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As a food retailer with a complex supply chain we conduct annual supply chain risk assessments to help us to scope and prioritise our due diligence activities and HRIAs. This includes assessing quantitative risk factors and qualitative insights gathered from stakeholder engagement, alongside Lidl’s purchasing volumes, to identify key commodity supply chains.
Following this process, we decided to conduct our first HRIAs in the Kenyan tea supply chain, the Spanish berry supply chain and the South American banana supply chain. These are supply chains with inherent human rights risks where Lidl has leverage due to its sourcing commitments and total volumes.
Our HRIAs follow a systematic process to identify, prioritise and address the impact of business operations on human rights issues within key commodity streams. This includes direct engagement with stakeholders and rights-holders within the scope of the assessment. An important aspect of our approach is the mitigation and remediation plan, which includes time-bound actions to ensure salient human rights risks identified through the process are addressed effectively.
The HRIA methodology for our Kenya tea supply chain included desk-based baseline analysis, an in-country field visit with support from a local partner, an impact assessment using a numerical scoring system and an action plan.
The assessment considered the different perspectives of people that are affected by Lidl’s business activities, including potentially impacted rights-holders, and also engaged with key stakeholders along the supply chain. These included Kenyan smallholder farmers, tea estate workers, our direct suppliers and key Lidl staff, including commercial teams and buyers.
In addition to this, the process also engaged stakeholders beyond Lidl’s immediate supply chain, including trade unions, civil society organisations, Multi Stakeholder Initiatives (MSIs) and NGOs, allowing us to directly access rights-holders and improve our understanding of gender, small-holder producer organisations and the structure of the tea producing economy in Kenya for the European market.
Stakeholders engaged during field visit:
Through the process we gained a clearer understanding of the impact of our business activities within the Kenyan tea supply chain, including both our direct and indirect impacts. We also gained a better understanding of our leverage, role and responsibility in effectively mitigating the impacts identified. The HRIA identified further information about the systemic issues facing women and smallholder tea producers, including land rights, worker representation and gender discrimination.
Through stakeholder engagement we have developed relationships with partners to enable direct access to rights-holders as well as understanding impacts first-hand. We will continue to develop these partnerships to support our action plans and on-going monitoring, recognising that an HRIA is an ongoing process, as opposed to a one-off assessment.
This table summarises some of the most salient positive and negative impacts identified through our desk-based research and field work analysis.
| Right(s) Impacted | Activities in Supply Chain | Rightsholder(s) | Impact Type | Summary of Impact(s) |
| Right to adequate standard of living (livelihoods, housing, food, water) | Smallholder co-operatives | Smallholder farmers | Negative | Tea price volatility coupled with variable costs of production can lead to the constraints on basic facets of life such as access to water, labour, education/school fees, health. |
| Estate operations | Workers, estate residents | Negative | Low wages and a move towards increased mechanisation on tea estates impact workers and estate residents’ ability to access an adequate standard of living. | |
| Working conditions | Estate operations | Field workers | Negative | Casual labour is a common labour arrangement and payment is normally according to piece rate, leading to long working hours. |
| Right to health | Social investment and social responsibility activities by producer organisations | Tea growing communities | Positive | Some estate health facilities have extended healthcare provision to non-workers in tea growing areas. |
| Discrimination (gender, access to land and financial resources) | Tea producer CSR activities and investments | Women | Positive | Financial literacy and business skills training provided through experts, supported by tea companies. |
| Smallholder co-operatives | Smallholder farmers | Negative | Entrenched cultural barriers to women’s land ownership in Kenya, meaning women can work or even run farms, but frequently enjoy no direct representation within the producer group because they are not the landowners. | |
| Right to civic participation | Smallholder co-operatives | Smallholder farmers | Positive | Tea companies support tea growing communities through organisation and political representation & advocacy related to policy decisions affecting the sector. |
Alongside the specific time-bound actions outlined below, we intend to consult further with stakeholders and partners on the findings and leverage support to develop our full mitigation plan.
We are committed to publishing the full assessment report by the end of 2020, as well as publishing progress through our CSR reports. We will use key findings and learnings from this assessment to inform HRIAs in other countries, commodities and contexts and will also refine our methodology for future HRIAs.
Action | Timeline |
Continue to engage with stakeholders, local partners and MSIs included within the HRIA to feedback learnings, continue dialogue and test interventions | Ongoing |
Develop buying policies to go beyond certification requirements, including specific interventions to mitigate risks associated with smallholder farmers and women | By Q3, 2020 |
Identify opportunities to mitigate impact of price volatility on rights holders through business practices | By Q3, 2020 |
Identify relevant MSIs to engage with on sector-wide approaches and specific issues | By April, 2021 |
Continue engagement with third party certification schemes to share findings and explore opportunities to increase positive impact of schemes | Ongoing |
Evaluate pilot HRIA process and incorporate key learnings into future assessments conducted within the Lidl Group | By Q3, 2020 |
