Metrics compared solutions are truly product that contributes to the functional for Chemical Products (WBCSD, 2014)): exchangeable: unit, i.e. how long the performance of the final product or service needs to be The functional unit shall be consistent • Functionality, related to the main maintained. The chemical product social with the goal and scope of the study. function of the solution; impact assessment report shall explain As the functional unit specifies the benefit how this duration has been determined in • Technical quality, such as stability, provided to the customer, the functional relation to the lifetime of the product. durability, ease of maintenance; unit shall be equivalent for all compared Both the duration of the functional unit solutions. • Additional functions rendered during and the lifetime of the product should be use and disposal; if additional To ensure products in a comparative in line with standards used in the market functions of any of the systems chemical product social impact study are (e.g. product category rules, studies are not taken into account in the exchangeable in the selected market, from reputable organizations, studies by comparison of the functional units, relevant quality criteria should be taken leading companies in the value chain). then these omissions shall be into consideration, as much as feasible. explained and documented (source: ISO 14044:2006, §4.2.3.2.). 28 | Social Life Cycle Metrics for Chemical Products

EXAMPLES

Example 1: Assuming that a company • Reference flow: • Functional unit: wants to assess the social impacts o Cradle-to-grave: 500,000 o Cradle-to-grave: Making 1 and value of using PVC pipes for water gallons (1.89 million liters) of liter of fresh milk available for delivery in Europe, the goal and functional water/year or similar; the consumer in good sanitary unit could be the following: o Cradle-to-gate: 10 kilometers of conditions with a shelf life of two weeks; • Goal of the assessment: Social 150 mm PVC pipes. assessment of water delivering o Cradle-to-gate: Producing PE system in Europe using PVC pipes; packaging dedicated to the Example 2: To assess the social packaging of fresh milk in 1 liter • Functional unit: impacts and value of using bio-based bottles. o Cradle-to-grave: Making polyethylene (PE) for food packaging drinking water available to produced in Brazil, the goal and • Reference flow: 10,000 inhabitants over a 50- functional unit could be the following: o Cradle-to-grave: 1 liter of milk year period; or similar; • Goal of the assessment: Social o Producing pipes o Cradle-to-gate: 1 bio-based PE Cradle-to-gate: assessment of milk sold in the dedicated to water delivery with bottle of 1 liter capacity. USA in 2015 using bio-based PE a service life of 50 years. packaging produced in Brazil;

5.3. Selection of social topics for a specific product assessment The objective is to select of this all chemical products have already section is to select social topics been identified. In addition, other that are particularly relevant for relevant social topics could be the assessment performed and selected within the scope of the consistent with the goal of the assessment. study. Mandatory social topics for

MANDATORY SOCIAL TOPICS

11 MANDATORY 14 NON-MANDATORY Core social topics Others social topics

Selection of additional social topics particularly relevant for the product assessed

Report Mandatory Report additional Social Topics Social Topics

Mandatory social topics’ Additional social topics’ indicators (+opticonal indicators (+opticonal advanced indicators) advanced indicators)

Figure 8: Selection of social topics and associated indicators Social Life Cycle Metrics for Chemical Products | 29

REQUIREMENTS

• For an absolute product • Non-material social topics may also • For most social assessment application’s social impact be included in the assessment. studies, existing social topics and assessment: the corresponding indicators will • For a social impact comparison be selected. However, in some o The 11 mandatory social topics between comparable product cases existing social topics and shall be included in the social applications, the selection of the corresponding indicators are impact assessment (see section additional social topics be shall not sufficient to fulfil the defined 4.3); conducted as described above for goal and scope of the study and o A practitioner select each product application; and all shall new ones have to be defined. additional impacts within the 14 social topics that have been selected When new social topics and the non-mandatory social topics to for both product applications shall corresponding indicators are be added to the assessment be included in the social impact defined, it shall be clearly stated based on their particular comparison. This requirement and the requirements described in relevance and justify their choice; anticipates future versions of this the present guide shall be applied guide, because at its actual stage o Note: The grouping of the 11 (see sections 3, 4 and 5.5). mandatory social topics and of development, this guide does not the additional non-mandatory encourage comparative assertions social topics that are considered between product applications. as particularly relevant for the • The selection of social topics shall product application studied form reflect a comprehensive set of social the list of material social topics. issues related to the product system being studied and be both justified and consistent with the goal and scope of the social evaluation.

EXAMPLES OF SELECTING NON-MANDATORY SOCIAL TOPICS

Selection of additional14 NON-MANDATORYsocial topics forSOCIAL the TOPICS PVC and the bio-based PE Ccases:ASE N°1 CASE N°2 PRODUCTION OF PVC PIPES FOR WATER DELIVERY IN BIO-BASED PE FOR FOOD PACKAGING EUROPE CASE PRODUCED IN BRAZIL (ENERGY COMING FROM RUSSIA)

Workers Management of worker’s individual health Appropriate working hours Material because of a risk identified in the country where it is produced No discrimination Material because of a risk identified in the country where it is produced Social/employer security and benefits Material because of a risk identified in the country where it is produced Job satisfaction Management of reorganization

Local Access to basic needs for sustainable development communities (infrastructure, ICT, modern energy) Respect for indigenous rights Material because of the attention brought by the media on deforestation Nuisance reduction Developing relationship with local communities Material because local communities invest money for PVC pipe installation, so they have strong expectations Promotion of skills & knowledge

Consumers Consumer’s product experience Direct impact on basic needs Material for the PVC because of the societal function Material because of the societal function of the of the product, which is to make water available for the product population Promotion of skills & knowledge 2 additional social topics to be added to the assessment 5 additional social topics to be added to the assessment

Figure 9: Overview of the selection of additional social topics to integrate in the assessment for the PVC pipes and bio-based PE packaging cases 30 | Social Life Cycle Metrics for Chemical Products

5.4. Choice of indicators and advanced indicators As described in section 4.4, for each social topic one ‘indicator’ and at least one ‘advanced indicator’ have been developed.

REQUIREMENTS

Choice of indicators: Assessment of indicators: For advanced indicators, as they are not At each relevant life cycle stage Results of the assessment for each compulsory, they: (determined by the setting of indicator be expressed in numerical shall • Should be assessed in numerical boundaries through a practitioner format (from -2 to +2), according to format (from -2 to +2), according to analysis, see section 5.6) and for one of the reference scales defined in a reference scale; each selected social topic (mandatory Appendix 4. and additional material social topics, OR see section 5.3), the assessment • May be published in quantitative shall include, at a minimum, the main format only, without the -2 /+2 indicators. One or several advanced scale. indicators may be included as well.

5.5. Setting up reference scales for indicators and advanced indicators In the current version of this guide, but first indications on what kind Further guidance on how to set a reference scale has been defined of reference scale could be used up a reference scale is developed for every indicator. For advanced are given in Appendix 4. Therefore, in version 2.0 of the Handbook for indicators, in the current version of this section is about setting up Product Social Impact Assessment this guide, a reference scale has reference scales that are specific (PRé Sustainability, 2014, p.13-16) been developed for each social to a given advanced indicator. A and in “Socioeconomic LCA of Milk topic. However, due to a lack of reference scale is needed to set a Production in Canada” (Revéret et data, such scales have not been limit—when a product should get, al., 2015). defined for all advanced indicators for example, a level 0 or a level +2.

REQUIREMENTS

Reference scaling shall be defined based • Another benchmark representative Scaling shall be done according to on sectorial information, such as: of industry, national or international recognized data such as sector averages, regulations; databases, expert’s investigations. • The industry average; • Best available technologies or • An alternative average (for example standards. of the main actors of the industry); Social Life Cycle Metrics for Chemical Products | 31

EXAMPLES

1. Advanced indicator: Reference 2. Advanced indicator: Reference 1. Indicator: Reference based on based on expert investigations based on the average sector level expert investigations For the social area “Employment”, For the social area “Health & For the social area “Health & safety”, the “Total number of jobs” advanced safety”, the advanced indicator the main indicator linked to the indicator linked to the social topic “Absenteeism rate” linked to the stakeholder group “Consumers” “Job creation” is referred to a stakeholder group “Workers” and and the social topic “Impact on reference of 2% originating from the social topic “Safety management consumer health & safety” will expert investigations. For example, system” considers the average consider product application a company activity (linked to the sector level as a reference. As such, performance with respect to functional unit of the product if the level of absenteeism exceeds usual policies and practices in application) that increased the the sector average, the company’s place that have been listed by amount of jobs by more than 2% score (linked to the functional unit expert investigations. As such, if compared to the previous year of the product application) will lie the product increases the risk of will receive a score of +2 on this between -2 and -1. disease, accident or injury, the indicator. product application performance will be rated at -2.

Methodology to set up a reference scale “Generic reference scales” have Hence, advanced indicators, when been designed for the assessment included in the analysis and when of advanced indicators and are data are available, may need a more available in appendix 4. specific reference scale based on a generic reference scale. 32 | Social Life Cycle Metrics for Chemical Products

5.6. Boundary setting While this guide is applicable complex studies with little marginal Specific cut-off rules, which are to products (as opposed to relevance. This step prioritizes clearly defined in an assessment, companies), the analysis of each and selects the life cycle stages can be applied and the most indicator at each life cycle stage to be included in the social impact significant life cycle steps will be for the selected social topics assessment because of the social assessed. would lead to time-consuming and risks they may have.

DEFINITIONS

Cradle-to-grave LCA: Addresses the social aspects Cradle-to-gate study: Addresses the social aspects and potential social impacts (e.g. use of workforce and potential social impacts (e.g. use of workforce and consequences for job creation/destruction) in and consequences for job creation/destruction) a product’s life cycle, from raw material acquisition throughout, from raw material acquisition to the point through production, use, end-of-life treatment, at which it leaves the factory gate (i.e. excluding recycling and final disposal (ISO 14040:2006 and transport to use location, use and end-of-life). 14044:2006).

Raw material Upstream Manufacturer Downstream Final use End of life acquisition suppliers customers

Cradle-to-gate Cradle-to-gavre

Figure 10: Life cycle stages and scope of cradle-to-grave and cradle-to-gate assessments Social Life Cycle Metrics for Chemical Products | 33

REQUIREMENTS

The social impact assessment of a that comparability of the chemical 2. When the stage is a chemical product application: product social impact with other producer with a significant products may not be relevant and impact on the results of the be adapted to the goal and • Shall might lead to incorrect conclusions. study of the product, it be scope shall Furthermore, by adopting the included; an iterative approach The goal and scope are defined at cradle-to-gate assessment, some might be needed to define it; the very beginning of the analysis stakeholders and linked social topics 3. All the life cycle stages identified and cover the product and its will not be covered, which will lead to as risky be included in the application. shall a different social impact assessment. social assessment; For example, in a cradle-to-gate 4. The justification of selection of study, the health and safety of a the key life cycle stages • Should cover the whole life cycle, product cannot be assessed from a shall be provided, as well as the down to the use and end-of-life of consumer point of view. the product. justification of exclusion. • Should be focused on a selection of The value chain will always key life cycle stages. In that case, the (excepting for specific cases) cover requirements are the following: the value chain from cradle-to-grave. 1. The selection of key life cycle A specific limitation statement and stages shall be performed by the description of the cut-off rules answering key questions and, applied shall be included in the when necessary, may rely chemical product social impact study on risk filter criteria, listed in report in order to inform the reader Appendix 5;

DEFINITION OF THE GOAL AND SCOPE OF THE STUDY

Setting boundaries

All value chain steps

Practitioner assessement of each value chain steps for all impact categories

Select key lifecycle stages

Selection of players representative of the key lifecycle steps

Figure 11: Overview of life cycle stage selection process 34 | Social Life Cycle Metrics for Chemical Products

Methodology to identify key life cycle stages In order to select the key life cycle also using the sources of information stages to integrate in a product listed in Appendix 1. The questions assessment, an analysis will be will be addressed for each life cycle conducted, first by addressing stage of the product application. several questions (see below) to Every mandatory and additional an industry expert who will answer material social topic will also be according to his/her expertise, and considered.

Key questions to be considered by the industry expert are:

• Is this life cycle stage relevant for the functional unit and to the goal of the study in terms of mass, working hours, business importance, etc.? • Are there identified risks linked to the geographical location of the product? Is it produced in a country with past known international human rights violations or other significant negative impacts on social topics? • What are the usual actors of this life cycle stage (e.g. multinational or small companies, many actors in the market or few)? Does the company’s structure (size, number of subcontractors and suppliers, etc.) present specific risks? • Is there evidence of social violations and risk situations at this stage of the value chain? • Are significant benefits induced by the life cycle stage? • Are there specific hazards due to the activity, considering the mandatory and additional social topics included in the assessment? • Is the life cycle stage mainly determined by a chemical product’s function?

CHEMICAL COMPANY’S UPSTREAM DOWNSTREAM USE PHASE END OF LIFE OWN OPERATION Life cycle stages LC1 LC2 … LC1 LC2 ... LC1 ... LC1 Details on the life cycle stage location Key questions Is there evidence of social violations and risk situations at this stage in the value chain?

Are there specific benefits during this life cycle stage?

Is this life cycle stage relevant to the functional unit and to the goal of the study (in term of mass, business Automatically included importance, etc.) in the assessment as it concerns the company’s Is it produced in a country with known international human own operations rights violations or social risks pointed out by media? Are there specific risk resulting from the company’s structure & organization? Are there specific hazards due to the activity considering the impact categories? Conclusion

Figure 12: Example of table to be used for setting boundaries Social Life Cycle Metrics for Chemical Products | 35

In case the data available do not compliance level. Life cycle stages The choice of key representative allow for the evaluation of the life not meeting these filter criteria actors for the selected key life cycle cycle step’s risk, a filter-based will be included in the product stages is developed later within the assessment can be applied to the application assessment. data gathering section (see section life cycle stages targeted. Appendix 5.7.2.). 5 defines the filter criteria for each social topic corresponding to the

EXAMPLES

The PVC pipe manufacturing life cycle stages are the following:

Figure 13: Overview of the key stages along the PVC pipe production value chain

Note: Sodium hydroxide (NaOH) and hydrogen are co-products of chlorine at the chlorine production stage. Both uses are in a separate stage that would be included in studies with a different focus (and not in this PVC study). 36 | Social Life Cycle Metrics for Chemical Products

The selection of key life cycle stages is based on the following justifications:

UPSTREAM CHEMICAL COMPANY’S OWN OPERATIONS Life cycle stages Oil extraction Refining of NaCl Additives (colorants, Ethylene, chlorine, VC, PVC naphtha manufacturing pigments, production anti-oxidants) manufacturing Details on the life cycle stage location North Sea (40%) and Europe Europe Europe Venezuela (60%) Key questions Is there evidence of social violations and situations of risk No No No No at this stage in the value chain? Are there specific benefits during this life cycle stage? No No No No Is this life cycle stage relevant to the functional unit Yes Yes No (not significant No (up to 5% in mass and to the goal of the study (in term of mass, business in term of mass) maximum) importance, etc.) Automatically included in the Does this life cycle stage occur in a country with known Yes, Venezuela No No Europe, highly assessment as it concerns the international human rights violations or social risks? regulated company’s own operations Are there specific risks resulting from the company’s Multinational companies Multinational Multinational No structure & organization? companies companies Are there specific hazards due to the activity considering Yes, subcontractors in No No No the impact categories? the oil sector, with higher exposure to labor issues Conclusion Key life cycle stage Key life cycle Not included in Not included in the Key life cycle stage stage the assessment assessment

DOWNSTREAM USE PHASE End of life Life cycle stages Pipe manufacturing Concrete Pipe installation Steel Electricity Maintenance PVC pipe waste production production of pumps management for pumps Details on the life cycle Spain Europe France stage location Key questions Is there evidence of social violations and No No No No situations of risk at this stage in the value chain? Are there specific benefits during this life cycle No No No No stage? Is this life cycle stage relevant to the functional Yes No (not Yes Yes unit and to the goal of the study (in term of essential mass, business importance, etc.) considering the functional unit) Is it produced in a country with known No No No No international human rights violations or social risks pointed out by media? Are there specific risks resulting from the Large number of No Large number of No company’s structure & organization? companies, compliance companies, compliance management is difficult management is difficult Are there specific hazards due to the activity Yes, with high energy No Use of solvents to When incinerated, considering the impact categories? demand and potential connect pipes (risk in could have impact social hazard term of health & safety) on health due to air emissions coming from the use of additives Conclusion Key life cycle stage Not included Key life cycle stage Not included Not included Not included Key life cycle stage in the in the in the in the assessment assessment assessment assessment

Figure 14: Justification of the key life cycle stages selection Regarding the use phase, several interpretations of what should be assessed are possible: • Assessment of the impact of the use of the product on stakeholders in its production system (eg. The potable water production system contributes to improve living standard of communities) • Or assessment of the impact of the technical function of the chemical product within its working environment (eg. the impact of maintenance of the PVC pipes on the consumers). Within the PVC pipes case study the second option was chosen. Social Life Cycle Metrics for Chemical Products | 37

5.7. Data collection The main difficulty when the availability of information (and (PRé Sustainability, 2014, p.10) performing a social impact affordability of data collection), “poor data quality compromises assessment will be the collection of and on the scope/functional unit the quality and reliability of data. As such, performing a social of the product application to the assessment and leads to impact assessment is not only be assessed. This decision will uncertainty about the results” and about following a methodology have a direct consequence on can lead to wrong conclusions/ but also about deciding on the the reliability of the assessment interpretations for life cycle (5.7.1) type of data sources (origin) results. Indeed, as stated in assessment results. and the (5.7.2) gathering level version 2.0 of the Handbook for (location) of data, depending on Product Social Impact Assessment

Types of data sources

DEFINITIONS IN THIS GUIDELINE:2

Primary data: Data from specific operations in the Secondary data: Process data that are not from studied product’s life cycle. specific processes in the studied product’s life cycle.*

*The use of secondary data provides challenges for aggregation and/or comparison due to the use of different definitions and different units of analysis.

REQUIREMENTS

The data used for the assessment shall The sources of secondary data to be The above list may also be used as be as representative as possible of the used should be based on the following an order of choice to be used for product. Data for processes specific to list of source categories: default selection of secondary data the product assessed are preferable to • Life cycle inventory (LCI) that are not critical to the product company-level data if the product does datasets from recognized social metrics assessment results. not mobilize all the company’s processes. sources:

For primary data: o Industry average data published For all secondary data, specific by associations or federations; attention has to be paid to the The most accurate and available primary choices, quality and methodology data be used. Any use of secondary o Results of studies published in shall underlying these datasets. The data when primary data of good quality the literature; inherent assumptions are available be justified. o Generic databases. shall shall be carefully considered by the • Proxy data; For secondary data: practitioner before using the data. • Technical literature. Allocation approaches used (if Quality of secondary data (including any), cut-off, data gaps (lack of or supplier data) be assessed shall incomplete emissions data, etc.) according to the criteria specified in be reported. section 5.8. should

2 These definitions are different from UNEP/SETAC life cycle inventory guidance and from product environmental footprint (PEF) methodology. 38 | Social Life Cycle Metrics for Chemical Products

EXAMPLES

Examples of data that can be used • User groups—industry A list of generic databases is for each type of data quality can be: associations, supplier provided in the appendixes of the data surveys (Ecovadis), UNEP/SETAC Guidelines for Social • Primary data—data collected benchmarking studies; Life Cycle Assessment of Products through surveys for the specific and Associated Works. assessment; • Generic average data—based on statistics (from industry • Secondary data—public data, average or major company such as annual or sustainability players), social hotspots reports, Carbon Disclosure database, the Organisation Project (CDP) disclosures, for Economic Co-operation publications; and Development (OECD) databases, others.

Data gathering levels

Data can be available at different levels within a company: product, site or corporate level.

REQUIREMENTS

Most product/application-specific • If data are not available at • Unavailable data shall be information shall be provided for the product level, by default site/ treated as described in section assessment: corporate-level information 6.1 on uncertainties and limits • If data are available at product should be used and allocated of the results. level, they shall be used for the to the functional unit; assessment; Social Life Cycle Metrics for Chemical Products | 39

PVC CASE STUDY EXAMPLE

Using the same hypotheses and information described in section 5.6 for the PVC (pipes for water delivery in Europe) case study, the following assessment was made on the level of data used for the PVC product application assessment:

UPSTREAM COMPANY’S OWN OPERATIONS DOWNSTREAM END OF LIFE

Key life cycle stages (resulting from the Oil extraction Refining of naphta Chlorine, ethylene, VC and PVC Pipe manufacturing Pipe installation PVC pipe waste hotspot analysis) manufacturing management Source of information Tier 2 Tier 1 Company’s own sites Customers Installation End of life Operating country North Sea (40%) and Venezuela Europe Europe Spain France France (60%) Assumption of Ex: for the key Key actors (Norway); country Key actors Key actors Key actors Key actors Key actors source of infor- actor, identify public specific information (Venezuela) To complete To complete mation complaints (in media), search for information from the main plant…

Data gathering level Ex: main suppliers Country-specific data Company specific data Company specific data Sector specific data Company specific Company specific data (Gazprom, Total, data Shell, etc.): database, surveys, audits

Ex: company-specific

Ex: generic data (industry, sector, etc.)

Databases: LtO questions (TFS), IPIECA & OGP (oil industry)

Estimated time Give: deadlines and 2.5 h, 1 person (for the 3 indicators 2.5 h, 1 person (for the 3 2.5 h, 1 person (for the 3 indicators 1.5 h, 1 person (for 0.5 h, 1 person (for 0.5 h, 1 person (for (hrs) and resources real time estimation below in grey) indicators below in grey) below in grey) the 3 indicators below the 3 indicators below the 3 indicators below (people) needed Expertise needed (ex in grey) in grey) in grey) LCA practitioner, etc.)

Fair wages indicator Indicators result -1 1 2 1 1 Data quality 3 2 1 2 2 2

Figure 15: Example of analysis of data gathering levels for the “Fair wages” social topic

How to make choices where different sources could be used The following requirements detail how to prioritize data gathering:

• Choice between different • In case of several stage. suppliers or customers: The representative actors: A • Worst case performances practitioner select the weighted average, based on should should be specifically most representative suppliers market share or volume criteria, mentioned. or customers linked to the goal should be used to combine of the study (based on mass data from several key actors criteria for instance). identified for a single life cycle

EXAMPLES

• Example 1: End of life of PVC pipes • Example 2: Case of Supplier A, • Example 3: Natural gas provided in Europe rated -2 and representing 40% of from Russia and from the Middle supplies in mass and Supplier B, East The selection of representative rated +2, 60% of supplies in mass actors was based on the European Use generic regional data and market share for PVC recovery The weighted average result is combine the data using a weighted and waste management (including close to 0. However, a comment average, considering the share landfilling and incineration). should be provided with the result of natural gas coming from each to draw attention to the -2 score for region. Supplier A. 40 | Social Life Cycle Metrics for Chemical Products

REQUIREMENTS

• For advanced indicators consider what is dedicated to cycle assessment should be reported without a reference the functional unit (e.g. based followed for allocation issues scale and in the case of on working hours or production between different by-products. different activities performed ratios in volume or in value). by the same employees: A pro • The hierarchy suggested in the rata formula should be used to ISO 14040 Standard on life

EXAMPLES

• Example 1: During a year, an • Example 3: Assessment of the • Example 4: It is important to find employee works 1,000 hours accident frequency rate (result meaningful relationships for the producing PVC and 700 hours of the total number of accidents underlying data to have statistical producing another product, and divided by the total number of relevance. The accident frequency has received 48 hours of training. working hours). The total number of rate of the operation vessel per We should consider 48*1000/1700 accidents has to be as specific as month is not significant compared = 28 hours only for the assessment. possible to the product or product to the accident frequency rate of a class assessed, but the total site in a five-year average. • Example 2: The impacts linked to number of working hours can be the energy consumed to produce allocated to the product based on PVC and chlorine by the same volumes produced by a factory. industrial process has to be allocated using meaningful physical pro-rata criteria.

5.8. Data quality assessment Version 2.0 of the Handbook for 1 to 5 (1 being high quality and Product Social Impact Assessment 5 being poor quality). It helps (PRé Sustainability, 2014, p.11) determine the right level of data has built the following data quality quality so as to ensure reliability of matrix based on a scale that information and to transparently quantifies the quality of data from identify all the uncertainty zones. Social Life Cycle Metrics for Chemical Products | 41

REQUIREMENTS

To ensure clarity and transparency, data The quality of all data shall be assessed quality shall be provided in addition using the criteria in the following table. to the aggregated results (if any, see section 6.2).

CRITERIA SCORE 1 2 3 4 5 Own operations Independent Non-verified Non-verified data Qualified estimate Non-qualified and direct suppliers 3rd party internal partly based on estimate, verified data data with assumptions, provided with documentation, Accuracy, integrity, documentation or verified data or data based (e.g. by an or unknown source and validity partly based on on grey scientific internal or assumptions report external expert), or data based on non-scientific report Other value-chain Data obtained Data obtained Data obtained Data obtained Unknown source actors from value-chain from value- from other from literature actor directly chain actor value-chain and provided directly with actors with poor with 3rd party documentation or incomplete documentation documentation Timelines Data from Data from pre- Data from 2 years Data from 3 Data from more current reporting vious reporting before reporting years before than 3 years before period period period reporting period reporting period, or unknown age of data Correlation Data from Data from other Data from relevant Data from other Average sector or specific site sites of the sites of the companies in country data from under study company in the company in other same region with public or 3rd party same region regions similar production database provider conditions

Figure 16: Data quality matrix (source: The Handbook for Product Social Impact Assessment, v. 2.0 (PRé Sustainability, 2014, p.11))

In case none of the sources of Data quality shall be provided in addition as to the data quality. The final results of information is available (primary, to the aggregated results. all the indicators may still be eligible for secondary, user group, generic), the aggregation. grade “unknown” shall be given for the In case the scales, or some elements of indicator and a grade of “5” (worst case) the scales, appear to be irrelevant or not shall be given to the data quality. The applicable to some steps of the value final results of all the indicators may still chain, the grade “not applicable” shall be eligible for aggregation. be given to the indicator’s score, as well

Appendix 2 lists the main databases that can be used when performing a social assessment. 42 | Social Life Cycle Metrics for Chemical Products

EXAMPLES

Example 1: Assessment of a product for • Data come from the current The data quality score for the indicator the social topic “Fair wages”, with data reporting period; of this social topic is: presenting the following characteristics: • Data concern the specific site under • Data are verified by an independent study. 3rd party;

Accuracy, integrity Timelines Correlation Data quality score and validity

Product score 1 1 1 1

Example 2: Assessment of a product • There are non-verified internal data • The data concern relevant sites of for the advanced indicator “Frequency with documentation; the company in other regions. rate of safety incidents” of the social • These data come from 2 years topic “Safety management system for before the assessment period; workers”:

The data quality score for this advanced indicator is:

Accuracy, integrity Timelines Correlation Data quality score and validity

Product score 2 3 3 3 Social Life Cycle Metrics for Chemical Products | 43 44 | Social Life Cycle Metrics for Chemical Products

6 Interpretation & communication of results

6.1. Uncertainties and limits of results Though theoretically we would lower quality data can be linked time, expertise, financial). In any expect a social impact assessment to the source of information (e.g. case, even though data quality is to use product-level data with regulations that do not require rated 1, it may still include limits a quality rating of 1, data can collection of that data or do not that should be announced in line sometimes be of low quality or make it publicly available) or to with the results. even unavailable. The reasons for the lack of internal resources (e.g.

REQUIREMENTS

• Limits of the assessment shall be of the significant inputs, outputs and and a methodology that has provided and clearly identified when methodological choices in order to been decided on using other communicating the results of the understand the uncertainty of the sources of information, every product application assessment. results. (Source: Adapted from the assessment should be provided ISO 14044 standard) with a transparent description of • The results of the assessment shall the methodological and data quality be interpreted according to the • As every product application limitations. goal and scope of the study, and assessment is based on case- the interpretation should include an by-case expert judgment, data assessment and a sensitivity check with a certain level of quality,

EXAMPLES

Examples of limitations on the PVC case 2. Limitations on data quality: For the end-of-life stage, data have 1. Limitations on the scope of the been collected on a hypothetical analysis: The assessment is based 30%/30%/40% basis for the main on a key life cycle stages analysis. As actors for each sector (recycling with such, some significant life cycle steps VEKA, incineration and landfilling with might have been skipped due to an Veolia). initial screening with limited data and time resources; Social Life Cycle Metrics for Chemical Products | 45

6.2. Aggregation (optional) As the assessment is led for a risk of misinterpretation and/or So, at this stage of the social several life cycle stages of a reduction in the transparency of the assessment methodology’s product application and for at results. Furthermore, companies development, and in the absence least 11 social topics, aggregation might see these aggregated results of a robust aggregation approach, can be seen as a way to facilitate as an easy solution to compare the WBCSD working group the communication of the results product applications, which the members recommend to address of the assessment to external methodology does not allow at this this step with particular caution, stakeholders and facilitate their stage. always presenting detailed results understanding by non-experts. along with aggregated results, and However, aggregating results can to keep aggregation optional. be time-consuming and presents

REQUIREMENTS

When aggregation is chosen, the • Transparency: Stakeholders shall be • Credibility: The methodology shall process shall respect the following able to disaggregate if they want to be sufficiently detailed. principles: further analyze a specific stage of • Consistency: The results shall be the value chain or a social topic in • Clarity: Aggregation be consistent with the goal and scope shall particular; achieved at a level understood by of the assessment. stakeholders; 46 | Social Life Cycle Metrics for Chemical Products

Value chain

downstream Upstream Life cycle stage State 1 State 2 State 3 State 4 State 5 Social assessment score 0 2 -1 -1 1

Simple average: Each activity on the value chain has the same importance/weight 20% 20% 20% 20% 20%

Aggregated result for the indicator 0*20%+2*20%-1*20%-1*20%+1*20%= along the whole value chain 0.2 Figure 17: Example of aggregation along the value chain Note: Simple average is used here as an illustration because it is the most straightforward.

REQUIREMENTS

Once all actors along the value chain • The worst cases (-2) shall still • As described in section 5.8, so as have been assessed on the indicator for be flagged in addition to the to ensure clarity and transparency, each social topic: aggregated result; data quality shall be provided in addition to the aggregated result. • These values should be aggregated along the life cycle stages with a simple average;

EXAMPLES FROM THE PVC PIPES CASE

Example of aggregated results for the “Fair wages” social topic from the PVC pipes case study

UPSTREAM COMPANY’S OWN DOWNSTREAM END OF LIFE AGGREGATED RESULTS OPERATIONS Oil extraction Refining of naphta Chlorine, ethylene, VC Pipe manufacturing Pipe installation PVC pipe waste Product Key life cycle stages (resulting from Flag the worst case Data Quality the hotspot analysis) and PVC manufacturing management Performance Source of information Tier 2 Tier 1 Company’s own sites Customers Installation End of life Operating country North Sea (40%) and Europe Europe Spain France France Venezuela (60%) Assumption Ex: for the key Key actors (Norway); Key actors Key actors Key actors Key actors Key actors of source of actor, identify country specific To complete To complete information public complaints information (Venezuela) (in media), search for information from the main plant… Data gathering Ex: main suppliers Country-specific data Company specific data Company specific data Sector specific data Company specific Company specific level (Gazprom, Total, data data Shell, etc.): database, surveys, audits Ex: company- specific Ex: generic data (industry, sector, etc.) Databases: LtO questions (TFS), IPIECA & OGP (oil industry) Estimated Give: deadlines 2.5 h, 1 person (for the 2.5 h, 1 person (for the 2.5 h, 1 person (for the 3 1.5 h, 1 person (for 0.5 h, 1 person 0.5 h, 1 person time (hrs) and and real time 3 indicators below 3 indicators below indicators below in grey) the 3 indicators (for the 3 indica- (for the 3 resources estimation in grey) in grey) below in grey) tors below in grey) indicators below (people) needed Expertise in grey) needed (ex LCA practitioner, etc.)

Fair wages Indicators result -1 1 2 1 1 0.67 N/A 1.5 indicator Data quality 3 2 1 2 2 2

Figure 18: Example of aggregation of the “Fair wages” indicator score for the PVC case study Social Life Cycle Metrics for Chemical Products | 47

Aggregation across social topics

DEFINITIONS

Aggregation across social topics is the aggregation category or for all stakeholder categories, grouping all of all indicators (indicator and advanced indicators), indicators studied. either for a social topic or a social area or a stakeholder

REQUIREMENTS

• Once all social topics have been • However, when using aggregation assessed through their respective across social topics, all indicators for each product requirements from version 2.0 of the application, aggregation across Handbook for Product Social Impact social topics may be performed. Assessment (PRé Sustainability, 2014) shall be implemented.

Figure 19: Aggregation across social topics 48 | Social Life Cycle Metrics for Chemical Products

6.3. Interpretation of the results As an illustration, the following The graph indicates the communication format could be aggregated results of the used to present the key results of assessment: the performance the assessment, assuming that of the product and the quality of one graph would be presented for the data used to evaluate this each stakeholder category. performance.

Figure 20: Example of presentation of aggregated results

This figure has only been each mandatory and additional their importance; they are only due designed to suggest an example social topic selected for the to the fact that some social areas of communication of the results assessment. Its goal is to provide contain more social topics than of the assessment. It shows the a quick view of the results for each others. results of a product application for stakeholder group. The widths each stakeholder group and on of the social topics do not reflect

6.4. Peer review

REQUIREMENTS

• Peer review of chemical product • In the case of external publication, • A chemical product application application reports to external an external critical review by a panel report that was peer reviewed stakeholders may be conducted of LCA experts may be performed shall include a statement clearly to assess their consistency with prior to publication. In such a case, specifying that the study has been this guide. the external peer review should peer reviewed and summarizing the be based on the ISO 14040/44 conclusions of that review. standard.

Particular attention has to be • Selection of additional material data used and data quality paid to some crucial steps of the social topics (section 5.3 ); assessment; methodology and information • Boundary setting and selection • Transparency in the results and reported on this methodology: of key life cycle stages (section their interpretation (shall be • Description of the goal and 5.6); linked to the goal and scope); scope of the assessment; • Assumptions made for • Limits of the assessment. data gathering, sources of Social Life Cycle Metrics for Chemical Products | 49

6.5. Communication of results Methodologies for assessing dedicated to the chemical sector. This section of the report aims at products’ social impact As for any new methodology, guiding the users on how they can

assessment are very new and still users have to be cautious while communicate the results of their } under development. As detailed communicating the results in product application’s assessment. previously, this methodology is the order to inform the readers of the first social metrics methodology potential limits of these results.

REQUIREMENTS

According to the ISO 14044 report shall also allow the results and An example of such a warning standard’s General Requirements and interpretation to be used in a manner could say “the current report follows Considerations for Reporting (section 5.1): consistent with the goals of the study.” a methodology that is still under development and some caution is “The results and conclusions of Any communication of the results needed while interpreting the results the LCA be completely and and conclusions of a project using shall and making conclusions based on the accurately reported without bias to the the social metrics methodology shall study.” intended audience. The results, data, include a warning on the limitations methods, assumptions and limitations of quantifying social impacts, due to Results should be communicated shall be transparent and presented the novelty of this approach, which (internally and externally) using the in sufficient detail to allow the reader necessarily implies additional caution template suggested in Appendix 6. to comprehend the complexities and while reading and using the results. trade-offs inherent in the LCA. The

How to use the results This methodology can be used for several reasons, such as the following examples.

EXAMPLES FROM THE PVC PIPES CASE

Application examples presented • Assess the impact of a product in the • Improve communication and in version 2.0 of the Handbook for market for internal assessment and reporting: Product Social Impact Assessment optimization; o Inform business partners (PRé Sustainability, 2014) and in the • Identify social issues along the value about product and value chain GHG Corporate Value Chain (Scope 3) chain; characteristics; Accounting and Reporting Standard: • Screen (a part of) the product o Communicate the results to the • Understand potential risks and portfolio to identify hotspots, risks and general public to provide them improvement opportunities of a new improvement opportunities; with the key information to make product in the initial development better purchasing decisions. phase; • Manage and reduce regulatory risks; • Understand potential risks and • Improve the product and/or improvement opportunities before company’s reputation; making the decision to start a project pilot; 50 | Social Life Cycle Metrics for Chemical Products

7 Outlook

This guide is a first approach • Additional user-oriented • Implementation schemes for the chemical sector towards features such as a checklist for the decision-making setting the foundations to assess for quality assessment, a processes of chemicals and report the social impacts of template for data collection, industries, in particular chemical products along their and/or an extended to move towards the value chain. Further challenges that description of best practices; combination of social and are not fully covered in this guide environmental LCA; • Development of rules and may be addressed in future phases guidance to allow comparative • Definition of additional of the WBCSD chemical sector studies within the social indicators to address regional project in the years to come, metrics methodology; or cultural specificities; notably the following: • Development of a common • Completion of pilot studies. • Development of more knowledge base gathering accurate advanced indicators, relevant information, e.g. as well as a reference scale literature, contacts, especially The next refinement opportunity for each advanced indicator for the definition of industry for these metrics will be to share (particularly concerning the averages; practices and communicate results notion of “partially achieved” during an implementation phase. • Identification of relevant data for -1 and +1 levels); Sharing and discussions with sources and development of • Development of a more existing initiatives will be ongoing databases; detailed communication to build more consistency across template; • Guidance for data aggregation the different approaches. and single scoring of results; Social Life Cycle Metrics for Chemical Products | 51 52 | Social Life Cycle Metrics for Chemical Products

8 Appendices

Appendix 1. Bibliography and references Reports ILO (2010). A Skilled Workforce for Strong, Sustainable and Balanced Growth: A G20 Training BASF (2014). Sustainability Evaluation and Social Strategy. International Labor Office. LCA at BASF. Joint Research Centre (2012). International Reference Chhipi-Shrestha, G. K., K. Hewage, R. Sadiq (2014) Life Cycle Data System Handbook. “‘Socializing’” sustainability: a critical review on current development status of social life cycle impact New Earth & The sustainability consortium (2011). assessment method”. Clean Technologies and Social scoping report, Strawberry yogurt. Environmental Policy 17 (3), 579-596. New Earth & The sustainability consortium (2011). Ciroth, Andreas, Juliane Franze (2011). LCA of an Social scoping report, Orange juice. Ecolabelled Notebook, Consideration of Social and OECD (2013). How’s life? Measuring well-being. Environmental Impacts along the Entire Life Cycle. Organisation for Economic Co-operation and GreenDeltaTC GmbH. Development. Federal University of Technology of Paraná (2012). Oko-Institut (2007). Product Sustainability “Social Life Cycle Assessment of Natura’s cocoa Assessment, PROSA guidelines. soap”. Practical Aspects of Social Life Cycle Assessment International Workshop. May 25, 2012, PRé Sustainability (2013). “Roundtable for Product Berlin. Social Metrics”. GRI (2014). GRI – G4: sustainability reporting PRé Sustainability (2014). Handbook for Product guidelines and implementation principles. Global Social Impact Assessment, v. 2.0. Reporting Initiative. Quantis Canada, Groupe AGECO (2011). Groupe AGECO, CIRAIG (2011). “The use of S-LCA Environmental and Socio-Economic Life Cycle in the development of an extended producer Assessment of Milk in Canada. LCA XI – Session responsibility policy: testing end-of-life scenario for “Got Milk?”. computer products in Québec”. International seminar Revéret, Jean-Pierre, J.M. Couture and J. Parent on SLCA, Montpellier. (2015). “Socioeconomic LCA of Milk Production Henkel AG & Co. KGaA. (2012). “The Sustainable in Canada”. Social Life Cycle Assessment, Consumption Index, Measuring progress in Environmental Footprints and Eco-design of sustainability on product/process level”. Practical Products and Processes. S.S. Muthu (ed.). Springer Aspects of Social Life Cycle Assessment International Science+Business Media Singapore. Workshop. May 25, 2012, Berlin. Roundtable for Product Social Metrics (2014). International Organization for Standardization (ISO) Handbook for Product Social Impact Assessment. standards ISO 14040:2006 and ISO 14044:2006. v. 2.0. ILO (no date). “International Labour Standards on Technical University of Denmark (2012). Vocational guidance and training”. International “Implementing SLCA together with LCA for a Case Labour Organization. Study in the Construction Industry”. Practical Aspects of Social Life Cycle Assessment International ILO (1998). ILO Declaration on fundamental principles Workshop. May 25, 2012, Berlin. and rights at work. International Labour Organization. UN (2008). “Protect, Respect and Remedy” ILO (2004). R195 - Human Resources Development Framework for Business and Human Rights. Recommendation, 2004 (No. 195) Recommendation United Nations. concerning Human Resources Development: Education, Training and Lifelong Learning Adoption: UN Global Compact (2013). A Framework for Geneva, 92nd ILC session (17 June 2004). Business Engagement in Education 2013. United International Labour Organization. Nations Global Compact. Social Life Cycle Metrics for Chemical Products | 53

UNEP/SETAC (2009). Guidelines for Social Life Cycle Websites Assessment of Products and Associated Works. • Carbon Disclosure Project—http://www.cdp.net United Nations Environment Programme/Society for Environmental Toxicology and Chemistry. • DSM’s People Life Cycle Assessment (LCA) tool— http://www.dsm.com/corporate/sustainability.html UNEP/SETAC (2013 pre-publication). Methodological Sheets for Subcategories in Social Life Cycle • Greendelta – Practical Aspects of Social Life Assessment (S-LCA). United Nations Environment Cycle Assessment International Workshop — Programme/Society for Environmental Toxicology and www.greendelta.com/Social-LCA-Workshop- Chemistry Life Cycle Initiative. 2012.220.0.html UNEP/SETAC Life Cycle Initiative (2014). Hotspots • Greenhouse Gas Protocol—www.ghgprotocol.org Analysis: mapping of existing methodologies, tools • IndustriALL global union—http://www.industriall- and guidance and initial recommendations for the union.org development of global guidance. United Nations Environment Programme/Society for Environmental • International Labor Organization—www.ilo.org Toxicology and Chemistry. • International Organization for Standardization University of Bologna (2012). “Gold mining in 26000 —http://www.iso.org/iso/home/standards/ Peru, Analysis of social impacts and improvement iso26000.htm potential”. Practical Aspects of Social Life Cycle • PricewaterhouseCoopers Total Impact Assessment International Workshop. May 25, 2012, Measurement and Management—http://www. Berlin. pwc.com/totalimpact WBCSD (2013). Addressing the Avoided Emissions • Responsible Care—http://www.icca-chem.org/en/ Challenge Guidelines. World Business Council for Home/Responsible-care Sustainable Development and the International Council of Chemical Associations (ICCA). • Social Accountability International—http://www.sa- intl.org WBCSD (2014). Life Cycle Metrics for Chemical Products. World Business Council for Sustainable • Social Hotspots Database— Development. www.socialhotspot.org WBCSD, IFC (2008). Measuring Impact – Framework • Solvay Sustainable Portfolio Management—http:// methodology. World Business Council for Sustainable www.solvay.com/en/sustainability/product- Development and International Finance Corporation. responsibility/index.html WBCSD, IFC (2008). Measuring Impact – Framework • Social Value UK (formerly the SROI (Social methodology. World Business Council for Sustainable Return on Investment) Network—http://www. Development and International Finance Corporation. thesroinetwork.org WRI/WBCSD (2011). GHG Product Life Cycle • UNEP/SETAC Life Cycle Initiative—http://www. Accounting and Reporting Standard. World lifecycleinitiative.org Resources Institute and World Business Council for • WBCSD Social Capital project—http://www. Sustainable Development. wbcsd.org/socialcapital.aspx 54 | Social Life Cycle Metrics for Chemical Products

MAIN SOURCES OF INFORMATION

• International Labour Organization (ILO) • Methodological Sheets for Subcategories in Social Life Cycle Assessment (S-LCA) (UNEP/SETAC Life Cycle Initiative, 2013 pre-publication) • Handbook for Product Social Impact Assessment (PRé Sustainability, 2014) Health & Safety • ISO 26000 (International Organization for Standardization) • SA 8000 (Social Accountability International) • DSM key performance indicators (KPIs) • Responsible Care • G4 Sustainability Reporting Guidelines (Global Reporting Initiative (GRI))

• Business Social Compliance Initiative (BSCI) is a widely used supplier management system focusing on improving sustainability in the supply chain and established by the Foreign Trade Association in 2003 (http:// www.bsci-intl.org/) • International Labour Organization (ILO) • Methodological Sheets for Subcategories in Social Life Cycle Assessment (S-LCA) (UNEP/SETAC Life Cycle Initiative, 2013 pre-publication) • Roundtables and non-governmental organizations (NGOs) (e.g. the Humanist Institute for Cooperation (Humanistisch Instituut voor Ontwikkelingssamenwerking - HIVO) Workers’ rights • Estimating a living wage: A methodological review (http://www.ilo.org/wcmsp5/groups/public/---ed_ & Basic needs protect/---protrav/---travail/documents/publication/wcms_162117.pdf) • http://fairwageguide.org/ • http://livingwage.mit.edu/ (only for U.S.) • National and international statistics (e.g., http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/ home/) • http://www.tradingeconomics.com • UN Global Compact (http://www.unglobalcompact.org/) • Ruggie framework (http://www.ohchr.org/Documents/Publications/GuidingPrinciplesBusinessHR_EN.pdf)

• Roundtable for Product Social Metrics Well-Being • Company reporting systems

• Handbook for Product Social Impact Assessment (PRé Sustainability, 2014) • Methodological Sheets for Subcategories in Social Life Cycle Assessment (S-LCA) (UNEP/SETAC Life Cycle Initiative, 2013 pre-publication) • Chhipi-Shrestha, G. K., K. Hewage, R. Sadiq (2014) “‘Socializing’” sustainability: a critical review on current development status of social life cycle impact assessment method”. Clean Technologies and Environmental Skills & knowledge Policy 17 (3), 579-596. • ILO R195 - Human Resources Development Recommendation, 2004 (No. 195) Recommendation concerning Human Resources Development: Education, Training and Lifelong Learning Adoption: Geneva, 92nd ILC session (17 June 2004). • A Framework for Business Engagement in Education 2013 (UN Global Compact, 2013). • A Skilled Workforce for Strong, Sustainable and Balanced Growth: A G20 Training Strategy (International Labour Office, Geneva, 2011)

Employment • Global level - How’s life? Measuring well-being (OECD, 2013) • G4 Sustainability Reporting Guidelines (Global Reporting Initiative (GRI))

Sources of information used by subgroups to for Product Social Impact Assessment (PRé define the social topics and indicators Sustainability, 2014, p. 113). Social topics and indicators were also built using the sources presented in Version 2.0 of the Handbook Social Life Cycle Metrics for Chemical Products | 55

Appendix 2. Databases - esent, e.g. pages 10 and

rced from this website. from rced Comments mployment opportunities; adequate earnings and productive work; decent hours; mployment opportunities; adequate earnings and productive Country profiles on occupational health for many countries: indicates the fatal & non-fatal injuries Country profiles occupation, etc. economic activity, rate, and gender, work, as well frequency from as the number of on worker safety (number of fatalities and lost time injury rate, expressed Figures lost-time accidents with at least one day out of work per million working hours). authorities and bodies, policies programs laws and regulations, International labor standards, as to fatal and non-fatal injuries with figures and statistics (the section occupational injuries provides groups. and reference frequency economic activity, to gender, regards issues, including information on country context, four cases of occupational health related Provides guidance for businesses and engagement opportunities, including one for the chemical industry, company initiatives on decent work in several countries, covering ten dimensions of Report assessing progress decent work (e of combining work, family and personal life; work that should be abolished; stability security social security; in employment; safe work environment; work; equal opportunity and treatment economic and social context for decent work). dialogue, workers’ and employers’ representation; The economic and social context is also explained, important policy advances challenges highlighted. Specific information on minimum wages is also present. and national statistics on minimum wages. global, regional Report providing information to determine fair wages and pricing, using minimum wage data for 150 providing Tool made on an hourly or countries and international poverty lines to calculate benchmarks for products not made available by the website. piece rate basis. Databases used for calculation are Communities is a campaign of the International Labor Rights Forum, assisting sweatshop SweatFree a methodolo working conditions and unions. The organization provides workers globally to improve for 2007-2008. gy for non-poverty wages and figures See description above. Specific information on minimum wages is also pr http://www.ilo.org/wcmsp5/groups/public/--- 11. A summary of the document is available here: dgreports/---integration/documents/publication/wcms_228941.pdf refers mostly to released. It for Brazil was Profile - In 2013, the second edition of Decent Work in the second half of 2000s and incorporates a wider range indicators that those adopted a chapter on companies and decent work. A sub-national the first edition. In addition, it features perspective is adopted in this report. information for 196 countries including historical data Economics is a website providing Trading for economic indicators, exchange rates, stock market indexes, government bond yields and It indicates minimum wage in Brazil (724 BRL) commodity prices. Data is based on official sources. and context (comparison with other countries and history). Definitions for indicators and provides using it as an informatory thus recommend not available on the website. We for data are sources any information sou tool and cross-checking • • • • • • • • • •

ILO Decent work country profiles ILO Decent work country profiles http://www.ilo.org/integration/themes/mdw/lang--en/index.htm Conditions Laws Report 2012 - A global review ILO Working Fair wage guide : http://fairwageguide.org/ http://www. the World for Countries Around Non-Poverty Wages sweatfree.org/nonpovertywages Economics - Brazil minimum wage: Trading http://www.tradingeconomics.com/brazil/minimum-wages Economics - Brazil average wages: Trading http://www.tradingeconomics.com/brazil/wages Databases (from UNEP/SETAC, PwC search and CEFIC) Databases (from UNEP/SETAC,

• • • • • • > Global level to estimated number of occupational accidents according Global trend and country level diseases at region and fatal work-related https://osha.europa.eu/en/press/articles/global-trend-according-to- estimated-number-of-occupational-accidents-and-fatal-work-related- diseases-at-region-and-country-level country data ILOSTATS http://www.ilo.org/safework/countries/lang--en/index.htm our Report 2002-2012 – Growing Progress ICCA Responsible Care future CEFIC: http://www.cia.org.uk/CIAServices/WorkplaceHealth.aspx From ------> Brazil Brazil Occupational safety and health country profile: ILOSTATS http://www.ilo.org/safework/countries/americas/brazil/lang--en/index. htm Human Rights and Business Country Guide – Occupational Health in Brazil http://hrbcountryguide.org/countries/brazil/labor-issues/forced-labor/ > Global Level : SBS (structural business statistics) - Nice R2 level (under Eurostat’s “Earnings”) ------> Brazil Level Work in Brazil - Measuring Decent ILO Decent work country profile http://www.ilo.org/wcmsp5/groups/public/---dgreports/---integration/ documents/publication/wcms_124376.pdf 2013 Report: http://www.ilo.org/wcmsp5/groups/public/---dgreports/-- -integration/documents/publication/wcms_228791.pdf Workers’ Workers’ occupational health risks Management of individual worker’s health Safety management system for workers Fair wages Mandatory social topics Workers 56 | Social Life Cycle Metrics for Chemical Products

uidance for businesses and examples of engagement opportunities. ntage of child labor by country (including information on age, school attendance, gender, ntage of child labor by country (including information on age, school attendance, gender, ey providing context, legal framework and practical implementation of freedom of association, context, legal framework and practical implementation of freedom ey providing Surv collective bargaining and strikes for most countries. Update by country. and cases of non-compliance or conflicts for each quality of law enforcement Legal requirements, country of association, collective Context, legal framework and practical implementation of freedom bargaining and strikes in Brazil. (2014 update) and cases of conflict in Brazil, quality of law enforcement, Legal requirements information on country context (unionization, anti-union discrimination, collective bargaining, Provides to cases of issues or public complaints related three It also reports strikes, access to remedy). it provides workers’ union. Finally, and the petrochemical the topic, including a case involving Vale human rights g Perce studies etc.), country reports, economic activity, residence, on the efforts of certain U.S. trade beneficiary countries and territories to eliminate Annual report mechanisms, policies and social legislation, enforcement the worst forms of child labor through programs. and place of residence aged 5-14 years engaged in child labor (by gender, of children Percentage include publications on specific aspects of child household wealth quintile). Additional resources labor. workers and by country or forced by children Goods produced releases. countries, news Reports on child labor issues in different • • • • • • • • • •

> Global level Union Rights ITUC Survey of violations Trade http://survey.ituc-csi.org/Brazil.html?edition=336&lang=en#tabs-3 Human Rights and Labor - Country Reports on of Democracy, Bureau Human Rights Practices for 2013 http://www.state.gov/j/drl/rls/hrrpt/humanrightsreport/index. htm#wrapper ------> Brazil Union Rights – Brazil ITUC Survey of violations Trade http://survey.ituc-csi.org/Brazil.html?edition=336&lang=en#tabs-3 Human Rights and Labor - Country Reports of Democracy, - Bureau rights - on Human Rights Practices for 2013 – Brazil, Workers’ of Association and the Right to Collective Bargaining Freedom http://www.state.gov/j/drl/rls/hrrpt/humanrightsreport/index. htm#wrapper Union in Brazil - Human Rights and Business Country Guide –Trade http://hrbcountryguide.org/countries/brazil/labor-issues/trade-unions/ > Global level Bank, UNICEF) (ILO, World Project Work Understanding Children http://www.ucw-project.org/Pages/InfoByCountry.aspx 2012 Findings on the - United States of America Department Labor, Forms of Child Labor Worst http://www.dol.gov/ilab/reports/pdf/2012TDA.pdf - UNICEF Database on child labor http://data.unicef.org/child-protection/child-labor List of goods - United States of America Department Labor, labor http://www.dol.gov/ilab/reports/ by child or forced produced child-labor/list-of-goods/ Section on child labor - Human Rights’ Watch, http://www.hrw.org/by-issue/publications/691 ------> Brazil Bank, UNICEF) - (ILO, World Project Work Understanding Children Brazil http://www.ucw-project.org/Pages/CountryDetails.aspx?id=29 2012 Findings on the - United States of America Department Labor, Forms of Child Labor – Brazil Worst http://www.dol.gov/ilab/reports/child-labor/brazil.htm - Human Rights and Business Country Guide – Child Labour in Brazil http://hrbcountryguide.org/countries/brazil/labor-issues/forced-labor/ Freedom of Freedom association No child labor Social Life Cycle Metrics for Chemical Products | 57 ational goals, regulations and policies, statistics for access to healthy nutrition. ational goals, regulations rt providing an overview of the global situation and regional trends for drinking water and trends an overview of the global situation and regional rt providing Repo for provided for 1990-2010 are to MDGs. Country figures global sanitation, including with regards of population (pp 38 – in percentage the use of sanitation facilities and water sources 55). Development Indicators, global economic General data on countries and economies (World & operations, finances, surveys, climate). In the world development projects – forecasts, prospects is for rural or urban areas) water source indicators section, data on access to water (improved available for most countries. rural/urban (% of rural or urban population with access) in Brazil water source Improved in a dwelling, to housing, as well with the number of rooms Data on satisfaction with regards private access to indoor flushing toilet. number of persons living there, access, stability and use. Country data on indicators for availability, insights for the suite of the world in 2014, providing Report assessing undernourishment around food security and nutrition. to improve food security indicators and for the enabling environment In the last section, it focuses on lessons learned for several countries, including Brazil. It provides information on n Ranking of 162 countries around the world, based on a combined measure of three factors: of three the world, based on a combined measure Ranking of 162 countries around of child marriage, and a of modern slavery by population, a measure estimated prevalence provides a quantitative ranking The Index of human trafficking in and out a country. measure that is, the of slavery, to the estimated prevalence the world according of 162 countries around of enslaved people in the national population at a point time. The Index estimated percentage country by country. an estimate of the size modern slavery problem, also provides forms of evolutions, comparisons by region, labor, global statistics on forced providing 2012 report of victims. gender and age group labor, workers, by country (2013) or forced by children Goods produced global laborers, report for Brazil: information on the number of forced 2013 findings and progress for improvement context and recommendations ranking, regulation, guidance for businesses and labor, information on country context, four cases of forced Provides engagement opportunities, including company initiatives. • • • • • • • • • • • Provides references to treaties, legislation, court decisions and literature for environmental issues, for environmental legislation, court decisions and literature to treaties, references Provides of Thus, can be used as a tool to evaluate the strength disposal and recycling. including on product national legislation in that area.

http://www.globalslaveryindex.org/report/?download http://www.globalslaveryindex.org/report/?download http://www.ilo.org/wcmsp5/groups/public/---ed_norm/--- declaration/documents/publication/wcms_182004.pdf http://www.globalslaveryindex.org/country/brazil/#article-1098 Labour in Human Rights and Business Country Guide – Forced Brazil: http://hrbcountryguide.org/countries/brazil/labor-issues/ forced-labor/ The Global Slavery Index 2013 – Walk Free Foundation Free The Global Slavery Index 2013 – Walk Labour ILO Global Estimate of Forced Foundation: Brazil Free The Global Slavery Index 2013 – Walk > Global level on drinking water and sanitation – 2012 UNICEF WHO - Progress update http://www.unicef.org/media/files/JMPreport2012.pdf Bank – General country data World http://data.worldbank.org/country?display=graph – Food Security Indicators FAO http://www.fao.org/economic/ess/ess-fs/fs-data/en/ ------> Brazil Bank – General country data (see description above) World http://data.worldbank.org/indicator/SH.H2O.SAFE.RU.ZS/countries/ BR?display=graph OECD Better Life Index – Housing in Brazil http://www.oecdbetterlifeindex.org/countries/brazil/ - The State of Food Insecurity in the world Food Programme World 2014 http://www.fao.org/3/a-i4030e.pdf disposal and on product for country regulations ECOLEX search - http://www.ecolex.org recycling • • • • > Global level List of goods United States of America Department Labor, labor by child or forced produced http://www.dol.gov/ilab/reports/child-labor/list-of-goods/ ------> Brazil Health and safety of local living community’s conditions Access to basic needs for human right to dignity clean (healthcare, water & sanitation, healthy food, shelter) Job creation Impact on consumers health and safety No forced labor, labor, No forced human trafficking and slavery Skills, knowledge and employability Local communities Consumers 58 | Social Life Cycle Metrics for Chemical Products Comments by means of questionnaires that are sent to ILO Member that are by means of questionnaires Report providing global, regional and national statistics on weekly normal hour limits, overtime global, regional Report providing annual leave. limits, overtime remuneration, in working-time schedules, statistical information about national practices, trends Survey providing Although recommendations for the future. impediments to ratifications of the ILO Conventions and useful information as to how the situation has evolved. this is a bit outdated, it can provide cases of lawsuits for the violation appropriate information on country context, three Provides working hours, guidance for businesses and engagement opportunities. The website provides Labour Conditions in the in this context information on the National Commitment to Improve Activity (2008 – current). Sugarcane collects and disseminates detailed statistics on the The ILO Department of Statistics (LABORSTA) in manufacturing; weekly following aspects of working time: hours work by economic activity, of the hours of work in non-agricultural activities and manufacturing; theh distribution employed population by hours of work (1995-2005 only). In addition, data on are which is conducted with reference the ILO October Inquiry, collected for 159 occupations through to the month of October each year States. with a focus a global overview and country data (see annex) on social security, Report providing for women and men of working age and families, social protection for children on social protection disability benefits and maternity unemployment protection, (including employment injury protection, universal coverage in health, and for older women and men, towards social protection protection), expanding social protection. established by statute that insure cover national social security programs The Country Profiles old age, disability or survivorship; from individuals against interruption or loss of earnings resulting sickness and maternity; work injury or occupational disease; unemployment; and child rearing. in the Americas, Africa, Asia and Pacific, an overview of social security programs They provide for over 170 countries and territories, profiles provided Scheme descriptions are and Europe. surveys carried out by the ISSA of complementary and private pensions in 50 countries. Sources: security in co-operation with the U.S. Social Security Administration (SSA), OECD, IOPS, social over a two-year cycle (Africa region-by-region the world. Information is updated officials throughout 2012). 2013, the Americas Asia and Pacific 2012, Europe branches of social security on different information for each country and region Database providing variables (e.g. qualifying period of unemployment, etc.) with different invalidity, (e.g. work injury, contribution/work for work injury) and year. resources indicators, scheme description, external scheme data, pensions, reforms, Overview, http://www.ssa.gov/policy/docs/progdesc/ssptw/2012-2013/americas/brazil.pdf • • • • migrant workers, persons with HIV/AIDS, information on country context (Afro-Brazilians, Provides unionization, anti-union persons with disabilities, gender minorities, women, access to remedy cases of issues three It also reports discrimination, collective bargaining, strikes, access to remedy). human rights guidance for businesses and it provides to the topic. Finally, or public complaints related examples of engagement opportunities. • • • •

Databases (from UNEP/SETAC, PwC search and CEFIC) PwC search UNEP/SETAC, Databases (from

ILO World Social Protection Report 2014/2015 Social Protection ILO World http://www.ilo.org/wcmsp5/groups/public/---dgreports/--- dcomm/documents/publication/wcms_245201.pdf International social security association – programs the world and social security country profiles throughout http://www.ssa.gov/policy/docs/progdesc/ssptw/ http://www.issa.int/country-profiles and mechanisms; ILO Social security database – Programs inquiry; statistics http://www.ilo.org/dyn/sesame/IFPSES.SocialDatabase ------> Brazil International social security association – programs – Brazil the world and social security country profiles throughout (2013) country profile http://www.issa.int/country-details?countryId=BR®ionId=AME &filtered=false • • • > Global level Conditions Laws Report 2012 - A global review ILO Working ILO – General survey on hours of work 2005 http://www.ilo.org/public/english/standards/relm/ilc/ilc93/pdf/rep-iii- 1b.pdf > Brazil conditions and Human Rights and Business Country Guide – Working working hours in Brazil http://hrbcountryguide.org/countries/brazil/labor-issues/working- conditions/ - Hours of work in manufacturing (per week), by ILO LABORSTA economic activity (per week) – Brazil http://laborsta.ilo.org/ > Brazil Human Rights and Business Country Guide – Holders at Risk in at risk of employment-related in Brazil (societal groups the Workplace discrimination and poor labor conditions) http://hrbcountryguide. org/countries/brazil/rights-holders-at-risk/vulnerable-groups-in-the- workplace/ > Global level Appropriate Appropriate working hours No discrimination Social /employer security and benefits Workers Optional social topics Optional impact categories Social Life Cycle Metrics for Chemical Products | 59 eport including information on indigenous peoples (rights and their violation for Human Rights R example) when relevant. on Reports and publications by country or topic. General focus on human rights but information indigenous peoples and their rights is also provided. to regards Reports and articles on rights in business, by topic, company or country (including with land rights and indigenous peoples). rights for indigenous peoples, Overview of the situation in Brazil; information on land tenure to indigenous peoples. regards in Brazil, land use, management and conflicts with regulation language) on Brazil includes statistics indigenous peoples (population size, groups, The report to indigenous rights, conflicts, etc. information with regards and provides both based on indicators that are global reporting an initial system for regular provides This report global energy databases. The annex current and feasible to compute from technically rigorous energy and access to non-solid fuel, renewable country data on access to electricity, provides energy efficiency. of population with access Access to electricity: percentage Data available for some countries only. national surveys and industry, collected from Electrification data are to electricity for each country. international sources. energy energy, extend network, capacity concerns, renewable reliance, Data on energy sources, role of ownership, competition, energy framework, debates, studies, efficiency, etc. REEGLE is an energy regulator, government, government agencies, energy procedure, such as information portal that has established knowledge partnerships with providers Bank and the International Energy Agency. the World energy distribution networks, connection points of energy, Statistics on access to electricity, biofuels. renewables, to regions electric system, access – with references with data on energy supply, Presentation biomass in the and case studies on energy supply from in Brazil, rural electrification programs Amazon. Access to information and telecommunications services can be determined thanks the indicators broadband Internet subscribers (per 100 World Bank country data (fixed by provided and figures people); ICT goods exports (% of total exports); imports imports); ICT service exports (% of exports, BoP); Internet users (per 100 people); mobile cellular Internet servers (per 1 million people)). subscriptions (per 100 people); secure Assessment of different aspects of people’s well-being in OECD and selected emerging economies, aspects of people’s Assessment of different for instance information on employees working long provides including on job satisfaction. The report work family 2.14 and 2.15), perceived (figures and personal care hours and time devoted to leisure 3.12), life satisfaction and labor market status main dimensions of conflict (box 3.2 and figure 5.1 and table 5.1). Countries assessed include Brazil. work and employment quality (figure • • • • • • • • • • •

Bureau of Democracy, Human Rights and Labor of the USA, of Democracy, Bureau Country Reports on Human Rights Practices for 2013 http://www.state.gov/j/drl/rls/hrrpt/humanrightsreport/index. htm#wrapper by country and issue Amnesty International human rights report http://www.amnesty.org/en/human-rights/human-rights-by- country on racial reports Centre Business & Human Rights Resource discrimination http://business-humanrights.org/en/regions-countries/americas/ brazil ------> Brazil governance profile rights and resource Brazil—property http://usaidlandtenure.net/sites/default/files/country-profiles/full- reports/USAID_Land_Tenure_Brazil_Profile.pdf Country Human Rights and Labor, of Democracy, USA Bureau Reports on Human Rights Practices for 2013 – Brazil http:// www.state.gov/j/drl/rls/hrrpt/humanrightsreport/index. htm#wrapper by country and issue Amnesty International human rights report http://www.amnesty.org/en/region/brazil/report-2012 - Report on Brazil (see description above) Framework 2013 Bank Global Tracking World http://documents.worldbank.org/curated/ en/2013/05/17765643/global-tracking-framework-vol-3-3- main-report Bank country data World http://data.worldbank.org/indicator#topic-9 Bank Data - Access to electricity World http://data.worldbank.org/indicator/EG.ELC.ACCS.ZS ------> Brazil Clean Energy information portal (REEGLE) – Policy database, Brazil http://www.reegle.info/policy-and-regulatory-overviews/BR Agency) – and Investment Promotion APEX (Brazilian Trade Brazil in the world – energy http://www2.apexbrasil.com.br/en/invest-in-brazil/why-invest- in-brazil/energy#./energy?&_suid=1412253672142018910455 82284629 Suani Center on Biomass, Prof. CENBIO – Brazilian Reference Coelho – Energy access in Brazil (2009) http://www.cepal.org/drni/noticias/noticias/6/37496/Coelho.pdf • • • • • • • • • • • • > Global Level > Global level > Global level life? 2013. Measuring Well-being OECD Study – How’s http://www.keepeek.com/Digital-Asset-Management/oecd/ economics/how-s-life-2013_9789264201392-en#page153 Indigenous’ rights Access to basic needs for sustainable development (access to ICT services, energy, sanitation, land rights) Job satisfaction Management of reorganization Local communities 60 | Social Life Cycle Metrics for Chemical Products ata from 2008-2012 on administrative data school participation, youth and adult literacy rates, ata from D net survey data on primary net attendance, survival rate and secondary attendance rate. Data available for most countries. yearly statistics (last updates vary) on country participation, progression, Database providing completion, literacy rates and population, educational attainment, international student mobility in and teaching conditions resources school resources, financial tertiary education, human resources, (Africa only), adult education (Latin America and Caribbean population, system. • •

> Global level UNICEF data on education http://data.unicef.org/education/overview UNESCO education database http://data.uis.unesco.org/ Nuisance reduction Developing with relationship local communities of skills Promotion and knowledge impact on Direct basic needs Consumer’s product experience of skills Promotion & Knowledge Consumers Social Life Cycle Metrics for Chemical Products | 61

Appendix 3. WBCSD Work group methodology for the building of the indicator scales The working group members were spread into five subgroups (one subgroup per social area) and were given the following template and example to build the indicator scales:

SUBGROUP OPERATING MODE How did the subgroup decide on the list of subtopics? How did the subgroup decide on the list of indicators and how were they classified among performance levels ? SUBTOPICS List all the subtopics and provide a small presentation/definition for each Subtopic 1 in order to clarify at least the scope and the approach Subtopic 2 (listing of indicators is not required) Subtopic … MAIN SOURCES OF INFORMATION USED List the main sources of information that the subgroup used to provide the definitions, indicators, etc. SPECIFIC QUESTIONS RAISED BY THE SUBGROUP Did the subgroup encounter any difficulties or were questions raised that might be worthwhile for/discussed with all subgroups?

Figure 21: Template used to describe the subgroup’s methodology

Health Proposed definition Score Indicator Recommended primary Recommended primary & safety (based on PRé internal data sources external data sources (Consumers) handbook definition) Impact on Products are expected Scale- (a) The level of contribution of the Product quality assurance ICCA GPS portal consumers’ to perform their intended based product to consumers’ health and safety, manual, product risk health and functions satisfactorily excluding intended basic functions. assessment dossier safety and not pose a risk to (b) The product is risk assessed for consumers’ health and consumer use and the outcome is safety. This social topic communicated to the general public. addresses both risks and the positive impacts that (c) There is a procedure in place in the products may have on the event of the recall of an unsafe product. health and safety of the (d) The product is labelled for safe han- end-users of products. dling and disposal. (e) The product is labelled on a voluntary basis for safe handling. (f) The product increases risk of disease, accident or injury. 2 a,b,c,d,e 1 a,b,c,d 0 b,c -1 a -2 f

Figure 22: Example of the structure followed to build an indicator’s scale 62 | Social Life Cycle Metrics for Chemical Products

Appendix 4. Generic reference scales for indicators and advanced indicators Introduction Explanation of the typical structure of the scaling:

Explanation of scoring a) Criteria to fulfill to reach the scales have been defined to facilitate the positioning on the scale. b) The criteria to achieve to reach each scale is detailed below. … 2 Outstanding/exemplary performance => All the criteria are achieved 1 Good performance => Almost all the criteria are achieved or partially achieved 0 Standard performance/compliance => Compliance criteria achieved -1 Inadequate performance => One or two criteria achieved or partially achieved -2 Unacceptable performance => No criteria achieved Unknown (default)

To identify the level of the scale that the product criteria (a, b, c, etc.) are met (symbolized by a red application assessed reaches, the company cross). assessing the product application must check which

• Example of a 0 level for the “Social/employer security and benefits” social topicindicator: Social/employer X a) Policies in reporting company exist security and X b) Company provides a minimum standard of social security in terms of healthcare and income security benefits X c) Company provides access to remedy

d) Company provides social security in terms of healthcare and income security (incl. old age) additional to national regulations (e.g. company pension scheme, protection, etc.) e) Suppliers are actively encouraged to achieve a,b,c,d

2 a,b,c,d,e achieved

1 a,b,c,d achieved

0 a,b,c achieved

-1 a,b partially achieved

-2 a,b,c,d,e not achieved

• Example of a +2 level for the “Social/employer security and benefits” socialtopic indicator:

X e) Suppliers are actively encouraged to achieve a,b,c,d

2 a,b,c,d,e achieved

1 a,b,c,d achieved

0 a,b,c achieved

-1 a,b partially achieved

-2 a,b,c,d,e not achieved Social Life Cycle Metrics for Chemical Products | 63

• Example of a 0 level for the “Social/employer security and benefits”advanced indicator:

Social benefits (incl. social security expenditures) 2 Description of social benefits (incl. social security expenditures) of keys life cycles stages of the calue chain companies is available in official reports. 1 Description of social benefits (incl. social security expenditures) of keys life cycles stages of the calue chain companies is partially available in official reports. 0 Description of social benefits (incl. social security expenditures) of the reporting company is available in official reports. -1 Description of social benefits (incl. social security expenditures) of the reporting company partly exists. -2 Description of social benefits (incl. social security expenditures) of the reporting company does not exist.

GUIDANCE & DEFINITIONS We have considered 3 stakeholder groups—workers, communities and consumers—for the entire life cycle of products, including the end of life of products.

For workers, the questionnaire applies to all workers involved in the key life cycle stages of the product (from raw material extraction to manufacturing, use or disposal).

Workers are defined as people who are employed to perform work related to the product value chain. The key life cycle stages are the stages identified in the materiality/hotspot analysis. The assessment must be carried out for any worker involved in the key stages. In cases where there is an occupational consideration (e.g. occupational health), the spatial limits are those of the working site (e.g. on the product manufacturing site, the company’s own employees, contractors and suppliers on the site will be considered as one group of workers)

OVERARCHING STAKEHOLDERS SOCIAL TOPICS Workers Local communities Consumers Social Topics • Fair wages • Appropriate working hours • Access to basic needs for human rights • Direct impact on basic needs • Freedom of association, collective and dignity (healthcare, clean water & (healthcare, clean water, healthy food, bargaining and labor relations Bacis rights & needs sanitation, healthy food, shelter) shelter, education) • No child labor • Respect for indigenous rights • No forced labor, human trafficking and slavery • No discrimination • Social/employer security and benefits

Employment • Management of reorganization • Job creation

• Workers’ occupational health risks • Management of workers’ individual • Health and safety of local community’s • Impact on consumer health and safety Health & Safety health

SOCIAL AREAS living conditions • Safety management system for workers

Skills & Knowledge • Skills, knowledge and employability • Promotion of skills and knowledge • Promotion of skills & knowledge

• Access to basic needs for sustainable development (infrastructure, ICT, modern energy) Well-Being • Job satisfaction • Consumer’s product experience • Nuisance reduction • Developing relationship with local communities The following pages of the guide detail the designed for indicators and advanced generic reference scales that have been indicators. 64 | Social Life Cycle Metrics for Chemical Products

1. Basic rights and needs ADVANCED INDICATOR 3 INDICATOR ADVANCED ADVANCED INDICATOR 2 INDICATOR ADVANCED

ADVANCED INDICATOR 1 INDICATOR ADVANCED All workers in the value chain are paid a living All workers in the value chain are wage. Indication of salary levels the workers with the lowest income in value chain are provided. paid a living wage. Indication of All workers are salary level of the workers with lowest income provided. are paid the legal or industry minimum All workers are on the salary level provided wage. Indications are of the workers with lowest income. Cases in the value chain companies can be paid below legal or detected in which workers are provided industry minimum wage. Indications are on the salary level of workers with lowest income. Cases in the value chain companies can be paid below legal detected in which workers are or industry minimum wage. No indications are on the salary level of workers with provided the lowest income. 2 1 0 -1 -2 Legal or industry minimum wage: to compensation per hour or other Minimum wage refers Since some unit of time for employment allowed under law. minimum wages (such as by state countries have numerous or by employment category), identify which or province minimum wage is being used. When no legal exists, use the industry average.

a, b, c, d achieved a, b achieved and c or d partially achieved a and b achieved a or b partially achieved a, b, c and d not achieved INDICATOR

2 1 0 -1 -2 a) Compensation management system, salary and description of legal/industry minimum structure documented. wage exist and are access to remedy. b) Company provides actively encouraged to have c) Suppliers are documented compensation management system, and description of legal/industry salary structure minimum wage. actively encouraged to provide d) Suppliers are access to remedy.

EXPLANATIONS EXPLANATIONS OCIAL TOPIC DEFINITION & S Wages paid for a normal work week shall Wages always meet at least the minimum wage, collective bargaining established either by law, and be or an industry standard, agreement sufficient to meet the basic needs of workers income. some discretionary and to provide Living wage means that wages received work week by a worker in for a standard a particular place shall be sufficient to afford of living for the worker and decent standard Minimum wage is determined her or his family. or collective bargaining agreement by law, Living wage is based an industry standard. carried out by an independent on research external party (depending on food basket of family and actual market price). Note: The issue of “overtime wages” rate) is included in at premium (reimbursement hours” below for practical the topic “Working for this (internal data sources reasons information is linked with working hours) Roundtable (Based on ILO, UNEP/SETAC, and NGOs (e.g. HIVOS))

TOPIC Fair wages (Mandatory) AME OF SOCIAL N Workers GROUP STAKEHOLDERS STAKEHOLDERS Social Life Cycle Metrics for Chemical Products | 65

1. Basic rights and needs ADVANCED INDICATOR 3 INDICATOR ADVANCED ADVANCED INDICATOR 2 INDICATOR ADVANCED

ADVANCED INDICATOR 1 INDICATOR ADVANCED Not a single case of child labor in the value chain companies can be detected and child labor is in the key life cycle stages of monitored/targeted the value chain companies Not a single case of child labor in the reporting company can be detected and child labor is in some of the value chain monitored/targeted companies Not a single case of child labor in the reporting company can be detected. Child labor in the value chain companies can be detected. Kind of child labor is described. Actions child labor (e.g. support undertaken to reduce are school education) and positive results of children’s measured. are Child labor in the value chain companies can be detected. Kind of child labor is not described. of child describing the reduction Measurable results (e.g. support labor or other achieved improvements school education) do not exist. of children’s 2 1 0 -1 -2 Child labor in the value chain concerned with child labor in their increasingly Companies are supply chains. They view it as inconsistent with company to their image and ability recruit values and as a threat top workers, as well to the sustainability of their and retain can be found in all stages of supply chain. Child laborers supply chains. - -

INDICATOR a,b,c,d,e,f achieved a,b,c,d,e achieved a,b,c,d achieved a achieved a,b,c,d,e,f not achieved 2 1 0 -1 -2 a) Policies against child labor, a compliance man a) Policies against child labor, to actively programs and proactive agement process engage in banning child labor exist. documented. are of age records b) Proof agencies and suppliers c) Employment, recruitment to avoid child labor. monitored proactively are access to remedy. d) Company provides actively encouraged to have policies e) Suppliers are a compliance management pro against child labor, to engage in banning programs cess, and proactive child labor and to support school education. actively encouraged to provide f) Suppliers are access to remedy.

EXPLANATIONS EXPLANATIONS OCIAL TOPIC DEFINITION & S Child labor is work that deprives children Child labor is work that deprives children of their childhood, potential and that is socially or morally dangerous dignity, and that is harmful to physical mental forms, development. In its most extreme being enslaved, child labor involves children their families, exposed to separated from and illnesses and/or left to serious hazards of large fend for themselves on the streets cities. Child working constitutes child labor if the child is below: • The age of 15 years; • Or the minimum age for employment set in the country if it is higher; • Or the age of completion compulsory education if it is higher. if local minimum age law is set However, with the at 14 years of age in accordance developing country exception under ILO Convention 138, this lower age may apply. A young worker is any over the age of a child and under the age 18. Young allowed to work under the workers are conditions stated in ILO Convention 138. Roundtable (Based on ILO, UNEP/SETAC, and NGOs (e.g. HIVOS))

TOPIC AME OF SOCIAL No child labor (Mandatory) N Workers GROUP STAKEHOLDERS STAKEHOLDERS 66 | Social Life Cycle Metrics for Chemical Products

1. Basic rights and needs ADVANCED INDICATOR 3 INDICATOR ADVANCED ADVANCED INDICATOR 2 INDICATOR ADVANCED

- ADVANCED INDICATOR 1 INDICATOR ADVANCED Not a single case of forced labor, human trafficking labor, Not a single case of forced in the companies and slavery is monitored/targeted of the key life cycle stages value chain. human trafficking labor, Not a single case of forced company can be and slavery in the reporting human trafficking and labor, detected and forced in the companies of slavery is monitored/targeted the key life cycle stages of value chain. human trafficking labor, Not a single case of forced company can be and slavery in the reporting detected. human trafficking and slavery in the labor, Forced companies of the key life cycle stages value human labor, chain can be detected. Kind of forced are un trafficking and slavery is described. Actions human trafficking labor, forced dertaken to reduce measured. are and slavery positive results human trafficking and slavery in the labor, Forced companies of the key life cycle stages value human labor, chain can be detected. Kind of forced trafficking and slavery is not described. Measurable labor, of forced describing the reduction results human trafficking and slavery or other achieved do not exist. improvements

2 1 0 -1 -2 % of forced labor, human trafficking and slavery in the value labor, % of forced chain human trafficking and slavery in the value chain labor, Forced human labor, concerned with forced Companies are trafficking and slavery in their supply chains. They view it as to their inconsistent with company values and as a threat top workers, as well and retain image and ability to recruit labor, as to the sustainability of their supply chain. Forced human trafficking and slavery can be found in all stages of supply chains.

INDICATOR a,b,c,d,e,f achieved a,b,c,d,e achieved a,b,c,d achieved d not achieved and a,b, c,d,e only partially implemented a,b,c,d,e,f not achieved

2 1 0 -1 -2 a) Policies against forced labor and a compliance a) Policies against forced exist. management process monitored agencies are b) Employment and recruitment labor. to avoid forced access to remedy. c ) Company provides d) Company complies with international laws. to actively engage in banning programs e) Proactive labor exist. forced actively encouraged to achieve a, b, c, d. f) Suppliers are

EXPLANATIONS EXPLANATIONS OCIAL TOPIC DEFINITION & S All work or service that is exacted from any All work or service that is exacted from person under the menace of any penalty and for himself which the said person has not offered to situations labor refers Forced voluntarily. in which persons are recruitment of unfree the use of violence or to work through coerced subtle means such as intimidation, or by more of identity papers or accumulated debt, retention of denunciation to immigration authorities threats or any other impossibility to leave the employer. Roundtable and (Based on ILO, UNEP/SETAC, NGOs (e.g. HIVOS)) TOPIC

AME OF SOCIAL No forced labor, labor, No forced human trafficking and slavery (Mandatory) N Workers GROUP STAKEHOLDERS STAKEHOLDERS Social Life Cycle Metrics for Chemical Products | 67

1. Basic rights and needs ADVANCED INDICATOR 3 INDICATOR ADVANCED ADVANCED INDICATOR 2 INDICATOR ADVANCED - - and does If there is peak If there

for hourly workers. Overtime is for hourly workers. Overtime is exceed 12 hours per week.

ADVANCED INDICATOR 1 INDICATOR ADVANCED Normal work week in the value chain does not exceed legal limit or 48 hours for hourly workers. voluntary and compen Overtime is recorded, rate and does not exceed 12 sated at premium is peak work, it within hours per week. If there legal boundaries. Normal work week does not exceed legal limit or 48 hours for hourly workers. Overtime voluntary and compensated at is recorded, rate and does not exceed 12 hours premium is peak work, it within legal per week. If there boundaries. Normal work week does not exceed legal limit or 48 hours voluntary and compensated recorded, not work, it is within legal boundaries. Normal work week exceeds legal limit or 48 hours for hourly workers in peak seasons only. voluntary and compensat Overtime is recorded, rate or exceeds 12 ed, but either not at premium hours per week. Normal work week exceeds legal limit or 48 hours regularly nor compensated. not recorded 2 1 0 -1 -2 Normal work week compared to legal limit Normal work week compared

a,b,c,d,e achieved a,b,c achieved and d,e partially implemented a,b,c achieved a achieved a,b,c,d,e not achieved INDICATOR

2 1 0 -1 -2 a) Work time management system exists and is a) Work documented. access to remedy. b) Company provides national law or industry stan c) Company respects and public holidays. on working hours, breaks dards actively encouraged to have d) Suppliers are documented work time management system and is documented. actively encouraged to provide e) Suppliers are access to remedy.

- EXPLANATIONS EXPLANATIONS OCIAL TOPIC DEFINITION & S The number of working hours is defined by applicable national laws and industry standards and public holidays. on working hours, breaks The normal work week, excluding overtime, shall not exceed limits set by law or 48 hours shall be provided for hourly workers. Workers with at least one day off following every six con secutive days of working. Overtime work shall rate compensated at a premium be voluntary, with either the law or applicable in accordance shall not exceed 12 hours collective agreement, basis. on a regular per week, nor be requested Roundtable and (Based on ILO, UNEP/SETAC, NGOs (e.g. HIVOS)) TOPIC AME OF SOCIAL Appropriate working Appropriate hours N

Workers GROUP STAKEHOLDERS STAKEHOLDERS 68 | Social Life Cycle Metrics for Chemical Products

1. Basic rights and needs ADVANCED INDICATOR 3 INDICATOR ADVANCED ADVANCED INDICATOR 2 INDICATOR ADVANCED - ADVANCED INDICATOR 1 INDICATOR ADVANCED Workers and/or employers do have the right to form Workers and join organizations of their own choice in the companies of the key life cycle stages value and influence of chain. Description of presence employers’ and workers’ organizations in the value chain exists (incl. contracts). and/or employers do have the right to form Workers and join organizations of their own choice. Descrip and influence of employers’ tion of presence workers’ organizations exists (incl. contracts). and/or employers do have the right to form Workers and join organizations of their own choice. and/or employers do not have the right to Workers form and join organizations of their own choice. and/or employers do not have the Workers right to form and join organizations of their own in their attempts to hindered are choice. Workers their right to organize themselves and exercise face bargain collectively or worker representatives disciplinary action. 2 1 0 -1 -2 Worker organization Worker

INDICATOR a,b,c, d,e achieved a,b,c achieved a,b achieved a,b partially achieved a,b,c,d,e not achieved 2 1 0 -1 -2 a) Workers and/or employers do have the right to a) Workers form and join organizations of their own choice b) Negotiations between employers’ and workers’ organizations for determining working conditions and terms of employment do occasionally take place. set up c) Employers’ and workers’ organizations are and further developed regionally/nationally. d) Negotiations between employers’ and workers’ organizations for determining working conditions and basis terms of employment take place on a regular bound by contract. and are actively encouraged to set up e) Suppliers are negotiations between employers and workers organizations for determining working conditions and terms of employment.

Handbook:

EXPLANATIONS EXPLANATIONS OCIAL TOPIC DEFINITION & S ILO Convention No. 154, PRé “The right of workers and employers to form and join organizations of their own choice, without prior authorization, to promote and interests, and defend their respective to negotiate collectively with other parties. without They shall be able to do this freely, by other parties or the state, and interference of union should not be discriminated as a result membership. The right to organize includes: the right of workers to strike, rights organizations to draw up their constitutions in full and rules, to elect their representatives and to to organize their activity freely freedom, All negotiations formulate their programmes. a which take place between an employer, employers’ of employers or one more group organizations, on the one hand, and or for: workers’ organizations, on the other, more (a) determining working conditions and terms of employment; and/or between employers and relations (b) regulating workers; and/or between employers or relations (c) regulating their organizations and a workers’ organization or workers’ organizations. (Article 2); and/or (d) if applicable, any collective labor agreements.” Roundtable and (Based on ILO, UNEP/SETAC, NGOs (e.g. HIVOS)) -

TOPIC AME OF SOCIAL Freedom of asso Freedom ciation, collective bargaining and labor relations (Mandatory) N

Workers GROUP STAKEHOLDERS STAKEHOLDERS Social Life Cycle Metrics for Chemical Products | 69

1. Basic rights and needs ADVANCED INDICATOR 3 INDICATOR ADVANCED ADVANCED INDICATOR 2 INDICATOR ADVANCED - - - - ADVANCED INDICATOR 1 INDICATOR ADVANCED Suppliers are actively encouraged to report key per actively encouraged to report Suppliers are multicultural formance indicators on gender equality, by national etc. higher than required hiring, diversity, requirements. key performance Reporting company reports multicultural hiring, indicators on gender equality, by national etc. higher than required diversity, requirements. key performance Reporting company reports multicultural hiring, indicators on gender equality, by national requirements. etc. required diversity, key perfor chain companies do not report Value multicultural mance indicators on gender equality, etc. or discrimination occurs in hiring, diversity, value chain companies. Kind of discrimination describing the is described. Measurable results of discrimination or achieved improve reduction ments exist. key performance indica Company does not report multicultural hiring, diversity, tors on gender equality, Kind etc. or discrimination occurs in the company. of discrimination is not described. Measurable of discrimination describing the reduction results do not exist. and achieved improvements 2 1 0 -1 -2 KPIs reporting on discrimination issues KPIs reporting

INDICATOR a,b,c,d,e,f achieved a,b,c,d,e achieved a,b,c,d achieved a,b achieved a,b,c,d,e,f not achieved

2 1 0 -1 -2 a) Policies against discrimination and for equal opportunities exist. exist. b) A compliance management process c) Company complies with national law or industry standards. access to remedy. d) Company provides exist. programs e) Proactive actively encouraged to achieve a,b,c,d,e. f) Suppliers are

EXPLANATIONS EXPLANATIONS OCIAL TOPIC DEFINITION & S Discrimination refers to any distinction, Discrimination refers which has the effect exclusion, or preference of nullifying or impairing equality opportunity to avoid discrimination In order or treatment. a company shall not engage in or support discrimination in hiring, remuneration, termination or access to training, promotion, based on race, national or social retirement gender, disability, origin, caste, birth, religion, sexual orientation, family responsibilities, marital status, union membership, political opinions, health condition (including HIV/AIDS status), age or any other condition that could give rise to discrimination. Roundtable and (Based on ILO, UNEP/SETAC, NGOs (e.g. HIVOS)) TOPIC No discrimination AME OF SOCIAL N

Workers GROUP STAKEHOLDERS STAKEHOLDERS 70 | Social Life Cycle Metrics for Chemical Products

1. Basic rights and needs ADVANCED INDICATOR 3 INDICATOR ADVANCED ADVANCED INDICATOR 2 INDICATOR ADVANCED ADVANCED INDICATOR 1 INDICATOR ADVANCED Description of social benefits (incl. of key life cycle security expenditures) stages of the value chain companies is reports. available in official Description of social benefits (incl. of key life cycle security expenditures) stages of the value chain companies is reports. partially available in official Description of social benefits (incl. of the reporting security expenditures) reports. company is available in official Description of social benefits (incl. of the reporting security expenditures) company partly exists. Description of social benefits (incl. of the reporting security expenditures) company does not exist. 2 1 0 -1 -2 Social benefits (incl. social security expenditures) Social benefits (incl. social security expenditures)

a,b,c,d,e achieved a,b,c,d achieved a,b,c achieved a,b partially achieved a,b,c,d,e not achieved INDICATOR

2 1 0 -1 -2 a) Policies in reporting company exist. a) Policies in reporting a minimum standard b) Company provides and of social security in terms healthcare income security. access to remedy. c) Company provides social security in terms d) Company provides and income security (incl. old of healthcare (e.g. age) additional to national regulations etc.). company pension scheme, protection, actively encouraged to e) Suppliers are achieve a,b,c,d

EXPLANATIONS EXPLANATIONS OCIAL TOPIC DEFINITION & S Social security is defined by applicable and involves national regulations and income access to healthcare particularly in cases of security, old age, unemployment, sickness, maternity or loss work injury, invalidity, Employer of a main income earner. security includes additional payments by the employer (e.g. occupational pension schemes, etc.) or other benefits for workers (e.g. in difficult situations). (Based on ILO, UNEP/SETAC, Roundtable and NGOs (e.g. HIVOS)) TOPIC AME OF SOCIAL Social/employer security and benefits N

Workers GROUP STAKEHOLDERS STAKEHOLDERS Social Life Cycle Metrics for Chemical Products | 71

1. Basic rights and needs - -

Improved literacy levels. Improved # people with Increased primary level education. yet No measurable progress made despite considerable time, efforts (resources, money) invested. Company or facility can demonstrate that it does no harm (but also does not contribute) to the local com access to education. munity’s Company or facility cannot demonstrate that it does no harm to the local community’s access to education. Deterioration of literacy level # of people with or reduced primary level education. commu Company prevents getting access to nity from education and/or competes with local schools. For example, company/facility going from children prevents to school. ADVANCED INDICATOR 3 INDICATOR ADVANCED 2 1 0 -1 -2w Local community’s access to Local community’s education: Literacy levels # people with primary level education - - -

- Decreased # of homeless Decreased people. in the No measurable progress number of homeless people yet made despite considerable money) time, (resources, efforts invested. Company or facility can demonstrate that it does no harm (but also does not contribute) to the local commu access to shelter. nity’s Company or facility cannot demonstrate that it does no harm to the local community’s access to shelter. # of homeless peo Increased com ple. Company prevents getting access to munity from shelter and/or competes with local public housing services/ facilities. For example, com housing, pany/facility destroys people to relocate forces without compensation. ADVANCED INDICATOR 2 INDICATOR ADVANCED 2 1 0 -1 -2 Local community’s access to shelter : Local community’s # of homeless people Decreased

ADVANCED INDICATOR 1 INDICATOR ADVANCED Description of social benefits (incl. of key life cycle security expenditures) stages of the value chain companies is reports. available in official Description of social benefits (incl. of key life cycle security expenditures) stages of the value chain companies is reports. partially available in official Description of social benefits (incl. of the reporting security expenditures) reports. company is available in official Description of social benefits (incl. of the reporting security expenditures) company partly exists. Description of social benefits (incl. of the reporting security expenditures) company does not exist. Level 0 AND The company contributes to 0.2 % of their revenue services. Alternative : Governmentfor healthcare services. invests 2% of the tax income in healthcare level 0 AND The company contributes to 0.1 % of their revenue services. Alternative : Governmentfor healthcare services invests 1% of the tax income in healthcare At least 95 % of the community has access to services. adequate healthcare At least 75 % of the community has access to services. adequate healthcare At least 50 % of the community has access to services. adequate healthcare 2 1 0 2 1 0 -1 -2 -1 -2 Social benefits (incl. social security expenditures) Social benefits (incl. social security expenditures) services access to adequate healthcare Local community’s services. contribution to healthcare and company’s

INDICATOR a,b,c,d,e achieved a,b,c,d achieved a,b,c achieved a,b partially achieved a,b,c,d,e not achieved

a, b,c,d,e,f achieved a, b,c achieved a,b achieved a partially achieved a, b,c,d,e,f not achieved

2 1 0 2 1 0 -1 -2 -1 -2 a) Policies in reporting company exist. a) Policies in reporting a minimum standard b) Company provides and of social security in terms healthcare income security. access to remedy. c) Company provides social security in terms d) Company provides and income security (incl. old of healthcare (e.g. age) additional to national regulations etc.). company pension scheme, protection, actively encouraged to e) Suppliers are achieve a,b,c,d a) The company or facility is taking action to improve the situation when harm is done by company to access to basic needs for the human local community’s right to dignity b) Company or facility can demonstrate that it does no access to basic needs harm to the local community’s for the human right to dignity (e.g. by having carried out an impact assessment). in place to improve c) Policies and first initiatives are access to basic needs for the human local community’s right to dignity. local community with d) Company or facility provides specific services. in health/living/education e) Measurable improvement conditions of local community is being tracked. a grievance mechanism f) Company or facility provides or other feedback loop for the local community.

EXPLANATIONS EXPLANATIONS

OCIAL TOPIC DEFINITION & S Social security is defined by applicable and involves national regulations and income access to healthcare particularly in cases of security, old age, unemployment, sickness, maternity or loss work injury, invalidity, Employer of a main income earner. security includes additional payments by the employer (e.g. occupational pension schemes, etc.) or other benefits for workers (e.g. in difficult situations). (Based on ILO, UNEP/SETAC, Roundtable and NGOs (e.g. HIVOS)) The extent to which a contribution is made access to : (e.g. health camps with doctors for - Healthcare health checks, medicine). It includes prevention and curing. If the company is harming access this leads to negative scores. to healthcare, - Clean water or sanitation. If the company is polluting water and deteriorating clean water, access to clean does not clean or is destroying sanitation, this water or services to provide leads to negative scores. - Healthy food. If (risk of) competition with healthy food is existing services to provide If the identified, this will lead to negative scores. company is deteriorating or wasting food and does not do anything to compensate, this leads to negative scores. If the company is deteriorating or - Shelter. houses and does not do anything destroying to compensate local communities, this leads negative scores. - Education. The extent to which the company the community with educational provides educational increases and, thereby, programs learning and earninglevels, improves capabilities, and raises economic development. in developing countries Educational programs can target essential education and literacy and access to higher education in developed countries. and Roundtable (Based on ILO, UNEP/SETAC definitions)

TOPIC AME OF SOCIAL Social/employer security and benefits N Access to basic needs for the human right to dignity (Mandatory)

GROUP Workers STAKEHOLDERS STAKEHOLDERS Local community 72 | Social Life Cycle Metrics for Chemical Products

1. Basic rights and needs ADVANCED INDICATOR 3 INDICATOR ADVANCED ADVANCED INDICATOR 2 INDICATOR ADVANCED - -

ADVANCED INDICATOR 1 INDICATOR ADVANCED

Significant # of organized stakeholder consulta tions with local community. % of community members satisfied with Increased activities in the area. company/facility’s yet made despite consid No measurable progress time, money) invested. erable efforts (resources, Company or facility can demonstrate that it does no harm to indigenous peoples’ or minority rights. group’s Company or facility can not demonstrate that it does no harm to indigenous peoples’ or minority rights. group’s Actual harm to indigenous or other minority right to land, for e.g. company/facility groups’ and/ indigenous community to relocate forces or carrying out any actions that undermine the traditional way of life a minority group. % of community members unsatisfied Increased activities in the area. with company/facility’s 2 1 0 -1 -2 Impact on the local community # of stakeholders consultations organized with local community % of the community satisfied with company/facility’s activities in the area Level of satisfaction with company/facility -

The

The chemical product The chemical product The chemical product The chemical product The chemical product does The chemical product

INDICATOR a, b,c,d,e,f,g achieved a,b,c,d achieved a,b achieved a partially achieved a,b,c,d,e,f,g not achieved Fundamental: The chemical product enables the fulfilling of basic directly need(s) and is a key component of as a the solution, which is recognized “best in the market” solution. Extensive: essential and functions are properties to fulfilling basic need(s) and is a key component of the solution. Substantial: but it does not contribute directly cannot be substituted easily without changing the contribution to fulfill basic need(s). Minor: but it is used in not contribute directly of a fun the manufacturing process damentally or extensively contributing to fulfill the basic need(s). product small to communicate: Too can be substituted chemical product without changing the contribution to fulfil the basic need(s).

2 1 0 0 -1 -2 -1 -2 +2 +1 a) The company or facility is taking action to improve a) The company or facility is taking action to improve the situation when harm to indigenous peoples’ rights is identified. b) Company or facility can demonstrate that it does no harm to indigenous peoples’ and minority rights (e.g. by having carried out an impact groups’ assessment). in place to improve c) Policies and first initiatives are rights. indigenous peoples’ and minority groups’ d) Affected rights holders have access to a grievance mechanism. and proactive e) A compliance management process to engage indigenous peoples and/or programs exist. minority groups describing the achieved f) Measurable results exist. improvements g) Affected rights holders have access to a grievance mechanism which involves dialogue and engagement. -

EXPLANATIONS EXPLANATIONS

OCIAL TOPIC DEFINITION &

S Refers to respect for indigenous peoples’ land Refers to respect rights and to other forms of cultural heritage. entitled to determine Indigenous peoples are their political status, pursue economic, social and cultural development, dispose of their and not be deprived natural resources land’s of their own means subsistence. Indigenous and prior people always need to give their free informed consent to dispose of their land with adequate compensation. It extends to the right and develop indigenous protect to preserve, and traditional knowledge systems. and Roundtable (Based on ILO, UNEP/SETAC definitions) The extent to which the chemical products and The extent to which the chemical products their application (usage) contributes to fulfilling one of the basic needs stated below: - Healthcare - Clean water & sanitation - Healthy food - Shelter - Education. Significance of the contribution. The basic needs to which the application contrib utes have to be clearly stated. The assessment then to that or these specific basic need(s). relates

TOPIC AME OF SOCIAL Respect for Indigenous rights N Direct impact on basic Direct needs GROUP STAKEHOLDERS STAKEHOLDERS Consumers Local community Social Life Cycle Metrics for Chemical Products | 73

2. Employment - - ADVANCED INDICATOR 2 INDICATOR ADVANCED Rate>=120%, greater headcount increase than headcount increase Rate>=120%, greater slower business expansion OR headcount decrease than business slowdown. headcount Rate>100% and <120%, greater than business expansion OR headcount increase slower than business slowdown. decrease Rate=100% (business expansion in line with head OR business slowdown in line with count increase headcount decrease). Rate <100% and >50% (business expansion higher OR business slowdown than headcount increase slower than headcount decrease). Rate <100% and >50% (business expansion higher OR business slowdown than headcount increase slower than headcount decrease). 2 1 0 -1 -2 The evolution of headcount relative to the business growth of to the business growth The evolution of headcount relative activity. the company’s Hn = headcount at year n Hn-1 = headcount at year n-1 = (Hn -Hn-1)/Hn-1 H= headcount growth Rn = Revenues at year n Rn-1= Revenues at year n-1 = (Rn -Rn-1)/Rn-1 R= Revenues growth Ratio in %= H/R In case of acquisition or divestment, the baseline Hn-1 (headcount at year n-1) has to be adapted take into account comparable activities between year n and n-1. This indica of work efficiency. improvement tor does not capture ADVANCED INDICATOR 1 INDICATOR ADVANCED Total number of jobs at year end (Hn) is superior by Total to total number of jobs at than 2% compared more year end (Hn-1) (job creation). previous number of jobs at year end (Hn) is superior by Total to total number of jobs at less than 2% compared year end (Hn-1) (job creation). previous number of jobs at year end (Hn) is similar to Total year end (Hn-1). total number of jobs at previous number of jobs at year end (Hn) is inferior by Total to total number of jobs at less than 2% compared year end (Hn-1) (job losses). previous number of jobs at year end (Hn) is inferior by Total to total number of jobs at than 2% compared more year end (Hn-1) (job losses). previous 2 1 0 -1 -2 Total number of jobs (in full time equivalent) Total this year along jobs created The absolute number of direct the key life cycle stages of value chain. resignation = hiring + other arrivals - layoffs Jobs created - other departures. - end of contracts retirements all along the value chain = sum of jobs Jobs created at each stage of the process. created In case of acquisition or divestment, the baseline Hn-1 (headcount at year n-1) has to be adapted take into account comparable activities between year n and n-1.

INDICATOR a,b,c,d achieved a,b,c achieved a,b achieved a and b partially achieved a,b,c,d not achieved a,b,c,d achieved a,b,c achieved a,b achieved ab partially achieved a,b,c,d not achieved

2 1 0 2 1 0 -1 -2 -1 -2 (a)The company or site(s) complies with local on workers’ health and safety. regulations (b) The occupational health of the personnel is Adequate inventories and relevant monitored. information on the health risks of all substances availa,ble. handled at the company or site(s) are availa,ble for all (c) Health risk assessments are the toxicity of all concerned functions regarding handled at the company or chemicals/products site(s). based on the risk assessments are (d) Measures the health of workers. implemented to protect are (e) International occupational hygiene standards limits when local used as occupational exposure insufficient. are standards (f) Safer chemical alternatives—beyond compliance— needed, new have been implemented and, where installations are built. (a) The company does not violate laws when but has no specific processes reorganizing Example: the company does not help workers to a job. recover (b) The company complies with local laws in terms of reorganization. company’s to help workers Example: existence of programs framework. jobs following local regulatory recover to offering significant (c) The company is prone victims of compensation to workers who are Example: The company is transparent reorganization. in negotiations with major stakeholders (unions, workers, local communities, governments) on leave premium. (d) The company has formalized a strategy to mitigate the impact of reorganizations Example: major stakeholders (unions, workers, local associated with communities, local governments) are to find alternative solutions to layoffs (position offer on etc.) other sites, funding of training programs,

EXPLANATIONS EXPLANATIONS OCIAL TOPIC DEFINITION & S Employment effects are Employment effects are company’s through measured management of activity (layoffs, reorganization disinvestment, closing down, etc.). Employment effects of the defined in terms of company are job creation. the Employment improves economic livelihood of the and their families. workforce Employment also creates ripple effects of sustainable the development across New jobs created community. additional new individual are jobs or headcount, this does not include the replacement of workers who have left the company. The total number of job refers to full-time equivalent (FTE) and for the reporting is considered period and the given functional unit of the assessment.

TOPIC (Mandatory) Job creation reorganization AME OF SOCIAL Management of N

GROUP Workers STAKEHOLDERS STAKEHOLDERS Local communities 74 | Social Life Cycle Metrics for Chemical Products INDICATOR NGOs, laws, EU directives, (eco)labels, WHO NGOs, laws, EU directives, a,b,c,d achieved a,b,c,d achieved a,b,c,d achieved a,b,c,d achieved a,b,c,d not achieved 2 1 0 -1 -2 a) No negative signals exist and existence of weak (not documented enough) positive signals. as having a positive impact is generally recognized b) The product well-being on the consumer’s c) A company-specific study is available. method in the d) A study following a published and recognized experience is available. That publication shows field of product that the positive impact would be less without intermediate under study. product of signals: Sources association of consumers, scientific and recommendations, customers and market advertisements medical literature, EXPLANATIONS OCIAL TOPIC DEFINITION & S Subjective product experience that Subjective product goes beyond the utilitarian function This can be defined of a product. of the effects as the awareness interaction with from resulting (emotions, comfort, etc.). products. Basic needs as defined earlier in this excluded from this guideline are indicator. options are: Measurement - Consumer experience (through enquiries, panels, surveys). to - Consumer behavior (reaction satisfaction/ dissatisfaction). - Company practices to account for consumer experience. (feedback mechanism in place, level of information to consumers, transparency). the added Because of its nature, this indicator lays value of reporting only on the positive effects. Negative likely to be handled in a effects are way (legislation, consumer different the scale withdraw). For this reason for this indicator starts at level 3: Acceptable situation. OCIAL TOPIC NAME S Consumers’ product experience Consumers’ product GROUP TAKEHOLDERS TAKEHOLDERS S Consumers Social Life Cycle Metrics for Chemical Products | 75

3. Health & Safety 2 ADVANCED INDICATOR INDICATOR ADVANCED

ADVANCED INDICATOR 1 INDICATOR ADVANCED Health performance > x% better than industry average. Health performance>y% better than industry average. Health performance at industry average. Health performance >y% worse than industry average. Health performance> x% worse than industry average. 2 1 0 -1 -2

Results of the health risk assessment Example: Health performance index (confirmed occupational diseases, medical emergency drills, medicine and health first aid training, preemptive promotion).

INDICATOR a,b,c,d,e,f achieved a,b,c,d,e achieved a,b,c,d achieved a NOT achieved, bcd partially implemented a,b,c,d,e,f NOT achieved

2 1 0 -1 -2 (a)The company or site(s) complies with local on workers’ health and safety. regulations (b) The occupational health of the personnel Adequate inventories and is monitored. information on the health risks of all relevant substances handled at the company or site(s) availa,ble. are availa,ble for (c) Health risk assessments are the toxicity all concerned functions regarding handled at the of all chemicals/products company or site(s). based on the risk assessments (d) Measures the health of implemented to protect are workers. (e) International occupational hygiene used as occupational exposure are standards insufficient. are limits when local standards (f) Safer chemical alternatives—beyond compliance—have been implemented and, where needed, new installations are built.

EXPLANATIONS

OCIAL TOPIC DEFINITION & S Definition: Occupational health incidents exposure. of repeated the result are illnesses leading to Includes work-related permanent impairment (complete or partial) of physical or mental capacity (disa,bility). (Based on OSHA definition.) The purpose of occupational health is the and maintenance of the highest promotion of physical, mental and social degree well-being of workers in all occupations; of workers leaving their the prevention of ill health caused jobs on the grounds by their working conditions; the protection at work of workers against risks incurred of factors detrimental to health; as a result the placing and maintenance of workers adapted in an occupational environment to their physiological and psychological into capa,bilities; taking gender differences account and, to summarize, the adaptation of work to each person and to his/her job (based on ILO/ WHO 1950 definition). the management Under this sub-category, of occupational health risks means that the company or facility carries out risk assessments and implements appropriate or mitigate hazards to prevent measures and/or risks.

NAME (Mandatory) OCIAL TOPIC S tional health risks Workers’ occupa Workers’

GROUP Workers Workers TAKEHOLDER TAKEHOLDER S 76 | Social Life Cycle Metrics for Chemical Products

3. Health & Safety 2

ADVANCED INDICATOR INDICATOR ADVANCED HST> x% better than industry average. HST>y% better than industry average. HST at industry average. HST >y% worse than industry average. HST> x% worse than industry average. 2 1 0 -1 -2 Answer format: whole number Only if there is industry standard that can be referenced Average number of hours health and safety training per Average year per worker (HST)

so called “frequency so called “frequency

ADVANCED INDICATOR 1 INDICATOR ADVANCED FI > x% better than industry average. FI >y% better than industry average. FI at industry average. FI >y% worse than industry average. FI > x% worse than industry average. AR > x% better than industry average. AR>y% better than industry average. AR at industry average. AR >y% worse than industry average. AR> x% worse than industry average. 2 1 0 2 1 0 -1 -2 -1 -2 Sickness a,bsentee rate: Refers to a measure of Sickness a,bsentee rate: Refers to a measure actual a,bsentee days lost attributed to sickness, of total days scheduled to as a percentage expressed for the same period. be worked by the workforce SAR = Sickness a,bsence days ÷ FTE workdays rate of safety incidents Frequency period, also called Injury index (FI)” in the reporting relative to of injuries rate (GRI definition: frequency in the the total time worked by workforce period). reporting for determining the average rate of A uniform measure the value chain. incidents should be applied across the ones with at The accidents to be integrated are least 1 day of work stoppage. The ratio should be for 1,000,000 working hours. presented

INDICATOR a,b,c,d,e achieved a,b,c,d achieved a,b,c achieved a or b c NOT achieved a,b,c,d,e NOT achieved a,b,c,d,e achieved a,b,c achieved a,b achieved a NOT achieved, bc partially implemented a,b,c,d,e NOT achieved

2 1 0 2 1 0 -1 -2 -1 -2 (a) A formalized process is in place to assess (a) A formalized process and document individual worker occupational to the to activities related health risks related of the company being assessed, product chemicals. to hazardous including exposure (b) Any worker potentially exposed to occupational health risks undergoes regular by the company. medical monitoring provided (c) Any worker exposed to risks and bearing women) is specific weaknesses (i.e. pregnant systematically moved to less risky functions. general in place to promote are (d) Programs health, such as advice, general medical check- programs. ups, health awareness in health (e) Measura,ble improvement in past years condition of workers is proven of epidemiological studies, (e.g. results number of occupational diseases reduced or of deaths due to occupational diseases, life expectancy) improved (a) The level of safety incidents is measured set. targets are and reduction for safety (b) Duties and lines of responsibility defined. are workers (c) The company or facility provides training in line with adequate safety awareness of their job function and with the requirements including on the use local legal requirements, equipment. of any essential personal protective is availa,ble in the Such training or awareness local language and updated periodically. in occupational (d) Measura,ble improvement over the past safety performance is proven four years. (e) Continuous design, development and in place, are of safety programmes review involving workers.

EXPLANATIONS OCIAL TOPIC DEFINITION & S Definition: Safety incidents are single events Definition: Safety incidents are in injury and include impairment resulting (complete or partial) of physical mental capacity (invalidity). (Based on OSHA.) All workers have the right to a safe of serious recognized workplace free This topic assesses both the rate hazards. of incidents and the status prevention and management practices. measures Under this topic, management of workers’ workers individual health includes providing such as with occupational health programs, to medical monitoring for (potential) exposure chemicals; and/or general health hazardous that provide or vitality programs awareness health services such workers with preventive as general medical check-ups. The term “health” in this context is meant to include both physical and mental health, as defined by the WHO.

health NAME OCIAL TOPIC S Management of workers’ individual Safety management system for workers (Mandatory)

GROUP Workers Workers TAKEHOLDER TAKEHOLDER S Social Life Cycle Metrics for Chemical Products | 77

3. Health & Safety 2 ADVANCED INDICATOR INDICATOR ADVANCED

ADVANCED INDICATOR 1 INDICATOR ADVANCED Zero records of public complaints. records Zero and corrective with appropriate Records actions. preventive handled with a,b,c. Records of public complaints without Records action. corrective At least one lawsuit. 2 1 0 -1 -2 Number of records of public complaints due to Number of records chemical substance releases in the “well-being” treated Note: Nuisances are section INDICATOR

a,b,c,d,e achieved a,b,c,d achieved a,b,c achieved a NOT achieved, b or c partially achieved a,b,c,d,e NOT achieved

2 1 0 -1 -2 (a) No harm induced by your own company identified. (b) Risks and impacts on community health via impact monitored regularly and safety are assessments. and to prevent measures c) Appropriate implemented, mitigate adverse impact are of health and safety including the provision information. d) Health and safety committee or other body has been set up to deal with impacts in the local community. (e) The company or facility takes proactive and steer improvements actions to measure based in community health and safety, on stakeholder engagement and local communities’ needs.

EXPLANATIONS OCIAL TOPIC DEFINITION & S The extent to which the company or and mitigate facility works to prevent positive adverse impacts or even create impact by its own company activities on the health and safety of local community associated with the extraction of raw materials and the manufacturing, distribution and end-of-life of the product, with particular attention to vulnera,ble such as indigenous peoples and groups women. This includes committing to and continuous performance improvement interaction with the communities in which located (based on the chemical facilities are PRé Handbook definition).

NAME OCIAL TOPIC S Health and safety of local community’s living conditions (Mandatory) GROUP TAKEHOLDER TAKEHOLDER S Local communities 78 | Social Life Cycle Metrics for Chemical Products

3. Health & Safety -

2 , acknowledged by a certifica ADVANCED INDICATOR INDICATOR ADVANCED Undisputed, externally supported, positive contribution to target market health and safety. of risk diseases, (e.g. measura,ble reduction effects, maintenance of health, regenerative to markers of human health impact related diseases). blood pressure, health such as DALY, on Evidence of positive effect product end-user health or safety. No effect known to the health of end-user in defined target market. Potential (unintended) negative effects of on end-user health or safety, the product accidentally. Unintended or negative effects of the product on end-users’ or their families’ health safety, supported by evidence. accidentally, 2 1 0 -1 -2 Product’s (intended or unintended) contribution to the Product’s end-users health and safety body or independent research. tion, or accreditation

ADVANCED INDICATOR 1 INDICATOR ADVANCED GPS number > x% better than industry average. GPS number>y% better than industry average. GPS number at industry average. GPS number >y% worse than industry average. GPS number> x% worse than industry average. 2 1 0 -1 -2 Global product safety summaries: Number of Global product Strategy) publicly availa,ble GPS (Global Product safety summaries (high-level summary intended the general public with an overview of to provide safety for a specific substance) product specific, but is necessarily The GPS is not product at company level addressed See the ICCA GPS information portal http://www.icca-chem.org/en/Home/Global- Product-Strategy/global-product-strategy/chemical- information-search/

INDICATOR

a,b,c,d,e,f,g achieved a,b,c,d,e a,b,c,d achieved a or b c NOT achieved and g achieved a,b,c,d,e,fg not achieved

2 1 0 -1 -2 (a) The product is labelled for safe handling (a) The product and disposal. an in place to recall is a procedure (b) There unsafe product. is risk assessed for consumer (c) The product application and the key use in the considered outcome is availa,ble in the Safety Data Sheet or other compara,ble publications. has not generated disease, (d) The product accident or injury in its intended application. to (e) Positive contribution of the product consumer health and safety is expected (excluding intended basic functions) to (f) Positive contribution of the product consumer health and safety (excluding intended basic functions) has been proven. the public with (g) The company provides additional safety & health information or the safe handling of training to ensure product

EXPLANATIONS

OCIAL TOPIC DEFINITION & S Products are expected to perform their are Products intended functions satisfactorily and not pose a risk to consumer health and safety. both risks This social topic addresses and the positive impacts that products may have on the health and safety of (based on PRé end-users of products Handbook definitions). both risks and This social topic addresses may the positive impacts that products have on the health and safety of end- beyond their intended users of products, functions.

NAME OCIAL TOPIC S Impact on consumer’s health and safety (Mandatory)

GROUP Consumers TAKEHOLDER TAKEHOLDER S Social Life Cycle Metrics for Chemical Products | 79

4. Skills & knowledge - - ADVANCED INDICATOR 3 INDICATOR ADVANCED More than 50% better reference. Better than reference, but in a range. Perfor mance is > 0% but less than or equal to 50% improvement compared to reference. Performance is equal to reference for studied performance indicator. than reference, but in a range. Per Worse formance is less than or equal to 50% worse compared to reference. Performance is more than 50% worse reference. 2 1 0 -1 -2 Access to paid education leave: Percentage of workers provided paid education leave, by gender and category As per ILO convention, term paid educational leave means leave granted to a worker for educational purposes for a specified period during working hours, The ILO Paid with adequate financial entitlements. Educational Leave Convention, 1974 (No. 140) considersthat continuing education and training related to scientific and technological development the changing pattern of economic and social relations calls for adequate arrangements leave education and training to meet new aspirations, needs and objectives of a social, economic, technological and cultural character. Paid educational leave should be regarded as one means of meeting the real needs individual workers in a modern society. Paid educational leave should be conceived in terms of a policy continuing education and training to be manner. implemented progressively and in an effective Example: 3% of female workers were provided paid educational leave in 2013. Formula: percentage of worker provided paid number of worker Total educational leave (%) = provided paid educational leave in each category/Total number of workers in category x 100 More than 50% better reference. More but in a range. Better than reference, Performance is > 0% but less than or compared equal to 50% improvement to reference. for Performance is equal to reference studied performance indicator. but in a range. than reference, Worse Performance is less than or equal to 50% to reference. worse compared than 50% worse Performance is more than reference. ADVANCED INDICATOR 2 INDICATOR ADVANCED 2 1 0 -1 -2 Amount of financial capital invested in worker period. training and education during the reporting equivalent of worker as a percentage Represented remuneration. human capital, particularly Maintaining and improving training that expands the knowledge through base of workers, is a key element in organizational development. this aspect quite Performance indicator 1 captures insight into the scale of well but does not provide financial capital investment to develop organization’s to which the investment human capital and the degree worker base. the entire is made across Category-wide assessment demonstrates the extent the to which the system is applied throughout is inequality of access to organization and if there these opportunities. Example: Financial capital investment in worker training and education for middle management level in this was equivalent to 3% of worker remuneration category in 2013. of Formula: Financial capital invested as a percentage (%), per worker category worker remuneration financial investment in training and education = Total of remuneration to each category of workers/Total workers in category x100 -

More than 50% better More reference. but in a Better than reference, range. Performance is > 0% but less than or equal to 50% to compared improvement reference. Performance is equal for studied to reference performance indicator. but in a than reference, Worse range. Performance is less than or equal to 50% worse com to reference. pared than 50% Performance is more worse than reference. ADVANCED INDICATOR 1 INDICATOR ADVANCED 2 1 0 -1 -2 Average hours of training that the organization’s hours of training that the organization’s Average workers have undertaken during the reporting period, by: Gender and worker Category human capital, Maintaining and improving training that expands the particularly through knowledge base of workers, is a key element in organizational development. insight into the scale This indicator provides investment in this area of the organization’s to which the investment is and the degree worker base. Data on the entire made across number of training hours is available, in general, departments of an with the human resource organization. Access to training opportunities can also of social in other areas support progress performance, such as ensuring equal opportunity in the workplace. It also contributes at the personal and to motivating improvement organizational level. Example: 30.5 hours of average training per male worker in 2013. Formula: training hours per worker category Average = to each number of training hours provided Total number of workers category of workers/Total in category INDICATOR b,c,d,e,f,g achieved b,c,d achieved b achieved a achieved a,b,c,d,e,f,g not achieved 2 1 0 -1 -2 a) Programs and actions for skill development a) Programs with regulatory and training not in accordance and actions do The programs requirements. the skill level of its workers for not improve of use within the company and a decrease workers’ employability within the larger market is observed. and actions for skill development b) Programs with regulatory and training in accordance the that maintain and improve requirements skill level of its workers for use within the in workers’ a decrease However, company. employability within the larger market is observed. and actions for skill development c) Programs requirements and training beyond regulatory the skill level of its that maintain and improve workers for use within the company. for skills management and d) Programs lifelong learning that support the continued employability of its workers and assist them from endings resulting in managing career or termination of employment. retirement assistance to upgrade worker skills, Provides including vocational trainings and has paid education leave policy. and actions for skill development e) Programs requirements and training beyond regulatory employability of workers in the that create larger market. f) Periodic assessments and implements its skills to improve measures appropriate management program. training and education program g) Measures for tier 1 & 2 suppliers. & EXPLANATIONS & EXPLANATIONS Programs for skills management Programs allow organizations to plan skills acquisition that will equip workers to meet strategic targets in a A changing work environment. and strategy program strong on continuous development of workers and improvement skills and knowledge would skill in higher productivity, result levels and motivated workforce. Companies have different types and level of training for and education programs these have different workforce; impacts on skill development, enhancement, career productivity advancement possibilities and in employability of its workforce larger market. indicator on A process “Management of skills and knowledge” for workers category tries to find answers following questions: 1) Does the company have for skills management programs and lifelong learning that support the continued employability of its workers and assist them endings in managing career or retirement from resulting termination of employment? 2) Does the company or facility carry out assessments and measures implement appropriate its skills management to improve program? 3) What is the type and scope implemented and of programs to upgrade assistance provided worker skills, including vocational training? 4) Does the company have a paid education leave policy? If yes, what is the scope and level of the program? 5) Does the company measure training and education programs for its tier 1 & 2 suppliers? SOCIAL TOPIC DEFINITION

AME OF N SOCIAL TOPIC Skills, knowledge and employability (Mandatory)

Workers GROUP STAKEHOLDER STAKEHOLDER 80 | Social Life Cycle Metrics for Chemical Products

4. Skills & knowledge ADVANCED INDICATOR 3 INDICATOR ADVANCED

More than 50% better reference More but in a range. Better than reference, Performance is as good as, but less than compared or equal to 50% improvement to reference for Performance is equal to reference studied performance indicator but in a range. than reference, Worse Performance is less than or equal to 50% to reference worse compared than 50% worse Performance is more reference ADVANCED INDICATOR 2 INDICATOR ADVANCED 2 1 0 -1 -2 Amount of financial capital invested Amount of financial capital invested in community period. training and education during the reporting of total worker as a percentage Represented remuneration. insight into the scale Quantitative indicator provides financial investment to develop of the organization’s human capital. inequality of access This indicator does not capture access to these opportunities, extent of pre-existing value of money to education and training or relative it should be kept Further, spent in local community. in mind that the level of local economic development from of the evaluated community may be different sales, the community in which company’s located. headquarters or main operations are Formula: Financial capital invested as a percentage financial (%) = Total of total worker remuneration investment in community training and education/Total salary of workers in category * 100%

Capacity-building initiatives have documented positive effect on local literacy or numeracy rates and/or economic strength Capacity-building initiatives have non-measurable positive effect on local literacy or numeracy rates and/or economic strength Capacity-building initiatives have no effect Capacity-building initiatives have possible detrimental effect Capacity-building initiatives have documented detrimental effect on literacy or numeracy rates and/or economic strength

ADVANCED INDICATOR 1 INDICATOR ADVANCED 2 1 0 -1 -2 Evidence of positive outcome existing community training and education programs evidence firmly establishes that a “Available combination of good education with training to the that is of good quality and relevant labor market: - Empowers people to develop their full capacities and to seize employment social opportunities; both of workers and - Raises productivity, enterprises; innovation and - Contributes to boosting future development; - Encourages both domestic and foreign lowering investment, and thus job growth, unemployment and underemployment; - Leads to higher wages; accessible, expands labor market - When broadly social inequalities.” opportunities and reduces (ILO, 2010)

INDICATOR

a,b,c,d achieved a,b,c achieved a,b achieved a achieved a,b,c,d, not achieved 2 1 0 -1 -2 a) Opportunities to build human capacity in the identified but no initiative that community are targets capacity building is undertaken. b) Capacity-building initiatives that target undertaken on an community members are ad hoc basis. general c) Capacity building through community education initiatives that target community members is ongoing with guidelines and timelines. transparent formal programs d) Capacity building through that target community members is ongoing guidelines and timelines. with transparent

& EXPLANATIONS & EXPLANATIONS Handbook on Social Impact “The extent to which the company or facility works to contribute the long- term development of local communities by enhancing and unlocking their human potential access improved through to knowledge, information, technology and skills.” ( Assessment (PRé Sustainability, 2014) “A good skills development system will be able to: anticipate skill needs; maintain the quality of training; make and relevance training accessible to all sectors viable and of society; ensure equitable financing mechanisms; and continuously evaluate the economic and social outcomes of training...” Effective education efforts: with social coordinated - Are industrial, investment, protection, and trade policies; - Facilitate access to training and education by individuals by various hindered and groups barriers, including poverty and low income, ethnic origin, and migrant disability, gender, status. References: for Strong, A Skilled Workforce Sustainable and Balanced Strategy A G20 Training Growth: (ILO, 2010). Opportunities for addressing educational challenges occur business operations, in core advocacy and/ philanthropy, or public policy engagement, and partnerships. A Framework for Business Engagement in Education 2013 (UN Global Compact, 2013). for the development of [Source the indicator is Handbook on Social Impact Assessment (PRé 2014)] Sustainability, SOCIAL TOPIC DEFINITION AME OF N SOCIAL TOPIC Promotion of skills Promotion and knowledge GROUP STAKEHOLDER STAKEHOLDER Local community Social Life Cycle Metrics for Chemical Products | 81

4. Skills & knowledge ADVANCED INDICATOR 3 INDICATOR ADVANCED

More than 50% better reference. More but in a range. Better than reference, Performance is as good as, but less than compared or equal to 50% improvement to reference. for studied Performance is equal to reference performance indicator. but in a range. than reference, Worse Performance is less than or equal to 50% to reference. worse compared than 50% worse Performance is more reference. ADVANCED INDICATOR 2 INDICATOR ADVANCED

2 1 0 -1 -2 organization’s financial investment to develop human organization’s Quantitative indicator provides insight into the scale of Quantitative indicator provides the capital. inequality of access to This indicator does not capture these opportunities. gain

recognized to be above recognized Consumer education provided by Consumer education provided entity is helping consumers to due advantages in cost or profit by the to the information provided able to are Users of product entity. assess the added value for their the product lives gained through to other alternatives. compared by Consumer education provided entity is average in the industry. customers or No complaints from information end users on product No unresolved have been received. public authorities from requests consumer or media to improve information is pending. customers or Complaints from information end users on product not and are have been received requests - or unresolved resolved public authorities or media to from consumer information are improve pending. customers or end Complaints from users on damages caused by lack information product of or incorrect not and are have been received public Or unresolved resolved. authority or media investigations for pending. such cases are ress issues, if any. This is achieved by issues, if any. ress d ADVANCED INDICATOR 1 INDICATOR ADVANCED 2 1 0 -1 -2 Evidence of positive outcome existing education action taken or enabled by entity to be achieved by consumer education The result able to use the product is that consumers are to use it safely and be in their best interest, able to ad conveying information to consumers based on the initiative of the entity (see definition). the The performance indicators shall thus measure success and to how what extent it is caused by educative action taken or enabled by the entity.

INDICATOR risk of b not achieved for a LC Stage a,b,c,d achieved a,b,c achieved a,b achieved a achieved a,b,c,d not achieved

2 1 0 -1 -2 Risk filter a) Programs and actions for consumers are and actions for consumers are a) Programs in place but do not meet applicable laws and standards. omitting to place a Example: Car manufacturer necessary safety warning. in and actions for consumers are b) Programs information and knowledge place that create for consumers in line with applicable law and standards. Example: Chemicals company informing user of safely. on how to use product its products and actions for consumers are c) Programs all information and skills in place that provide safely and in the best necessary to use product him with and that provide of the customer, interest access to help in case of issues. Example: Power supply company providing cooking courses to customers enable economical use of power (gas, electricity). in and actions for consumers are d) Programs information and knowledge that place that create and situations. transferable to other products are chain informing store Example: Grocery and levels consumers about quality features of vegetables and how to of food (freshness recognize)

& EXPLANATIONS & EXPLANATIONS SOCIAL TOPIC DEFINITION Consumer education is the of an individual through preparation skills, concepts and understanding for everyday living required that are to achieve maximum satisfaction and sustainable use of resources. It is defined as education given to the consumer about various consumer goods and services, covering price, what the consumer trade practice, can expect, standard and economic social, environmental and education about the product its effects, etc. Such information magazines, through may be relayed of word websites or pro-consumer mouth. In some locations it is part of school training. such training addresses Typically pricing, safety, properties, product and to possibilities to be heard redress. advantages for The corresponding sufficient to receive consumers are information to assess and use the to use in their best interest, product it safely and to be able address This may increase issues, if any. customer satisfaction and reduce disappointment and risk of litigation. AME OF N SOCIAL TOPIC Promotion of Skills and Knowledge

GROUP Consumers STAKEHOLDER STAKEHOLDER 82 | Social Life Cycle Metrics for Chemical Products

5. Well-being Absence rate stable, lower than 5%. to half in the past 5 years. Absence rate decreased No information available. Absence rate stable, lower than 10%. Absence rate doubled in the past 5 years. -

ADVANCED INDICATOR 1 INDICATOR ADVANCED

More than 75% of workers state to be satisfied or More than 75% of maximal enquiry very satisfied. Or more score. Between 51% and 75% of the workers state to be satisfied or very satisfied. Or between 51% and 75% of maximal enquiry score. 51% of the workers state to be satisfied or very satisfied. Or 51% of maximal enquiry score. Between 25% and 51% of the workers state to be satisfied Or between 25% and 51% of maximal enquiry score. Less than 25% of the workers state to be satisfied. Or 25% of maximal enquiry score. Measurable progress due to actions undertaken exist. Measurable progress yet made despite consider No measurable progress time, money) invested. able efforts (resources, of complaints. Drastic reduction included into a Demonstration that all complaints are action plan. corrective recorded Accidental nuisance to local community, complaints. through through recorded Actual nuisance to local community, complaints and no actions taken to implement actions. corrective 2 1 0 2 1 0 -1 -2 -1 -2 Job satisfaction survey of workers who state in a job satisfaction and/ Percentage or externalsatisfied and/ engagement survey that they are or engaged with working for the company one of its subsidiaries. of the workers involved in The survey should be representative its raw materials under study, the manufacturing of product than consumers). Aspects to be and its application (if different geography and time. are representative Nuisance management The extent to which actual and potential nuisances due the taken into account and reduced. activity are

INDICATOR

a,b,c,d,e,f,g achieved a,b,c,d,e achieved a,b,c,d achieved a,b achieved a,b,c,d,e,f,g not achieved a,b,c,d,e achieved a,b,c achieved a,b achieved a achieved a,b,c,d,e not achieved

2 1 0 2 1 0 -1 -2 -1 -2 a) The activity does not generate recurrent nuisances (highly a) The activity does not generate recurrent unpleasant odors or heavy traffic). noisy activities, regularly but considered, exist, odors are b) Plans for noise reduction are not with no significant effect yet and accidental situations taken into account accidental situations undertaken to prevent c) Actions are d) The company generates no harm to local communities integrated so as to comply with but potential nuisances are regulations. current order to limit e) Efficient equipment has been installed in noise levels (for noisy activities). and noise is considered f) Actual and potential odors are for activity taken into account in risk assessment of projects extension. has been built by the company or facility to g) Infrastructure separate local traffic and activity traffic. a) The company or site(s) was not involved in legal initiated by employee(s) against the company proceedings period. during the reporting within the company or site in worker b) No case of breach no access to representative (no access to social worker, care bodies, evidence of absence dialog with the management). are c) A non-formal survey is in place and results communicated to top management. d) A formal survey has been in place for several years and communicated to top management and shared are results The survey is updated periodically. within the company. analyzed and action of the survey are e) Criteria and results the situation. A “Plan Do to improve built in order plans are is in place, and workers’ satisfaction a Check Act” process policy. element of the company’s recognized

OCIAL TOPIC DEFINITION & EXPLANATIONS S This indicator measures the impact on local This indicator measures communities of the noise, odors, dust and traffic generated by the site in its vicinity. to the chemical itself Note: Nuisances related not and its potential harmful effects or toxicity are integrated in this category (but under the health & safety section) Measure the feeling of satisfaction or engagement Measure job and employer. with one’s Specific topics like work-life balance, wages and benefits contribute to the overall feeling of enhance satisfaction and/or engagement. To pragmatism we look at this as a whole. options are: Measurement enquires) experience (through - Workers’ behavior ( absenteeism, turnover rates, - Worker etc.) support, - Company practices (training, career enquiry systems, etc.) to what extent indicator: measures Process and managed workers’ satisfaction is considered OCIAL TOPIC NAME Nuisance reduction (noise, odors, traffic) S Job satisfaction

GROUP Workers STAKEHOLDERS STAKEHOLDERS Local communities Social Life Cycle Metrics for Chemical Products | 83

5. Well-being ADVANCED INDICATOR 2 INDICATOR ADVANCED ADVANCED INDICATOR 1 INDICATOR ADVANCED A budget is proactively and recurrently attributed to and recurrently A budget is proactively involved local development actions and workers are in actions. paid upon budget, but contributions are No provisional after negotiation. request attributed to local No budget and no participation are development actions. local development. Negative position towards the activity prevents Because of conflicting interests, development in the local community. 2 1 0 -1 -2 Budget attributed to local development actions

INDICATOR

e,f achieved e achieved d achieved b, c achieved a achieved a,b,c,d achieved, a,b achieved and c,d partially a achieved and b,c,d partially a NOT achieved, b,c,d partially achieved a,b,c,d not achieved a,b,c,d achieved a,b,c achieved a,b,c achieved a,b,c achieved a,b,c,d not achieved

2 1 0 2 1 0 2 1 0 -1 -2 -1 -2 -1 -2 a) It is part of the strategy to not participate in local development. b) Not in conflict with local community networks and for development. programs neither initiated by the site, nor c) No interaction; contacts are by the community. d) The activity does not interact with the local community but also does not have a negative impact on local development. with identified priorities, the company or e) In accordance facility participates in the life of various networks active locally. f) The activity develops initiatives in conjunction with local role. networks, playing a proactive a) No incidents harming local services. access to basic needs for in place to improve b) Policies are sustainable development. First initiatives have started. is made and it a permanent c) Measurable improvement with the local community. benefit to be shared a grievance mechanism or other d) Company or facility provides feedback loop for the local community. a) No negative signals exist and existence of weak (not docu mented enough) positive signals. as having a positive is generally recognized b) The product well-being impact on the consumer’s c) A company-specific study is available. method in the d) A study following a published and recognized experience is available. That publication shows field of product that the positive impact would be less without intermediate under study. product (eco)labels, WHO of signals: NGOs, laws, EU directives, Sources association of consumers, scientific and recommendations, customers and market advertisements medical literature,

OCIAL TOPIC DEFINITION & EXPLANATIONS S This indicator measures the involvement of This indicator measures for time) in local programs the site (money, the development of, for example, culture, entertainment and sport. This indicators also between the of relationship the degree measures site and the local community. with local Note: Other aspects of relationships under the “access to treated communities are basic needs” and the “health & safety” section The extent to which a contribution is made : bridges, (e.g. roads, - Local transport/infrastructure public transport). If the company is blocking access to transport, this leads negative scores. - Access to information and telecommunications services. If the company is deteriorating local communities’ access to information and telecommunications services and does not do anything to compensate, this leads negative scores. If the company - Access to (modern) energy. existing energy- is deteriorating or destroying services, this leads to negative scores. provision and Roundtable (Based on ILO, UNEP/SETAC definitions) experience that goes beyond Subjective product This can be the utilitarian function of a product. resulting of the effects defined as the awareness (emotions, comfort, interaction with products. from etc.). Basic needs as defined earlier in this this indicator. excluded from guideline are options are: Measurement enquiries, panels, - Consumer experience (through surveys). to satisfaction/ - Consumer behavior (reaction dissatisfaction). - Company practices to account for consumer experience. (feedback mechanism in place, level of information to consumers, transparency). the added value of reporting Because of its nature, this indicator lays only on the positive effects. likely to be handled in a Negative effects are way (legislation, consumer withdraw). For different the scale for this indicator starts at level this reason 3: Acceptable situation. - OCIAL TOPIC NAME Developing with relationship local communities Access to basic needs for sustain able development product Consumers’ experience S GROUP Consumers STAKEHOLDERS STAKEHOLDERS Local community Local communities 84 | Social Life Cycle Metrics for Chemical Products

Appendix 5. Criteria to be applied for the risk filter to select key life cycle stages The following list of criteria is intended to be used as stages and justify the inclusion or exclusion of stages an option to support the selection of key life cycle from the scope of the boundaries.

STAKEHOLDER SOCIAL AREA SOCIAL TOPIC RISK FILTER CRITERIA

Workers’ occupational health risks a) Compliance with local regulations of the concerned site(s) is ensured.

a) A formalized process is in place to assess and document individual worker occupational health Management of workers’ individual health risks, related to all activities of the company, including exposure to hazardous chemicals. Health & safety a) The level of safety incidents is measured and reduction targets are set; b) Duties and lines of responsibility for safety are defined; c) The company or facility provides workers with adequate safety awareness training in line with Safety management system for workers the requirements of their job function and local legal requirements, including on the use of any essential personal protective equipment. Such training or awareness is available in the local language and updated periodically.

a) Compensation management system, salary structure and description of legal/industry minimum Fair wages wage exist and are documented.

a) Policies against child labor, a compliance management process and proactive programs to No child labor actively engage in banning child labor exist. No forced labor, human trafficking c ) Company provides access to remedy. and slavery c) Company respects national law or industry standards on working hours, breaks and public Basic rights & needs Appropriate working hours Workers holidays. Freedom of association, collective a) Workers and/or employers do have the right to form and join organizations of their own choice bargaining and labor relations No discrimination c) Company complies with national law or industry standards. a) Policies in reporting company exist; Social/employer security and benefits b) company provides a minimum standard of social security in terms of health care and income security. a) The company or the site hasn’t lost any lawsuit in the past 12 months against workers (recidi- vism); Well-being Job satisfaction b) No case of breach within the company or the site in worker care (no access to social worker, no access to representative bodies, evidence of absence of dialog with the management) a) The company does not violate laws when reorganizing but has no specific processes Example: the company does not help workers to recover a job. Employment Management of reorganization b) The company complies with local laws in terms of company’s reorganization. Example: existence of programs to help workers recover jobs following local regulatory framework. Skills, knowledge c) Programs and actions for skill development and training in accordance with regulatory require- Skills & knowledge and employability ments that maintain the skills of the people at a level that is marketable. a) No harm induced by the company identified b) Risks and impacts on community health and safety are regularly monitored via impact Health & safety Healthy & safe living conditions assessments. c) Appropriate measures to prevent and mitigate adverse impact are implemented, including the provision of health and safety information Access to basic needs for human dignity b) Company or facility can demonstrate that it does no harm to the local community’s access to (healthcare, sanitation & clean water, basic needs for the human right to dignity (e.g. by having carried out an Impact assessment). Basic rights & needs healthy food, shelter, education) b) Company or facility can demonstrate that it does no harm to indigenous people’s rights (e.g. by Indigenous’ rights having carried out an Impact assessment). Access to basic needs for sustainable Local communities development (infrastructure, ICT, a) No harm to local services. modern energy) Well-being d) The company generates no harm to local communities but potential nuisances are integrated Nuisance reduction so as to comply with current regulation. Developing relationships with local b) Not in conflict with local community networks and programs for development. communities a) The company is not responsible for a severe breach of fair employment management but does Employment Job creation not respect its commitments in terms of headcount reporting. a) Opportunities to build human capacities in the community are identified; Skills & knowledge Promotion of skills & knowledge b) Capacity-building initiatives that target community members are undertaken on an ad hoc basis. a) The product is labelled according to legislation for safe handling and disposal; b) There is a procedure in place to recall an unsafe product; Health & safety Healthy & safe products c) The product is risk assessed for consumer use and the key outcome is available in a Safety Data Sheet.

Basic rights & needs Direct impact basic needs Consumers a) Negative signals exist, with existence of weak (not documented enough) positive signals , Well-being Consumers’ product experience balance oriented towards negative signals. Employment

b) Programs and actions for consumers are in place that create information and knowledge for Skills & knowledge Promotion of skills & knowledge consumers in line with applicable laws and standards. Social Life Cycle Metrics for Chemical Products | 85

Appendix 6. Report template for chemical product social assessment The following template is to be used to report chemical product social impact according to the present guide. >> Title of the study >> Commissioner and performer of the study >> Date of the report >> Specifications/contact list to access the detailed methodological report 1. Scope 1.1 Goal & scope of the study 1.2 Functional unit 2. Methodological choices 2.1 Selection of social topics 2.2 Choice of indicators & reference scale setting 2.3 Boundary setting 3. Data sources 4. Results and interpretation 4.1 Results and conclusions 4.2. Limits and uncertainties 4.3 Peer reviewer comments 5. Quality assessment 6. Conclusion 7. References 86 | Social Life Cycle Metrics for Chemical Products

Appendix 7. Gap analysis with existing literature Table describing the key subjects differentiating this WBCSD guide from existing guidance:

Comparison with Key issues WBCSD UNEP/SETAC Social metrics for chemical products PRé Sustainability Guidelines for Social Life Cycle Assessment Handbook for Product Social Impact Assessment of Products Stakeholders 3 stakeholder categories: workers, local 3 stakeholder categories: workers, local 5 stakeholder categories: workers, local communities and consumers communities and consumers community, society, consumers and value chain actors

Social areas 5 social areas grouping the 23 most 6 impact categories (human rights, working relevant impact categories for the chemical conditions, health and safety, cultural heritage, sector governance, socio-economic repercussion) considered as logical groupings of S-LCA results, related to social issues of interest to stakeholders and decision-makers

Social topics 25 social topics corresponding to the most 19 Social topics corresponding to social areas 31 sub categories representing impacts within representative positive or negative social related to stakeholder groups that should be an impact category (working conditions of the aspects for each stakeholder group measured and assessed stakeholder’s workers, for instance)

Mandatory vs optional 11 mandatory impact categories identified Compact assessment (e.g 5 material social topics) impact categories as material for the chemical sector for internal communication vs broad assessment (19 social topics) for external communication

Indicators At least one indicator for each impact Performance indicators Inventory indicators (qualitative and quantitative) category and one or more possible Quantitative and qualitative markers of performance Inventory indicators provide the most direct advanced indicator(s) for each of the social topics, e.g. number of evidence of the condition or result they are Indicators combine the checking of working hours during weekends, minimum salary measuring. They are specific definitions of processes in place and the assessment of paid, etc. They are used for the systematic the data sought. Inventory indicators have their impact. monitoring of progress on improving or achieving characteristics such as type (e.g. qualitative or Advanced indicators are generally more social topics. quantitative) and unit of measurement. quantitative and based on a specific aspect of the impact category; they are considered optional for the assessment.

Reference scale Scale used for measuring process and Scale-based approach or quantitative approach outcome & impact indicators that assesses each process or input linked to the functional unit of the product application from -2 to +2 Reference value NO YES NO Impact assessment method YES YES YES

Functional unit YES NO YES Life cycle stage selection Assessment of all life cycle stages by a NO Hotspot assessment: a methodological practitioner who must answer a list of framework that allows for the rapid assimilation specific question and can use a risk filter and analysis of a range of information sources, analysis to select the most relevant stages including life cycle based studies, market to be integrated in the assessment and scientific research, expert opinion and stakeholder concerns. Allocation NO Only for quantitative KPIs YES (for co-products) Aggregation Aggregation along the value chain and Aggregation along the value chain, followed by The subcategory indicator results are aggregated across social topics, but no general aggregation of social topics scores into stakeholder into impact category results aggregation (stakeholder results can not be group scores and total score. summed up) Weighting No specific recommendation YES YES Social Life Cycle Metrics for Chemical Products | 87

Comparison of WBCSD guidance social topics with PRé Sustainability’s Handbook for Product Social Impact Assessment:

WBCSD Handbook for Product Social Impact Assessment Social Metrics for Chemical Products Justification of differences with the Handbook provided by the subgroup Corresponding social Stakeholders Social topics Definition Ref. Scale/indicators members topic Worker’s occupational health Health and safety Similar No adv. indicator in WBCSD Chemical-sector specific version => no possible comparison

Management of workers’ individual N/A N/A N/A Chemical-sector specific health Safety management system for workers N/A N/A N/A Chemical-sector specific Fair wages Wages Same Similar to the 1st advanced Tighten indicator indicator (difference for +1 with a limit of 5% for the WBCSD) Appropriate working hours Working hours Same Different from indicator and Tighten indicator advanced indicator’s scale criteria

Freedom of association, collective Freedom of association Same Different from indicator’s scaleTighten indicator bargaining and labor relations and collective bargaining criteria Workers No child labor Child labor Similar but not exactly Different from indicator and Tighten indicator the same advanced indicator’s scale criteria

No forced labor, human trafficking and Forced labor Similar but not exactly Different from indicator and Tighten indicator slavery the same advanced indicator’s scale criteria

No discrimination Discrimination Same Different but close to process Chemical-sector specific indicator’s scale criteria Social/employer security and benefits N/A N/A N/A Chemical-sector specific Job satisfaction Job satisfaction and Similar but not exactly Different from indicator and Turnover (used as an indicator by PRé engagement the same advanced indicator’s scale Sustainability) is not considered to be a criteria relevant indicator

Skills, knowledge and employability Training and education Different Different but close to Tighten indicator advanced indicator’s scale criteria Management of reorganization N/A N/A N/A Missing in previous methodologies Health and safety of local community’s Health and safety Similar but more precise Very similar to process indica- Chemical-sector specific living conditions in Handbook tor’s scale criteria Access to basic needs for the human Access to tangible Same meaning but No possible comparison Wider scope for basic needs and focus on right to dignity (healthcare, clean water resources different wording material resources (cultural heritage is not & sanitation, healthy food, shelter) considered)

Access to basic needs for sustainable development (infrastructure, ICT, modern energy) Respect for indigenous rights N/A N/A N/A Chemical sector specific Local communities Developing relationship with local Community engagement Different Different from indicator and One single impact category in order to better communities advanced indicator’s scale reflect that those types of engagements are criteria generally gathered in same program

Nuisance reduction N/A N/A N/A Chemical-sector specific Promotion of skills and knowledge Local capacity building Same as “Local Same Capacity Building”, with additions from ILO and UN documents

Job creation Employment Same Same Consumers Impact on consumer health and safety Health and safety Same Very similar to process indica- Chemical-sector specific tor’s scale criteria Direct impact on basic needs N/A N/A N/A Chemical-sector specific Consumer’s product experience Experienced well-being Same meaning but Different than process To avoid surveys that can be unrealistic in different wording indicator’s scale criteria the frame of an S-LCA. Promotion of skills & knowledge N/A N/A N/A Chemical-sector specific 88 | Social Life Cycle Metrics for Chemical Products

Appendix 8. PVC pipes case study This case study aims at illustrating the different steps 2. Scope of the methodology described in the guidance and is Assuming that we want to assess the social impacts based on companies’ public information. and value of using PVC pipes for water delivery in 1. Context Europe, the goal and functional unit could be the following: • Product assessed: PVC pipes for water delivering system in Europe • Goal of the assessment: social assessment of water delivering system in Europe, using PVC • Actor at the origin of the assessment: European pipes; producer of PVC pipes. making drinking water available • Value chain information: • Functional unit: for 10 000 inhabitants over a 50-year period; o Oil used originates from North sea (40%) and 500 000 gal/year or similar. Venezuela (60%); • Reference flow: o Naphta is refined in Europe; o PVC production is manufactured in Europe; 3. Methodological choices Selection of additional social topics: o Pipes are manufactured in Spain;

o Pipes are finally installed in France; o End of life is recycling by 30%, landfilling by 40%, incineration by 30%.

Justification table for the selection of additional social topics for the PVC case:

14 NON-MANDATORY SOCIAL TOPICS CASE N°1 PRODUCTION OF PVC PIPES FOR WATER DELIVERY IN EUROPE CASE (ENERGY COMING FROM RUSSIA) Management of worker’s individual health Appropriate working hours No discrimination Workers Social/employer security and benefits Job satisfaction Management of worker’s individual health

Local communities Access to basic needs for sustainable development (infrastructure, ICT, modern energy) Respect for indigenous rights Nuisance reduction Developing relationship with local communities Material because local communities invest money for PVC pipe installation, so they have strong expectations Promotion of skills & knowledge

Consumers Consumer’s product experience Direct impact on basic needs Material for the PVC because of the societal function of the product which is to deliver water for the population Promotion of skills & knowledge

2 additional social topics to be added to the assessment Social Life Cycle Metrics for Chemical Products | 89

The final list of social topics included in the assessment is:

SOCIAL STAKEHOLDER GROUP 13 MANDATORY AND ADDITIONAL SOCIAL TOPICS AREA Local communities Acess to basic needs for human right dignity (healthcare, clean water & sanitation, healthy food, shelter)

Consumers Direct impact on baisc needs (healthcare, clean water, healthy food, shelter, education)

Basic rights Fair wages and needs No child labour Workers Freedom of association, collective bargaining and labor relations

No forced labour, human trafficking and slavery

Local communities Health and safety of local communities living conditions

Health and Consumers Impact on consumers health and safety safety Safety managment system for workers Workers Workers’ occupation health risks

Employment Local communities Job creation

Skills and Workers Skills, knowledge and employability knowledge Well-being Local communities Developing relationship with local communities

Boundaries setting: The PVC pipes manufacturing life cycles stages are the following: 90 | Social Life Cycle Metrics for Chemical Products

The selection of Key Life Cycle Stages is based on the following justifications:

UPSTREAM CHEMICAL COMPANY’S OWN OPERATION Life cycle stages Oil extraction Refining of NaCl Additives (colorants, Ethylene, chlorine, VC, naphtha manufacturing pigments, PVC production anti-oxidants) manufacturing Details on the life cycle stage location North Sea (40%) and Europe Europe Europe Venezuela (60%) Key questions Is there evidence of social violations and No No No No situations of risk at this stage in the value chain? Are there specific benefits during this life No No No No cycle stage? Is this life cycle stage relevant to the Yes Yes No (not No (up to 5% in functional unit and to the goal of the significant in mass maximum) study (in term of mass, business term of mass) Automatically included importance, etc.) in the assessment as it concerns the Does this life cycle stage occur in a Yes, Venezuela No No Europe, highly company’s own country with known international human regulated operations rights violations or social risks? Are there specific risks resulting from the Multinational Multinational Multinational No company’s structure & organization? companies companies companies Are there specific hazards due to the ac- Yes, subcontractors No No No tivity considering the impact categories? in the oil sector, with higher exposure to labor issues Conclusion Key life cycle stage Key life cycle Not included in Not included in the Key life cycle stage stage the assessment assessment Social Life Cycle Metrics for Chemical Products | 91

DOWNSTREAM Use phase End of life Life cycle stages Pipe Concrete Pipe installation Steel Electricity Maintenance PVC pipe manufacturing production production of pumps waste for pumps management Details on the life cycle Spain Europe France stage location Key questions Is there evidence of social No No No No violations and situations of risk at this stage in the value chain? Are there specific benefits No No No No during this life cycle stage? Is this life cycle stage relevant Yes No (not Yes Yes to the functional unit and to essential the goal of the study (in term considering of mass, business importance, the functional etc.) unit) Is it produced in a country with No No No No known international human rights violations or social risks Excluded from the pointed out by media? assesment as it is Are there specific risks resulting Large number No Large number not in the system No from the company’s structure & of companies, of companies, organization? compliance compliance management is management is difficult difficult Are there specific hazards due Yes, with high No Use of solvents When to the activity considering the energy demand to connect incinerated, impact categories? and potential pipes (risk in could have social hazard term of health impact on & safety) health due to air emissions coming from the use of additives Conclusion Key life cycle Not included Key life cycle Not included Not included Not included Key life cycle stage in the stage in the in the in the stage assessment assessment assessment assessment

4. Results and Interpretation • When the result for one step (of several) indicators was unknown (e.g. a, c, d, e achieved, but b Details on the methodology followed to assess the unknown) or scoring criteria were not reported PVC case: by companies the way they are needed, expert • The work has been split between 7 group guess have been achieved, reducing the data members who worked on 2 social topics each. quality accordingly. The assessment required around ½ day of work • The scales (or some elements of the scales) per social topic ; appeared to be irrelevant or not applicable to • The assessment was done mainly on the basis some steps of the value chain. When it was the of key actors identified for each step of the value case, no score was given and the mention “not chain ; applicable” was indicated. • The assessment was done only on the basis of publicly available information (CSR Reports, Annual Reports, (Supplier) Code of Conduct, etc.). Companies were not directly contacted. 92 | Social Life Cycle Metrics for Chemical Products

• Detailed results: 2 3.9 2.6 2.3 2.5 2.5 3.1 4.0 1.8 1.8 3.7 2.2 2.2 DATA QUALITY value chain 1.0 1.5 0.6 0.4 1.4 0.0 0.7 0.0 1.2 1.2 1.7 1.2 1.8 PERF. Aggregation along the Aggregation 1 5 1 2 1 2 1 2 0 4 0 4 2 2 1 2 5 1 2 2 2 1 -1 0.8 2.8 France Unknown End of life End of life End of life management not applicable not applicable PVC pipes waste 2 1 3 1 2 1 2 2 2 0 4 0 4 0 0.7 2.7 Clients France Use phase Use phase not applicable not applicable not applicable not applicable not applicable not applicable not applicable not applicable not applicable not applicable not applicable not applicable maintenance only) Use phase (product Use phase (product 5 2 2 1 2 2 3 0 4 2 2 1 2 5 1 2 2 2 1 1 1 1 -1 1.0 2.7 France Unknown Installation not applicable not applicable Pipe installation Downstream Downstream 0 2 4 2 3 2 2 2 2 4 0 4 0 2 2 2 5 1 2 1 2 3 -1 -1 -1 0.6 2.8 Spain Unknown Customers Pipes manufacturing 2 2 4 2 5 1 1 2 2 1 2 2 1 2 0 4 2 1 2 1 2 2 1 2 2 2 1.6 2.2 Europe Own sites VC and PVC Manufacturing Own operations Own operations Chlorine, Ethylene, 2 3 5 2 2 2 2 3 0 4 1 1 2 2 1 2 2 2 2 1 1 2 1 2 2 1 1.5 2.4 Tier 1 Europe 1 (≤1,5) 5 (>4,5) 2 (>1,5 ; ≤2,5) 3 (>2,5 ; ≤3,5) 4 (>3,5 ; ≤4,5) Refining of naphta Data quality: Upstream Upstream

4 1 5 3 3 0 3 2 0 4 3 3 1 3 2 3 2 3 2 0 -1 -1 -1 -1 -1 -1 0.0 3.1 (≥1,5) Tier 2 2 -2 (<1,5) Oil extraction 1 (≥0,5 ; <1,5) 0 (≥-0,5 ; <0,5) North SEA (40%) Venezuela (60%) Venezuela -1 (≥-1,5 ; <-0,5) Performance: Key lifecycle stages of information Source Operating country Result Data quality Result Data quality Result Data quality Result Data quality Result Result Data quality Result Data quality Result Data quality Result Data quality Result Data quality Result Data quality Result Data quality Result Data quality Performance Data quality Data quality - risks relations and safety education) Fair wages for workers Job creation employability No child labour local communities 13 mandatory and healthy food, shelter) Skills, knowledge and trafficking and slavery Direct impact on basic Direct Freedom of association, Freedom needs (healthcare, clean needs (healthcare, No forced labour, human labour, No forced Health and safety of local Access to basic needs for additionnal social topics water, healthy food, shelter, healthy food, shelter, water, human right dignity (health Safety management system Developing relationship with Developing relationship Step-based aggregation Impact on consumers health Workers’ occupational health Workers’ communities living conditions care, clean water & sanitation, care, collective bargaining and labor collective bargaining Local Local Local Local group workers workers workers Consumers Consumers communities communities communities communities Stakeholder needs safety Skills and Well-being Health and knowledge Social area Employment Basic rights and Social Life Cycle Metrics for Chemical Products | 93

• Interpretation of the results: Data quality Step-based aggregation The assessment was done mainly on the basis of public information (CSR Reports, Annual Reports, Among all life-cycle steps studied, oil extraction (Supplier) Code of Conduct, etc.) from key actors is the step with the worst marks, in particular identified for each step of the value chain3. The regarding basic rights and needs, human rights social topics Access to basic needs for human violation, living conditions, workers’ occupational right dignity and job creation record the worst health. Results are negatively impacted by the data quality. Social topics on health and safety of poor situation in Venezuela, where 60% of the workers (implementation of safety management crude oil used to produce PVC pipes comes from. systems, workers’ occupational health) record the Pipe manufacturing, that takes place in Spain, is highest data quality. the steps with the second worst marks, especially regarding basic rights and needs (fair wages, child labour, forced labour), due to the absence • Challenges and Group members’ of annual report and information regarding recommendations for the future: compensation management system or salary 1. It might be helpful if the reporting company, structure. especially in the chemical sector, would Refining of naphta and production of ethylene, use “key words” for the respective social vinyl chlorine and PVC are the two steps with indicators in their reports and place the the best marks. Company producing these necessary information near to these key intermediary products and products are located words. A table with a small collection of key in Europe. They are especially outstanding words relevant to the social indicators could performers regarding access of local communities be added to the guidance document (as an to basic needs for human rights dignity, absence additional guidance for the reporting company of forced labour, human trafficking and slavery, and as a good help for the practitioner job creation and developing relationship with local conducting the assessment). communities. European companies producing 2. Having a tool calculating automatically the ethylene, vinyl chlorine and PVC are also best results would simplify the work. It would in class for providing fair wages to workers and also be helpful to have “Data Quality direct impact to basic needs for consumers. Assessment Matrix” as a tab in the PVC case Value-chain aggregation study template and also in the “Indicators Among all social topics, the PVC pipes record Description” Excel file. the best marks for job creation (however, for three steps the assessment is not available for this social topic due to data availability) and the development of relationship with local communities. The PVC pipes record the worst marks for the impact on consumers’ health and safety and no forced labour, human trafficking and slavery social topics. The PVC pipes did not get an aggregated negative score for any of the social topics studied. So we can conclude that in general, the PVC pipes manufactured in Europe and installed in France have very limited negative impacts on the three stakeholder groups studied (workers, consumers, local communities).

3 Corresponding to a data quality between 2 and 3, on a scale of 5 (1 corresponding to the highest data quality). 94 | Social Life Cycle Metrics for Chemical Products

Appendix 9. Glossary and definitions Aggregation along the value chain: The aggregation Management (SAICM). The overall objective of this of results of all the key life cycle stages (see section policy framework, initiated by the United Nations 6.2) for one indicator. Environment Programme (UNEP), is that by 2020, chemicals are produced and used in ways that The aggregation Aggregation across social topics: minimize significant adverse impacts on human health of all indicators (indicator and advanced indicators), and the environment. For more details, view the ICCA either for a social topic or a social area or a GPS information portal: http://www.icca-chem.org/ stakeholder category or for all stakeholder categories, en/Home/Global-Product-Strategy. grouping all indicators studied. The World Health Organization (WHO) Partitioning the input and/or output flows Health system: Allocation: defines a health system as “all the organizations, of a process to the product system under study. institutions and resources that are devoted to Comparative assertion: Claim regarding the producing health actions”. It includes the full range superiority or equivalence of one product or solution of players engaged in the provision, financing and versus a competitor’s product that performs the management of health services, efforts to influence same function (definition based on ISO 14045:2012 determinants of health as well as providing direct and does not interpret, change or subtract from the health services and encompassing all levels: central, requirements of ISO 14044:2006). regional, district, community and household. Cradle-to-gate assessment: Addresses the Indicator: Quantifiable representation of a social social aspects and potential social impacts (e.g. impact. One indicator has been designed for each impact local communities by depleting resources) of the 25 social topics. It combines the checking throughout, from raw material acquisition to the of processes in place and the assessment of their point at which it leaves the gate of the factory (i.e. impact. Indicators of mandatory and additional social excluding transport to use location, use and end-of- topics are necessarily integrated into the assessment life). of the product. Cradle-to-grave assessment: Addresses the Advanced indicator: At least one advanced indicator environmental aspects and potential environmental has been designed for each of the 25 social topics. impacts (e.g. impact local communities by depleting They are generally more quantitative and based resources) in a product’s life cycle, from raw material on a specific aspect of the social topic. They are acquisition through production, use, end-of-life considered optional for the assessment. treatment, recycling and final disposal (adapted from: Indigenous peoples ISO 14040:2006 and 14044:2006). Indigenous rights (supplement): are entitled to determine their political status, Comparative chemical product social-metrics pursue economic, social and cultural development, study: Chemical product social-metrics study dispose of their land’s natural resources and not including comparative assertions about chemical be deprived of their own means of subsistence. products. Indigenous people always need to give their free and prior informed consent to dispose of their land Consumers: The end-users of the final products (in a personal or professional context). with adequate compensation. It extends to the right to preserve, protect and develop indigenous and Functional unit: “Quantified performance of a product traditional knowledge systems. system for use as a reference unit” (source: ISO 14040:2006 and 14044:2006). Key actors/key life cycle stages: A risk filter analysis of boundary setting. Methodology defined section Global Product Strategy (GPS): The International 5.6. Council of Chemical Associations (ICCA) launched the Global Product Strategy (GPS) in 2006 to advance Life cycle: Consecutive and interlinked stages of the product stewardship performance of individual a product system, from raw material acquisition or companies and the global chemical industry as a generation from natural resources to final disposal whole. Together with the Responsible Care Global (ISO 14044:2006). Charter, GPS is the chemical industry’s contribution to the Strategic Approach to International Chemicals Social Life Cycle Metrics for Chemical Products | 95

Life cycle assessment (LCA): Compilation and Proven performance: Several indicators (presented evaluation of the inputs, outputs and the potential in appendix 4) require “proven” performance to reach environmental impacts of a product system specific levels of the performance scale. This term throughout its life cycle (ISO 14044:2006). can be understood as “the company has passed an official test and corresponding documentation is People living in the surroundings Local communities: available”. of any site all along the life cycle of a given product and that are impacted by the site activities. Red flag: Indication accompanying the result of an indicator assessment that informs the reader of The Global Reporting Initiative notes that “the unavailable data. geographic definition of ‘local’ may vary because, in some circumstances, cities, regions within a country, Reference flow:“Amount of product on which the and even small countries could be reasonably viewed results of the study are based” (source: WRI/WBCSD, as ‘local’.” The definition of “local” will depend 2011) on the purposes of measurement. For instance, A fact forming the basis of an if the company is trying to measure local impact Reference point: evaluation or an assessment. for government authorities, the definition may use the jurisdictional boundaries of the authority in Reference scale: Scale used to measure indicators question. If the purpose is to compare the impact of and that assesses each process linked to the different units within the company, the definition may functional unit of the product application. All scales encompass the sales or operations territory of each defined in the report have five levels, from -2 to +2. unit. If the facility is a pipeline or road, the “local” Remedy: Even where institutions operate optimally, area may be defined in terms of a corridor along the adverse human rights impacts may still result from route. It is important to consider the way stakeholders a company’s activities and victims must be able to define local. A few key factors to keep in mind when seek redress. Effective grievance mechanisms play an defining the local area: important role in both the state’s duty to protect and • Jurisdictional boundaries of the area; the corporate responsibility to respect. • Scale and reach of business operation and As part of their duty to protect against business- influence; related human rights abuse, states must take appropriate steps within their territory and/or • General relationship and dependency of the jurisdiction to ensure that when such abuses occur, communities or districts. those affected have access to effective remedy (Source: WBCSD, IFC, 2008) through judicial, administrative, legislative or other appropriate means. Currently, access to judicial Grouping of the 11 mandatory Material social topic: mechanisms for business-related human rights claims social topics and the additional non-mandatory social is often most difficult where the need is greatest as topics that are considered as particularly relevant for a result of both legal and practical obstacles. And the product application studied. there is currently an uneven patchwork of non-judicial Non-comparative chemical product social-metrics mechanisms, including mechanisms at the company study: Chemical product social-metrics study of one level, national level (such as national human rights or more chemical products without any comparative institutions, or national contact points in states that assertion. have signed the OECD Guidelines on Multinational Enterprises) and at the international level (such as the Plan Do Check Act (PDCA) process: Iterative four- step management method used in business for the Compliance Advisor Ombudsman for the International control and continuous improvement of processes Finance Corporation). and products. Primary data: Data from specific operations in the studied product’s life cycle that is measured. 96 | Social Life Cycle Metrics for Chemical Products

Non-judicial mechanisms, whether state-based Secondary data: Process data that are not from or independent, should conform to principles specific processes in the studied product’s life cycle. of legitimacy, accessibility, predictability, rights- Assessment of the potential positive compatibility, equitability and transparency. Company- Social impact: or negative social performance of the product and level mechanisms should also operate through some of its immediate effects on various stakeholders dialogue and engagement rather than the company along its life cycle (workers, local communities, itself acting as adjudicator of its own actions. To consumers). support improved access to information, learning and expertise in pursuit of more effective non-judicial Triangulation: A technique that facilitates the grievance mechanisms, the Special Representative validation of data through cross verification from established an online resource to assist parties in two or more sources. In particular, it refers to the navigating their available options—Business and application and combination of several research Society Exploring Solutions. methods in the study of the same phenomenon. (Source: “Protect, Respect and Remedy” Framework Weighting: Assigning weights or relative values to for Business and Human Rights, UN, 2008) the different social topics based on their perceived importance or relevance in order to emphasize the Social topics identified in the present Social topic: most important potential impacts. study correspond to the most representative positive or negative social impacts for each stakeholder Workers: People who perform work related to the group that may occur at various stages of the life product value chain (including those employed by cycle. Within the 25 social topics defined in the study, contractors and subcontractors). This questionnaire 11 have been selected as mandatory due to their applies to all workers involved in the key life cycle particular relevance for the chemical industry. stages of the product (from raw material extraction, manufacturing, use or disposal). Stakeholder groups: Groups of people on which the product has an impact along its life cycle, such as workers, consumers and local communities. Social Life Cycle Metrics for Chemical Products | 97

Appendix 10. Acronyms BSCI Business Social Compliance Initiative CEFIC European Chemical Industry Council CSR corporate social responsibility GHG greenhouse gas GPS Global Product Strategy launched by the International Council of Chemical Associations GRI Global Reporting Initiative HIVO Humanist Institute for Cooperation (Humanistisch Instituut voor Ontwikkelingssamenwerking HR human resources ICCA International Council of Chemical Associations IFC International Finance Corporation ILO International Labour Organization I-O-O-I input/output outcome/impact level (method) IOPS International Organisation of Pension Supervisors ISO International Organization for Standardization; 14040:2006 gives LCA principles and framework; ISO 14044:2006 gives LCA requirements and guidelines; and ISO 14045:2012 gives eco-efficiency assessment of product systems principles, requirements and guidelines

ISSA International Social Security Association LCA life cycle assessment LCI life cycle inventory NGO non-governmental organization OECD Organisation for Economic Co-operation and Development PDCA Plan Do Check Act PE polyethylene PEF Product environmental footprint RFP WBCSD’s Reaching Full Potential Chemical Sector Project SA Social Accountability International SAICM Strategic Approach to International Chemicals Management SETAC Society for Environmental Toxicology and Chemistry S-LCA social life cycle assessment SSA U.S. Social Security Administration UNEP United Nations Environment Programme UNEP-DTIE United Nations Environment Programme Division of Technology, Industry and Economics WBCSD World Business Council for Sustainable Development WHO World Health Organization WRI World Resources Institute Disclaimer About the World Business Together, we are the leading voice of business for sustainability: This publication is released Council for Sustainable united by our vision of a world in the name of the World Development (WBCSD) where more than 9 billion people Business Council for Sustainable WBCSD is a global, CEO- are all living well and within the Development (WBCSD). This led organization of over 200 boundaries of our planet, by 2050. document is the result of a leading businesses and partners collaborative effort among working together to accelerate companies of the Reaching Full the transition to a sustainable www.wbcsd.org Potential (RFP) chemical sector world. We help make our member project, and was supported by companies more successful and Follow us on Twitter and LinkedIn PwC. sustainable by focusing on the maximum positive impact for Reaching Full Potential companies shareholders, the environment and from the Metric work stream societies. collaborated to develop and review the material, thereby ensuring that Our member companies come the document broadly represents from all business sectors and all the majority view of the group. major economies, representing

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