One word sums up the outlook for business and human rights in 2025 – uncertainty. However, to say that the social, economic and environmental outlook is uncertain is an understatement. Alarming may be a better descriptor.

Forced labour, trafficking, child labour, living incomes and wages, discrimination, ppm, deforestation, drought and extreme heat all complicate the age-old challenge of making a living. Employers and employees alike, and their families and communities, are facing risks at a scale many have never seen and may not be prepared for.

So how will companies navigate the increasingly risky world of global investment and trade? Navigation implies that you can see where you are going, and many companies lack the visibility needed to prevent or avoid risks. Mapping the value chain is a crucial first step, to be followed by a risk mapping exercise – attaching a risk to each location and actor in the value chain – and then working with business partners, suppliers and stakeholders to prevent, mitigate or remediate it.

Those business risks are not unrelated. They interact and reinforce each other. Poverty, inequality and exclusion underpin child labour and reinforce discrimination, undermine living incomes and wages, provoke conflict and drive people to seek better work and futures elsewhere. Those socio-economic migrants are joined by environmental refugees and people fleeing armed conflict. Unable to access regular migration channels, they fall into the clutches of traffickers and often end up as modern slaves working undocumented and precarious jobs in foreign countries.

Climate change exacerbates food, shelter and income insecurity, sharpens socio-economic conflict and drives internal and international displacement of people. These interconnected risks are increasing in intensity and frequency. The EU’s Joint Research Centre reports that “the pace at which the world’s population has become exposed to natural hazards, climate change, conflict, shocks – such as Covid-19 – and socioeconomic challenges increased between 2015 and 2024”, resulting in “the average risk – and the average vulnerability – nearly doubling over the past 10 years”.

Ten of the 15 riskiest countries in the world are in Africa and the continent has the highest average rate of risk in the world, while the Americas saw the greatest increase in risk over the last ten years. These crises don’t just happen to us however – we cause them. Human factors are responsible for over 70% of the crises, and the impacts are socially patterned, with poorest countries and communities suffering the most.

The World Inequality Database reports that while global average per capita income has increased, there are big differences in wealth between and within countries. In 2023 the difference in average incomes between Sub-Saharan Africa and North America was 1 to 15. Average incomes may also mask highly unequal shares in national income. In South Africa the richest 10% capture 65% of national income, and the USA is the most unequal country in the OECD.

Displacement and migration are at record highs due to conflict, disasters, unemployment and violence. Launching the 2024 World Migration Report IOM Director General Amy Pope said, “In a world grappling with uncertainty, understanding migration dynamics is essential for informed decision-making and effective policy responses…”, underscoring the urgent need for data to manage this risk.

The inescapable conclusion is that the world in 2025 is a dangerous place, so what can we do about it? The first question to ask is “what’s the government doing to protect citizens”? Well, it’s complicated. Freedom House reported that global freedom declined for the 18th consecutive year in 2023, with reduced political rights and civil liberties in 52 countries, and improvements in only 21.

ACLED (Armed Conflict Location & Event Data) reports that global conflicts have doubled in the last five years, including inter-state, jihadi, gang, political and communal violence. These “unprecedentedly high” rates of conflict are expected to increase 15% in 2025. ACLED note the important distinction between being in power and being in control – an increasing number of governments are unable to control their borders and/or their entire territory, ceding control to gangs or war lords.

With only limited or counterproductive government action to protect social, economic and environmental standards all actors in global value chains are left exposed to risks and inevitable crises. International cooperation is also hamstrung. Intergovernmental organisations are only as strong as their members, and with the shift to a multipolar world its harder to achieve the necessary degree of consensus and commitment on the vital issues. Even when decisions are reached, many member states fail to implement them.

The fact that government agencies are failing in their duty to protect human rights and environmental standards means that the responsibility to act falls on us, the private sector writ large. Companies, civil society organisations and consumers. We must all assume our shared responsibility to current and future generations by developing policies, strategies and tools to guide us through the poly-crises we face.

The list of risks (and full-blown crises) is likely to be long, so companies need a tool to enable them to prioritise the risks according to likelihood, severity and responsibility. This materiality matrix will enable companies to exercise their fiduciary duty to assess all manner of risks and to take appropriate action.

Every risk has its stakeholders, both internal and external, and companies should see them as essential sources of information, insight and networks that could strengthen efforts to prevent, mitigate or avoid the threat. A stakeholder matrix should be constructed and maintained alongside the materiality matrix.

Company governance structures should receive updated and adjusted materiality and stakeholder matrixes regularly so that they can take timely action to ensure the continuity of their business activities.

For most companies making, delivering and selling their products involves an intimidating number of moving parts. Collecting information on the risks associated with their business activity is a challenge that demands the right tools. At Equiception Business and Human Rights we’ve developed tracing and risk mapping tools that can be used on- or offline, with a database for storing the information in a logical and searchable format. The materiality and stakeholder matrixes, risk and performance surveys and reporting functions can be deployed separately or in a combined fashion depending on the user’s needs. They’re scalable and affordable (thanks to digitalisation) and enable companies to know which risks are embedded in their resource flows and what can be done to manage them.

The tools have also been designed for use by MSME’s since they are the entities that have to do the doing when it comes to implementing human rights and environmental standards. Helping them tool-up for an uncertain world is a major priority for us because if the MSME’s can’t manage the risks, society and the environment suffer the inevitable consequences. For us it’s all about getting the right tools in the hands of the people on the frontlines of social and environmental sustainability.

Happy to discuss further. Contact us at duediligence@equiception.net