Human Rights Due Diligence
RESOLVED: Shareholders request the Board of Directors prepare a report, at reasonable cost and omitting proprietary information, on Sanderson Farm’s human rights due diligence (“HRDD”) process to assess, identify, prevent and mitigate actual and potential adverse human rights impacts.
Supporting Statement: We recommend the report:
• Include the human rights principles used to frame its risk assessments;
• Outline the human rights impacts of Sanderson Farm’s business activities, including company-owned operations, contract growers, and supply chain, and plans to mitigate any adverse impacts;
• Explain the types and extent of stakeholder consultation; and
• Address Sanderson Farm’s plans to track effectiveness of measures to assess, prevent, mitigate, and remedy adverse human rights impacts.
Companies that fail to address human rights concerns risk backlash from communities, customers, and regulators, all of which pose significant harm to long-term shareholder value. Industrial meat production exposes workers, farmers, and communities to actual and potential adverse human rights impacts. Poultry processing workers, including Sanderson’s, have routinely faced serious labor rights violations, including injuries from unsafe line speeds and other hazards, exposure to toxins, wage and hour violations, sexual harassment, and workplace discrimination.1 In addition to the risks faced by workers, surrounding communities are also impacted by processing plants’ interference with their right to clean water.2
The current COVID-19 pandemic has aggravated these dangers,3 with the poultry industry being a hotspot of infections in multiple states.4 Workers at Sanderson and other companies have complained about insufficient response from the company to increase protections, and highlighted instances of plants that are not following the practices the company purports to adopt.5 Workers reported that Sanderson failed to institute social distancing policies, leaving them to “work elbow to elbow on the production line,” and did not make masks available.6
Increased public scrutiny on these harmful production practices generates financial risk. The poultry processing industry is plagued by legal complaints, fines, and journalist investigations7 revealing patterns of workplace violations. Sanderson Farms is not immune: allegations against the company and its subsidiaries range from denied disability accommodation8 to federal fines issued for violations of wage and hour regulations,9 workplace safety and health, and labor relations regulations.10 Though Sanderson Farms’ Corporate Sustainability Statement affirms the n company’s responsibilities to constituents other than shareholders,11 the repeated occurrence of investigations, fines, and lawsuits indicates that meaningful steps need be taken to ensure that the company upholds these values in regards to its workers and the communities where the company operates.
The UN Guiding Principles on Business and Human Rights12 affirm that corporations have a responsibility to respect human rights within company-owned operations and throughout their supply chain. To meet this responsibility, companies are expected to conduct HRDD, informed by the core international human rights instruments, to assess, identify, prevent, and mitigate adverse human rights impacts.13 To protect its long-term financial interest, Sanderson Farms should do just that.
6 Ibid.7 https://www.theguardian.com/food/2018/nov/26/revealed-restricting-breaks-keeps-poultry-industry-workers-living-in-fear
13 https://www.ohchr.org/en/professionalinterest/pages/coreinstruments.aspx; https://www.ilo.org/declaration/lang--en/index.htm; http://www.oecd.org/investment/mne/1922428.pdf