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Operational levelgrievancemechanismsIPIECA Good Practice Survey

SocialResponsibility2012

www.ipieca.org

The global oil and gas industry association for environmental and social issues

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Operational levelgrievancemechanismsIPIECA Good Practice Survey

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OPERATIONAL LEVEL GRIEVANCE MECHANISMS

Contents

Purpose and scope 1

Introduction 2

Section 1: Understanding grievance mechanisms 5

The business case 6

Grievance mechanisms and stakeholder engagement 7

Effectiveness criteria 7

Basic process steps 10

1. Receive 11

2. Assess and assign 11

3. Acknowledge 11

4. Investigate 11

5. Respond 12

6. Consider recourse or appeal 12

7. Follow up and close out 13

Potential elements of good practice 13

Section 2: Design and implementation 15

Design and implementation 16

Step 1: Form design team and engage stakeholders 16

Step 2: Assess risk 16

Step 3: Design and implement 17

Step 4: Review and improve 18

Strategies for enhancing trust 19

Joint fact finding and decision making 19

Use of third parties 20

Use of multi-stakeholder bodies 20

Section 3: Management framework 21

Management framework 22

Policy or standard 22

Standard operating procedure 22

People 23

Training 23

Systems, tools and resources 23

Assurance 24

Culture and commitment 24

Appendix: Resources and further reading 25

Acknowledgements 26

Wherever companies do business, engaging with affected communities and responding to their concerns isessential to operating successfully whilst ensuring respect for human rights. Processes that allow concerns tobe raised and remedied—also known as grievance mechanisms—are an important means of achieving thisaim. Grievance mechanisms benefit companies and communities by providing an opportunity for concernsto be identified and resolved before they escalate. When implemented as part of a broader communityengagement strategy, they contribute to enhanced relationships, reduced risk, better management ofoperational impacts and the avoidance of potential harm.

This IPIECA Good Practice Survey on Operational Level Grievance Mechanisms builds on a decade ofactive engagement by IPIECA on business and human rights. IPIECA was among the first industry bodies toincorporate human rights into our social responsibility work in the early 2000s, later establishing adedicated task force to advance best practice. Member companies actively supported the mandate of theUN Special Representative on Business and Human Rights. Most recently, following the adoption of the UNGuiding Principles on Business and Human Rights, IPIECA launched a three-year initiative to advanceimplementation of two key pillars of the framework: human rights due diligence and grievance mechanisms.In each of these areas, IPIECA is developing guidance tailored to the unique needs of the oil and gasindustry through a combination of field testing, collaborative learning and consultation with a range ofexternal stakeholders and experts.

This Good Practice Survey is designed to summarize the growing body of literature on communitygrievance mechanisms. It extracts the key insights from an array of publications and draws them together ina single, easy-to-use document focused on the needs of industry practitioners.

As the guidance surveyed in this document is yet to be tested systematically within the oil and gas industry,IPIECA has initiated a series of pilot implementation projects sponsored by member companies to field-testapproaches to grievance mechanisms in different operating contexts. The pilots will test the basic preceptsof this survey, with an emphasis on promoting local solutions to local challenges. During this process,participating companies will take part in a collaborative learning process designed to share knowledge andunderstanding about how to make grievance mechanisms work in practice. The results of this experiencewill inform the IPIECA Guide to Grievance Mechanisms in the Oil and Gas Industry, to be published at theconclusion of the project.

IPIECA will share the results of these activities and continue to engage with a wide range of stakeholders asthis process moves forward.

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Purpose and scope

This document surveys the existing body of third-party guidance on operational level grievancemechanisms. It focuses on aspects of the literatureof most relevance to the oil and gas industry,including the criteria for effective grievancehandling, basic procedural steps, elements ofgood practice and integration with existingmanagement systems.

Oil and gas activities give rise to varied social andenvironmental impacts. Companies have extensivesystems in place to enhance the positive impacts oftheir activities and minimize the negative ones.They also seek to build strong relationships withaffected communities in order to facilitate their

input into decisions about how impacts areidentified, avoided or managed. These practicesare designed to work together to anticipate andresolve potential issues before they arise. Yet, evenwhen an operation is managed to the higheststandards, concerns about its performance can stillbe expected from time to time.

Grievance mechanisms provide a means by whichaffected individuals or communities can raisequestions or concerns with a company and getthem addressed in a prompt and consistentmanner. They do not replace state-based judicialor non-judicial forms of remedy. But when appliedeffectively they offer the prospect of a more

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Introduction

Even when anoperation ismanaged to thehighest standards,concerns about itsactivities can stillbe expected fromtime to time.

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efficient, immediate and low cost form of disputeresolution for both companies and communities.

As awareness of their value has grown, a numberof sectors have begun to explore how grievancemechanisms can be adapted to their uniquebusiness needs and impacts. The emergence of theUN Guiding Principles on Business and HumanRights, which assign a prominent role to grievancemechanisms under the ‘Protect, Respect andRemedy’ framework, has been another importantcatalyst. As stakeholders increasingly turn theirattention to the practical implementation of theGuiding Principles, the trend towards greateruptake is set to continue.

The growing interest in grievance mechanisms hashelped to inspire a proliferation of recent guidancenotes from various institutions, universities and

associations. Whilst this literature is rich in adviceand insight, it is yet to be tested systematically inthe diverse environments in which the global oiland gas industry operates. Compounding theconfusion for industry practitioners has been thesheer number of documents offering guidance inthis area combined with a lack of detail on thepractical aspects of implementation or integrationwith existing systems.

This Good Practice Survey is designed to helpcompanies navigate the growing body of literatureand advance their individual implementationefforts by pulling together the core insights andconcepts most relevant to the oil and gas industry.Drawing on an array of guidance and research, itextracts and consolidates the latest thinking ongrievance mechanisms into a single, convenientdocument for use by industry practitioners.

Terminology used in this survey

When talking about grievance mechanisms,terminology can be a recurring source ofconfusion for many companies. In some cases,words such as issue, concern, complaint,grievance and feedback may be usedinterchangeably. In other circumstances, theseterms may have quite different meaningsdepending on existing usage within the companyor communities. In certain contexts, terms such asgrievance may have negative connotations andshould be avoided altogether.

There is no right answer about which terms ordefinitions are most suitable. Companies shouldselect the terms that are most appropriate fortheir context and which will be most readilyunderstood by affected communities who mayneed to use the mechanism.

This survey uses the following definitions:

ConcernConcerns are questions, requests for information,or general perceptions unrelated to a specificimpact or incident. If not addressed to thesatisfaction of the complainant, concerns maybecome complaints. Although concerns do not

have to be registered as a formal complaint, theyshould be noted in an appropriate managementsystem so that emerging trends can be identifiedand addressed before they escalate.

Complaint or GrievanceComplaints or grievances are an expression ofdissatisfaction stemming from a real orperceived impact of a company’s businessactivities. Complaints can range from commonlyoccurring, relatively minor problems to moreentrenched or serious ones that have thepotential to become a source of significantresentment. When people present a complaint tothe company, they generally expect to receive aspecific response or remedy.

The terms complaint and grievance are usedinterchangeably in this document, withoutpresuming differences in scale, complexity orseriousness.

Grievance mechanism A grievance mechanism is a process forreceiving, investigating and responding toconcerns or grievances from affected stakeholdersin a timely and consistent manner.

To test the real-world application of the advicesurveyed in this document, IPIECA has launched aseries of pilot projects to test different approachesto implementation on the ground. Sponsored by aselect group of member companies andrepresenting a range of operating environments,each pilot will seek to establish a grievancemechanism or improve one that already exists.Their experience will be followed over a two-yearperiod via a collaborative learning process. Theresulting learning will be incorporated into theIPIECA Guide to Grievance Mechanisms in the Oiland Gas Industry—a next-generation guidancedocument combining the latest thinking withpractical experience on the ground.

This document is divided into three sections:● Section 1 focuses on understanding grievance

mechanisms, and presents the business case,foundational principles, procedural steps andpotential attributes of good practice.

● Section 2 discusses design and implementationand explains the overall process for creating agrievance mechanism.

● Section 3 addresses the managementframework, resources and integration withexisting systems.

The Appendix provides a partial list of referencesconsulted and links to other sources of guidanceand commentary. Given the constant growth in theliterature on grievance mechanisms, readersshould note that this list is not comprehensive.

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Section 1:Understanding grievance mechanisms

Understanding grievance mechanisms• Business case• Grievance mechanisms and stakeholder

engagement• Grievance mechanisms and access to remedy

Section 2:Design and implementation

Section 3:Management framework

Effectiveness criteria• Legitimate• Accessible• Predictable• Equitable

• Transparent• Rights compatible• Continuous learning• Dialogue based

Basic process steps• Step 1: Receive• Step 2: Assess and assign• Step 3: Acknowledge• Step 4: Investigate• Step 5: Respond• Step 6: Recourse or appeal• Step 7: Follow up and close out

Potential elements of good practice• Approaches to translating the effectiveness

criteria into practice

Form design team and engage stakeholders• Form a cross-functional design team• Engage internal and external stakeholders

Assess risk• Assess the nature and frequency of

potential complaints

Design and implement• Design the mechanism• Pilot the mechanism• Full implementation

Review and improve• Analyse grievances received to improve the

mechanism• Incorporate cumulative learning

Strategies for enhancing trust• Joint fact finding and decision making• Use of third parties• Use of multi-stakeholder bodies

Management framework• Integration with existing management systems• Policy or standard• Standard operating procedure• People• Training• Systems, tools and resources• Learning and assurance• Culture and commitment

Figure 1 Survey overview

Section 1:

Understandinggrievancemechanisms

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Grievance mechanisms are processes for systematically receiving,investigating and responding to community complaints at an operationallevel. When carefully designed, properly implemented and embedded in aneffective community engagement programme, they provide significantbenefits to both companies and communities.

A well-functioning grievance mechanism:● demonstrates a company’s willingness to take

community concerns seriously, therebycontributing to better relationships withstakeholders;

● promotes early identification and resolution ofconcerns, leading to better management ofoperational impacts and the avoidance ofpotential harm;

● reduces the potential for complaints to escalateinto litigation, protests, security incidents, orregulatory challenges that could result in projectdelays or production deferments;

● improves alignment with international standardsand external expectations; and

● facilitates a learning culture in which trends andpatterns can be analysed to drive continuousimprovement in performance.

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The business case

Operational-level grievance mechanisms and the UN Guiding Principles on Business and Human Rights

The question of how companies should respond togrievances raised by affected individuals andcommunities was addressed by the mandate ofthe UN Secretary General’s Special Representativeon Business and Human Rights, John Ruggie. Inhis 2008 report, ‘Protect, Respect and Remedy’,Ruggie proposed a framework for business andhuman rights based on three pillars: 1. the state duty to protect against human rights

abuse; 2. the corporate responsibility to respect human

rights; and 3. access to effective remedies for affected

people.

The latter pillar consists of state-based judicialand non-judicial mechanisms, and non-statemechanisms, including operational-level grievancemechanisms offered by companies. This frameworkwas subsequently incorporated into the UNGuiding Principles for Business and Human Rightsadopted by the UN Human Rights Council in 2011.

According to the Guiding Principles, operational-level grievance mechanisms contribute to the

corporate responsibility to respect human rights intwo ways. First, they act as a feedback loop on acompany’s due diligence, enabling it to betterunderstand and manage possible impacts.Second, they provide an opportunity for affectedstakeholders to seek early and direct remedybefore problems escalate or result in potentiallycompounded harms.

The UN GuidingPrinciples onBusiness andHuman Rightsassign a prominentrole to grievancemechanisms underthe ‘Protect, Respectand Remedy’framework.

Grievance mechanisms are an integral part of acompany’s approach to stakeholder engagement.They should not be seen as a stand-alone processor as a substitute for engagement. Rather, they areone element in a mutually reinforcing set of systemsand activities.

Stakeholder engagement is designed to involveaffected communities in the process of identifyingand managing risks and impacts. Whenengagement is broad, continuous and inclusive,potential sources of concern are addressed at anearly stage, helping to prevent complaints fromarising in the first place. A grievance mechanism isdesigned to deal with complaints as and when theyarise. But by providing early warning of potentialproblems, and demonstrating a willingness to dealwith concerns promptly and effectively, itcontributes to a sense of trust and goodwill thatunderpins the more proactive aspects ofengagement. Good grievance handling supportsgood engagement and vice-versa. For thisreason, experience suggests that the earlier agrievance mechanism is introduced in the projectcycle, the better.

The nature of a project’s impacts on affectedcommunities strongly influences the design andresourcing of the mechanism. Since a project’sexposure to complaints is partly linked to itsimpacts, the grievance mechanism should bebroadly scaled to the level of risk involved fromboth a company and community perspective. This isparticularly important when impacts are severe orcomplex, for example in projects involvinginvoluntary resettlement, or in settings which maybe prone to conflict for other reasons.

Stakeholder engagement, grievance handling andimpact management are complementary parts ofan interdependent whole. Effective engagementcontributes to better impact management, whileeffective grievance mechanisms, by providing earlywarning of possible problems, contribute to both.The grievance mechanism encourages feedbackfrom the community, provides an opportunity forthe company to respond to questions and concernsand allows both real and perceived impacts to beaddressed. Embedding the mechanism withinexisting management systems has the addedbenefit of ensuring that it has internal traction andbecomes part of the normal way of doing business.

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Grievance mechanisms and stakeholder engagement

Effectiveness criteria

Effective grievance handling rests on a set offundamental principles designed to promote thefairness of the process and its outcomes. Whilstdifferent sources offer alternative versions of theseprinciples, the Effectiveness Criteria for non-judicial grievance mechanisms contained in theUN Guiding Principles on Business and HumanRights are broadly accepted as a keyinternational reference.

The Effectiveness Criteria state that operational levelgrievance mechanisms should be legitimate,accessible, predictable, equitable, transparent,

rights-compatible, dialogue-based and a source oflearning. These principles are meant to inform boththe design of the mechanism as well as thefunctioning of the process itself. They are meant tobe interpreted and applied in a flexible mannerdepending on the industry sector and the operatingenvironment. Recognizing the differences that existbetween industries, companies and localcircumstances, the Effectiveness Criteria describebroad characteristics rather than rigid specifications.

The eight Effectiveness Criteria are summarizedbelow.

1. Legitimate: enabling trust from the stakeholdergroups for whose use they are intended, andbeing accountable for the fair conduct ofgrievance processes.The grievance mechanism should be credible inthe eyes of its intended users for people to trustand use it. Users should have confidence that ifthey lodge a complaint, it will be treated in afair and objective manner. Both the process andits outcomes are important for establishing trustin the mechanism.

2. Accessible: being known to all stakeholdergroups for whose use they are intended, andproviding adequate assistance for those whomay face particular barriers to access.The mechanism should be known to all affectedstakeholders, regardless of language, gender,age, literacy level or socio-economic standing.The company should promote awareness of themechanism and understanding of its purposeand functioning. The mechanism should bereadily accessible, culturally appropriate, andshould not impede access to other forms ofremedy. The design of the mechanism shouldtake account of potential barriers to access, forexample in terms of cost, language, fear ofretaliation, as well as the needs of anyvulnerable or disadvantaged groups.

3. Predictable: providing a clear and knownprocedure with an indicative timeframe foreach stage, and clarity on the types of processand outcome available and means ofmonitoring implementation.A predictable grievance mechanism providesclarity to potential users about how the processworks, the timeline for resolving complaints, andthe types of outcome available. Predictabilityalso means that the grievance handling processitself operates in a consistent manner.

Predictability allows users to understand whatsteps will be followed when they submit acomplaint, and provides them with a contactpoint within the company. It also means

providing clarity about what kind of complaintsare in scope of the mechanism and the types ofoutcome available, as well as how agreedresolutions are followed up and monitored.

A predictable process builds trust. Respectingcomplainant’s concerns, keeping them informed,following up promptly on complaints, and beingseen to act consistently are essential to buildingconfidence in the mechanism and the companyas a whole.

4. Equitable: seeking to ensure that aggrievedparties have reasonable access to sources ofinformation, advice and expertise necessary toengage in a grievance process on fair,informed and respectful terms.The equitability principle refers to the fairness ofthe process and how it addresses imbalances ofpower or knowledge that may exist between thecompany and the complainant.

Barriers presented by culture, expertise,language, or socio-economic status may meanthat stakeholders are, or feel themselves to be, ata disadvantage when it comes to engaging withthe company about the way grievances areinvestigated or resolved. The equitability principleseeks to redress real or perceived imbalances byplacing responsibility on the company to helplevel the playing field. The complainant shouldhave reasonable access to information, adviceand expertise necessary to engage in thegrievance process on fair and equitable terms.Equitability also implies handling everygrievance consistently and with due respect forthe complainant, regardless of whether thecompany considers the issue to be well founded.

5. Transparent: keeping parties to a grievanceinformed about its progress, and providingsufficient information about the mechanism’sperformance to build confidence in itseffectiveness and meet any public interestat stake.The intent of the transparency principle is tobuild trust in the grievance mechanism by

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keeping complainants informed about theprogress of their case, and communicating withuser groups about the overall functioning of themechanism.

Transparency about outcomes does not implythat details of individual grievances should bemade public. Rather, the intent is that acompany should engage in a dialogue withstakeholders about the functioning andperformance of the mechanism. Transparencyshould also be weighed against otherconsiderations, such as the need to respectconfidentiality and avoid exacerbating tensionsbetween different groups.

6. Rights compatible: ensuring that outcomes andremedies accord with internationallyrecognized human rights.Human rights are an essential foundation uponwhich any grievance mechanism rests. Thisapplies both to the process itself as well as to theremedies obtained. In other words, a grievancemechanism should promote equitable resolutionprocesses and equitable agreements based oninformed decisions. A project-level grievancemechanism is not a substitute for, nor should itundermine, a complainant’s right to pursue otherjudicial or non-judicial avenues of remedy.

7. Continuous learning: drawing on relevantmeasures to identify lessons for improving themechanism and preventing future grievancesand harms.Grievance mechanisms contribute toinstitutional learning by making it possible forthe company to identify trends and patternsand take appropriate measures to reduce therisk of recurrences. The more grievances amechanism handles, the more experience theteam managing the process has to understandthe root causes of community concerns andhow to resolve them. This principle highlightsthe need to analyse root causes and focus onprevention as opposed to simply managinggrievances as they arise.

8. Based on engagement and dialogue:consulting the stakeholder groups for whoseuse they are intended on their design andperformance, and focusing on dialogue as themeans to address and resolve grievances.Engagement and dialogue form the foundationof the grievance handing process. This appliesto the design of the mechanism as well as theway in which the process operates, from thereceipt of a complaint through to investigation,resolution and follow-up.

Engaging with affected communities aboutthe design of the mechanism creates trust andhelps to build legitimacy around the process. Bybuilding a more responsive process than eitherof the parties could have achieved on their own,a collaborative approach brings advantages forboth the company and community.

Engagement is also the foundation forresolving grievances. Solutions reachedthrough dialogue better meet the interests ofthe parties than those imposed unilaterally.Open engagement helps the company andaffected communities minimize barriers andfind acceptable resolutions to the issuesidentified. Dialogue in itself can be a powerfultool to address grievances, especially whenneither side can prove their case, when acomplainant simply wants to be heard by thecompany or when the evidence does notsubstantiate the complaint.

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An effective grievance mechanism is codified in aset of steps and activities that are easy to followand understand. The exact process for receiving,investigating and resolving grievances may differfrom company to company and location tolocation. Most mechanisms will, however, follow aseries of basic process steps. This section reviewsthe procedural elements common to operationallevel grievance mechanisms.

The design of the mechanism in terms of itsgovernance and procedural steps provides variousopportunities for alignment with the EffectivenessCriteria.

The typical grievance mechanism is characterizedby seven basic steps, beginning with the receipt ofthe complaint and ending with its resolution orclose out. These steps are illustrated in Figure 2and described in further detail below.

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Basic process steps

1. ReceiveReceive at access point and document

2. Assess and assignAssess severity, decide investigation approach and assign action parties

3. AcknowledgeAcknowledge receipt and outline how complaint will be handled

4. InvestigateInvestigate complaint and identify options for resolution

5. RespondRespond to complainant, outlining investigation findings and proposed resolution

7. Follow up and close outImplement resolution, close out, monitor and evaluate

Complaint resolved successfully 6. Consider recourse or appeal

Complainant satisfied Complainant not satisfied

Figure 2 Process steps

1. Receive

Affected communities can access the grievancemechanism through any of the various channelsavailable to receive complaints, for example adedicated telephone number or email address, or aconvenient location in the community. Publicizingthe access points is part of the company’s outreachand awareness building. Trained company staff orauthorized third parties accept the grievance andforward it to a central point for registration.

2. Assess and assign

Once logged, a grievance officer conducts a rapidassessment to verify the nature of the grievance.Some companies classify the grievance accordingto a risk matrix based upon severity. The level ofseverity can determine who needs to be informedand who manages the case. For example,grievances classified as low or moderate may behandled by a grievance officer whereasgrievances ranked as high may be handled by amore senior manager. Building risk criteria into themechanism helps personnel to identify what actionis required to address the grievance in proportionto the impact.

The company unit associated with the problemshould also be informed that a complaint has beenfiled and the grievance officer may need to collectbasic information about the situation from theirperspective. Often issues that are low severity fromthe point of view of the complainant and thecompany can be resolved immediately through afast track process. Cases that require additionalinformation or investigation should proceed to Step 3.

3. Acknowledge

Upon registration, complainants should receive atimely acknowledgement that their case isregistered. Acknowledgement should be

communicated in an appropriate manner, such as aletter, telephone call or a copy of the grievanceform. The acknowledgement typically includesinformation about the next steps in the process,timelines and contact details of the grievanceofficer. This may be done at the time the grievanceis received or subsequently.

4. Investigate

Although many complaints can be addressed witha quick response by a grievance officer or othercompany staff, complaints of a severe ortechnically complex nature may require morethorough examination. This process begins byseeking to understand the complainant’s perceptionof the issue and what should be done about it. Theinvestigation then proceeds to look into thecircumstances of the case, speaking with theparties involved, and conferring with relevantstakeholders. In most companies, the unitassociated with the complaint conducts theinvestigation as it has the technical expertise. Theinvestigation verifies the facts of the complaintfrom a company perspective and the investigatorreports back to the grievance officer. In serious orcomplex cases, it may be advisable to segregateresponsibility for investigating complaints andauthorizing remedies from the role of liaison with

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the complainant in order to avoid possible conflictsof interest. Throughout this step, it is important tobe sensitive to the way in which the complainantexperiences the issue, as such an understandingmay be just as important to achieving a successfuloutcome as establishing the facts.

5. Respond

Once the investigation is complete, a provisionalproposal should be developed that is reasonableand proportional to the grievance and takesaccount of any cultural norms. Depending on theoutcome of the investigation, the companyresponse, including resolution options, is developedin-house first, especially when the outcome mightset a precedent or require a policy decision.

The provisional proposal is prepared and thegrievance officer discusses it with the complainantrather than unilaterally announcing the company’sverdict. The grievance officer may also indicateother available avenues of remedy. Thecomplainant has the opportunity to accept theproposition, offer an alternative for further

discussion, or reject it or consider another disputeresolution process. The final agreement should bespecific, time bound and agreed upon by bothparties. If not self-executing, it should include amonitoring plan. If the complaint is found to beunsubstantiated, the grievance officer shouldexplain the reasons and may indicate otherpossible avenues of remedy.

6. Consider recourse or appeal

The grievance mechanism should incorporate anappeals provision for complaints that cannot beresolved on the first attempt. Such procedures arefor exceptional cases and should be requiredinfrequently. Appeals provisions vary widely.Several recourse options are described below:● Elevate the issue to a review committee

composed of senior managers to considerwhether additional reasonable actions areappropriate.

● Elevate the issue to a review committeeconsisting of company and communityrepresentatives to consider whether additionalreasonable actions are appropriate.

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● Propose the use of an independent mediatoragreed upon by both the company and thecomplainant to facilitate further dialogue. Aprocedure for engaging a mediator should beestablished at the time the mechanism isdesigned.

● Involve a trusted, independent external party toassess the grievance and propose an impartialresolution.

● Establish a standing appeals committee jointlywith the community. The committee should consistof individuals who enjoy credibility with affectedcommunities and are viewed as impartial byboth sides. Such a system should be establishedat the time the mechanism is designed.

Should the appeals process fail to lead to a mutuallyacceptable resolution, the complainant shouldremain free to pursue other avenues of remedy.

7. Follow up and close out

Once a resolution has been agreed or a decisionmade to close out, the final stage is to implementthe resolution, monitor outcomes and close out thegrievance. Follow-up also addresses problems thatdevelop during implementation. In some cases,adjustments are necessary to ensure that root causesof complaints are addressed and outcomes are

consistent with the spirit of the original agreement.Experience from the follow-up can also be used tofurther refine the grievance handling process.

Closing out the grievance occurs after theimplementation of an agreed resolution has beenverified. Parties may be requested to providefeedback about their level of satisfaction with thegrievance handling process and the outcome.Even when an agreement is not reached, it isimportant to close the case, document the results,and request the parties’ evaluation of the processand its outcome.

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The existing literature refers to a number ofpotential elements of good practice in terms of thedesign and implementation of the grievancemechanism. Whilst many of these elements haveyet to be tested systematically within the oil and gasindustry, they are indicative of some of the ways inwhich the intent of the Effectiveness Criteria can betranslated into practice.

Table 1 (overleaf) presents a compilation of thesesuggested good practices, indicating how theycontribute to aligning the mechanism with the intentof the Effectiveness Criteria. This list is neitherexhaustive nor prescriptive.

Potential elements of good practice

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Table 1 Potential elements of good practice

No. Potential elements

Legi

timat

e

Acc

essi

ble

Pred

icta

ble

Effectiveness criteria

Equi

tabl

e

Tran

spar

ent

Righ

ts co

mpa

tible

Dia

logu

eba

sed

Con

tinuo

us

lear

ning

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

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Impose as few restrictions as possible on types of issue that can be raised underthe grievance mechanism

Allow the complainant to pursue other avenues of remedy if an agreed solutioncannot be reached

Respect the confidentiality of all parties to the grievance handling process

Take steps to protect parties to the grievance handing process from retaliation

Allow anonymous complaints where permitted by law

Take steps to prevent conflicts of interest within the grievance handing process

Scale the grievance mechanism to risks and impacts on affected communities

Engage stakeholders in the design of the mechanism

Take active steps to make the grievance mechanism as accessible to affectedcommunities as possible. Examples:• Publicize the existence of the mechanism widely (for example via community

meetings, local media, leaflets, websites)• Provide multiple points of access• Use community-based organizations as a possible point of access• Ensure access points are convenient in terms of location and hours of

availability• Ensure information about the mechanism is available in relevant local

languages

Communicate how the process works, as well as the timelines for handing agrievance and types of resolution available

Acknowledge receipt of complaints and provide regular status updates, forexample by letter, telephone or email

Put tracking systems in place for logging grievances and monitoring actions

Take steps to build confidence in the fact-finding process. Examples:• Meet face to face with complainants• Meet in the complainant’s home• Allow complainants to be accompanied by a friend or family member• Use independent third parties as technical experts or facilitators

Verify that outcomes are consistent with human rights

Provide appropriate training to staff and contractors on dealing with grievances

Seek feedback on the functioning of the mechanism. Examples:• Community surveys• Satisfaction surveys of previous complainants• Community meetings

Report to affected communities on the performance of the mechanism.Examples:• Provide feedback on typical cases and outcomes• Provide indicative data on number and type of grievances received

Analyse data on grievances and lessons learned to inform changes in policy orpractice that can help prevent recurrences

Have an assurance process to ensure the proper functioning of the mechanism

Section 2:

Design andimplementation

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This section explores the process of designing and implementing anoperational level grievance mechanism.

1. Form design team,engage stakeholders

• Form a cross-functional team

• Define scope,time frame anddeliverables

• Engage internaland externalstakeholders

4. Review andimprove

• Seek feedbackfrom stakeholders

• Assess grievance data• Gather lessons• Revise mechanism

as required

3. Design andimplement

• Understandexisting approachto grievances

• Design mechanism• Implement

2. Assess risk

• Assess affectedcommunities andimpacts

• Assess possiblegrievances

• Assess implicationsfor design andresourcing

Current practice highlights four basic steps forcompanies to follow in developing an effectivemechanism, as indicated in Figure 3. These stepsare discussed in further detail below.

Step 1: Form design team andengage stakeholders

The first step in establishing a grievancemechanism is to form a design team. The team willbe responsible for designing and implementing themechanism and promoting it inside and outside thecompany.

Since incoming grievances may raise issues that cutacross internal boundaries or involve interfaceswith existing systems, it is desirable for the designteam to be cross-functional in composition. Atypical team might be composed of representativesof Community Relations, Human Resources, Health,Safety & Environment (HSE), Security and Legal. Itshould operate under a senior managementsponsor to guide the process and ensure internalbacking.

Once assembled, the team should agree on ascope of work, roles and responsibilities, a timelinefor implementation and any resource requirements.To develop a preliminary plan, the team shouldconsult with internal and external stakeholders toget their feedback. Internal stakeholders mayinclude company functions, owners of existing

complaint handling processes, business managers,joint venture partners and contractors. Externalstakeholders will vary depending on theenvironment but could include community groups,civil society, NGOs, traditional leaders, localgovernment, representatives of indigenous groups,or representatives of any vulnerable ormarginalized groups.

Involving external stakeholders in the design of themechanism can make it more responsive to localneeds and improve its effectiveness. Meaningfulengagement promotes a sense of ownership andrespect for the mechanism, and encourages localpeople to use the process. When the company-community relationship is tense, consultation aboutthe grievance mechanism is likely to be morecomplex. Equally, however, it may also representan opening for constructive engagement.

Step 2: Assess risk

An early task for the design team is to conduct arisk assessment to evaluate the nature andfrequency of expected complaints. The results ofthis assessment will be used to guide importantdecisions about the design of the mechanism, itsresourcing and how stakeholders are engaged inthe process.

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Design and implementation

Figure 3 Design and implementation

The risk assessment should consider the full rangeof factors that could affect the pattern ofcomplaints and the effort required to addressthem. These may include the footprint of theoperation, its impacts, the size and make-up ofaffected communities, the legacy of any previousindustrial activity, and levels of trust in thegovernment and the company. It may also berelevant to consider how the complaint profilecould vary over the project life cycle.

The design team should also consider thetraditional ways in which disputes are resolved, thelocal dispute resolution culture, and availableresources. For example, some companies havebeen able to incorporate dispute resolutionresources, such as an ombudsman or acommunity-based conflict resolution service, intothe mechanism.

Mapping the operation’s complaints profile helps toinform decisions about how to scale themechanism, improve accessibility and trust, anddetermine the resources needed to implementeffectively.

Step 3: Design and implement

Based on the risk assessment and initialengagement with stakeholders, the design phaseties the various elements of the mechanism together.The following steps comprise a basic framework fordesigning the mechanism:● Scale to risk and impact: the scale of the

grievance mechanism should be determinedduring the risk assessment phase based on thevolume and types of grievances expected. Theassessment should inform subsequent decisionsabout design and resourcing.

● Define the scope of grievances accepted: thedesign team determines the range of grievancesthat will be accepted and identifies those thatfall outside its scope. The criteria for acceptanceshould be broad and flexible in order to

accommodate as wide a range of grievances aspossible. Grievances based on perception aswell as fact should be included.

● Understand existing approaches to complainthandling: most companies already have aformal or informal system for dealing withcommunity complaints. Understanding theexisting approach and building on what worksis a starting point for designing a newmechanism. As grievances may cut acrossinternal boundaries or pertain to issues forwhich an established procedure already exists,the team may also need to map any interfaceswith existing processes.

● Identify access points and methods: differentindividuals and groups may prefer to usedifferent channels to express a concern orgrievance. Multiple receiving methods should beaccommodated to promote access. Access pointsshould be culturally appropriate and takeaccount of all potential users, includingmarginalized or vulnerable groups.

● Develop the management framework: the finalstep in the design process is to develop themanagement framework for the grievancemechanism. The elements of this framework,which include an enabling policy, standardoperating procedure, personnel, training,supporting systems and resources are discussedin the following section. It may also be useful toincorporate potential elements of good practicesummarized in Table 1 (see page 14).

● Launch the mechanism: the launch of themechanism is an important opportunity to buildcredibility and demonstrate the company’scommitment to addressing complaints in aprofessional manner. Prior to launch, it isimportant to train staff and contractors andverify that access points are fully functional. Thedesign team should put in place acommunication and outreach strategy so thatemployees, contractors and the community knowabout the mechanism. Where stakeholders wereengaged as part of the design phase,community members and civil society groups will

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be aware of the process and can help to answerquestions and build awareness.

Once the system is developed, communicated andofficially launched, the grievance mechanism isready for implementation.

Step 4: Review and improve

Driving continuous improvement in businessperformance through a process of learning fromcomplaints is one of the most important functions ofthe grievance mechanism.

The purpose of learning from complaints is twofold.Firstly, it enables the company to assess thestrengths and weaknesses of the grievancemechanism and make adjustments where needed.Second, it helps to identify broader opportunitiesfor improvement in the way the company engagesstakeholders and manages impacts.

Monitoring and evaluation

Performance monitoring requires clear standardsand criteria. Emerging practice suggests thatcompanies should monitor both quantitative andqualitative indicators, such as the number and typeof complaints received, response times andfeedback from stakeholders about their satisfactionwith the process. Monitoring should be context-specific and embedded in existing systems.

Caution is needed when interpreting data oncomplaints. When an operation receives fewcomplaints, it may be an indication that impactsare well managed, but it could equally be awarning sign that the grievance mechanism isunknown, inaccessible or not trusted. Similarly, alarge number of complaints may indicateunhappiness with the company or, on the contrary,that stakeholders trust the mechanism and have nohesitation in using it. Consequently, the use oftrends or a basket of indicators may give a clearer

picture of the company’s performance than theabsolute number of grievances received.

A review process should be conducted periodicallyto check the functioning of the grievancemechanism. The review should report on trends ingrievances and assess the overall performance ofthe mechanism. The report should be reviewed bysenior management. Adjustments to the mechanismshould be approved by management, implementedand shared publicly if appropriate.

Continuous learning

Continuous learning from grievances can be apowerful tool for identifying emerging issues andhighlighting broader opportunities forimprovement. While a goal of having few or nocomplaints is unrealistic and can even becounterproductive, systematic learning can helpidentify actions to reduce the recurrence ofcomplaints and contribute to better overall businessperformance. Such analysis can also contribute toa ‘heat map’ analysis of emerging issues andprovide early warning of possible problems.

When designing the mechanism, it can be useful tothink in advance about the type of data or analysisthat will be most valuable to business decisionmakers so that these can be incorporated into theperformance monitoring framework. To ensurelearning is integrated into decision making, reportson trends in grievances should be providedregularly to relevant line and functional managers.Learning should also be used to make refinementsto the functioning of the mechanism itself.

Communicating performance

Companies are encouraged to communicate withexternal stakeholders about the overallperformance of the grievance handling process.Emerging practice suggests that companies shouldactively seek feedback on the mechanism fromcomplainants and community stakeholders at large.

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Companies should also share information about thefunctioning of the mechanism, for example in termsof the number and type of complaints received,indicative outcomes, the speed of resolution, andany changes in policy or practice made a result ofidentified trends. Practice in this area is evolving

and varied, with some companies choosing toreport publicly on complaints received while othersprovide more qualitative assessments ofperformance.

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Strategies for enhancing trust

In situations where the relationship between thecompany and communities is marked by anunderlying lack of trust, or where the operatingenvironment is complex for other reasons, it maybe appropriate to consider additional measures toenhance access and build trust in the grievancehandling process.

The need for additional accessibility and trustbuilding measures will often be identified as part ofthe risk assessment conducted at the time themechanism is established. Figure 4 illustrates aframework for assessing the need for further steps.

Some of the most effective strategies involve the useof participatory approaches to fact finding anddecision making, third parties in a mediation orfacilitation role or multi-stakeholder bodies. Theseare discussed below.

Joint fact finding and decision making

An essential part of trust building is theparticipation of stakeholders in processes that affecttheir interests. In grievance handling, problems canoften be resolved more effectively through

Figure 4 Assessing the need for trust building measures

Factors to consider

• Footprint of operation

• Nature and severity of impacts

• Nature of affected communities

• Expected frequency of complaints

• Expected nature of complaints

• Presence of vulnerable groups

• Existing dispute resolution culture

• Trust in government

• Attitudes to oil industry

• Presence of other operators

Assessment Potential approaches

Some complaints areexpected, but these donot reflect deep levelsof community concern

Complaints areexpected to be morefrequent or serious, orreflect deeper levels ofcommunity concern

Complaints are expectedto be unusually frequentor serious, or reflectexceptionally high levelsof community concern

Good practicemechanism


Measures toenhance access

and trust


Measures toenhance access

and trust

Third-party ormulti-stakeholder

involvement

Ada

pted

from

ICM

M, 2

009

collaborative approaches that involve thestakeholder in the process of finding a solution.

Joint fact finding refers to the practice of involvingstakeholders in the process of establishing theunderlying facts behind a grievance. Such anapproach can take many forms. It can range fromthe relatively informal, such as inviting thestakeholder to participate in an aspect of theinvestigation, to the more formal, such as forminga joint team of company and communityrepresentatives to look into an issue. Collaborativeapproaches do not preclude the company carryingout its own investigations and reaching its ownconclusions. But by involving stakeholders in theprocess of establishing the facts, the resultinginformation may have more credibility than if thecompany is seen to reach the same conclusions onits own.

Joint decision making is a process where thecompany and the community mutually decide onthe resolution of a grievance. This approach may beappropriate in settings where community membersshow a strong preference for collective approachesto problem solving, or where the issues involved areparticularly complex. Joint decision-making structurestake many forms, from informal consultations withcommunity leaders to standing bodies composed of

a mix of company and community representatives.Such an approach may be useful when thecredibility of the decision making process itself is acrucial factor in the acceptance of outcomes.

The use of third parties

Although existing guidance highlights the role ofthird parties in grievance resolution, companies aresometimes unclear about how to involve externalexperts. Third parties can serve as facilitators,access points for the mechanism, technical experts,co-investigators, mediators, appeals assessors oroversight panel members. Some companies havealso engaged third parties to provide independentmonitoring of the grievance mechanism on aregular basis.

Academic bodies, state agencies such as a localombudsman, non-profit organizations, andnetworks of individuals are all examples of thirdparties that have played a role in operational levelmechanisms. The community and the companyshould be able to trust the third party to beimpartial and to act in the common interest. Usinga third party at appropriate times in the grievanceprocess can lead to an acceptable resolution andhelp the company fulfil its broader responsibilities.

Use of multi-stakeholder bodies

Multi-stakeholder bodies may be a usefulframework for addressing grievances in situationswhere the issues are complex or touch uponmultiple interests. Such bodies can play variousroles in the grievance handling process, fromserving as a forum for communicating about thefunctioning of the mechanism to playing a moredirect role in the process. Although multi-stakeholder bodies require significant effort toestablish and maintain, they are often valuable forcreating a space in which the interests of variousparties to an issue can be reconciled.

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Section 3:

Managementframework

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For a grievance mechanism to be effective it should be fully integrated intoa company’s existing management framework. This section extractshighlights from the literature to illustrate some of the ways grievancemechanisms can be incorporated into company management systems.

Policy or standard

Culture and commitment

Standardoperatingprocedure

People TrainingSystems, tools

andresources

Learningand

assurance

foundation organization processes culture

Grievance mechanisms should be considered anintegral part of a company’s broader approach tostakeholder engagement. They also interact withother management processes for health, safety,security, environment and social performance.Because the management of these processes differsfrom company to company, the way in whichgrievance mechanisms are embedded in thisframework will vary as well.

In terms of the way a company receives,investigates and follows up complaints, a grievancemechanism is fundamentally a business process. Assuch, it requires a management frameworkconsisting of an enabling policy or standard,standard operating procedures, qualified personnelwith well-defined roles and responsibilities,appropriate resources and an assurance process.Less tangible but just as important is managementcommitment and a company culture ofresponsiveness towards dealing with complaints.

These elements of a management framework forgrievance mechanisms are illustrated in Figure 5.Each element is discussed below.

Policy or standard

At the highest level, a grievance mechanism shouldbe governed by an enabling policy or standard.This may take the form of a stand-alone policy or acommitment incorporated in existing policies onstakeholder engagement or social performance.Depending on the company’s approach, the policymay also specify the situations in which arequirement applies and the managers responsiblefor its implementation.

Standard operating procedure

At an operating level, the grievance mechanismshould be managed in accordance with a standardoperating procedure which sets out the detailedsteps to be followed when dealing with complaints.The content of the procedure will vary fromcompany to company but typically includes suchbasic elements as the objectives of the process, itsscope, the roles and responsibilities of staff andcontractors, the process steps to be followed andtypes of performance data to be monitored.

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Management framework

Figure 5 Management framework for grievance mechanisms

People

Implementing the grievance mechanism requiresqualified staff with clearly defined roles andresponsibilities.

The workflow for handing a grievance typicallyinvolves several distinct roles: liaising withcomplainants; investigating concerns; implementingresolutions; and exercising custodianship over theprocess itself. These roles may be played bydifferent managers depending on the company,with the precise allocation of roles andresponsibilities being made at the time thegrievance mechanism is designed. When assigningroles and responsibilities, it is also important toconsider the role of contractors or third parties andhow they will interact with the process.

Whatever approach the company adopts, rolesand responsibilities in the grievance handingprocess should be incorporated in relevant jobdescriptions and performance objectives.

Training

Staff or contractors who have a role in thegrievance handling process may require trainingin order to perform their job effectively. Duringthe process of designing the mechanism, thecompany should identify personnel who will havea role in the process and the type of trainingrequired for them to perform effectively. Forcommunity liaison staff, this could include trainingin basic conflict resolution and grievance handlingskills. Staff involved in investigating grievancesmay require training in investigativemethodologies and engagement skills. For otherstaff or contractors with community facing roles,an awareness session on the mechanism and howit works is appropriate.

Systems, tools and resources

Effective grievance mechanisms often requiresupporting tools and systems to enable them tofunction efficiently.

One of the most important is an informationmanagement system for tracking grievances. Thesesystems vary widely in terms of functionality, costand the degree to which they integrate withexisting systems. The most sophisticated aredesigned to fully automate the grievance handlingprocess by allowing the company to registergrievances, monitor their status, provide notificationof overdue actions and generate reports. Othersystems are more modest, and are limited tocapturing basic data on a complaint. Whateveroption is chosen, such systems must comply withapplicable data protection laws.

Various resources will be required to implement thegrievance handling process. These may includeresources for dedicated personnel, training,external communications material, consultants, theuse of neutral third parties as facilitators ormediators, and any costs associated with theprocess of investigating and resolving individualgrievances. These costs should be included in therelevant budget planning process.

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Assurance

As with other business processes, grievancemechanisms may be subject to periodic internalassurance to ensure that appropriate controls are inplace and that the process is functioning in linewith established policy. Where the grievancemechanism has been incorporated into an existingcompany policy framework, it will usually besubject to the assurance regime relevant to thatframework.

Culture and commitment

The best policies, procedures, people and systemswill not enable a company to deal effectively withgrievances if the leadership and internal culture arenot supportive. This requires that the business casefor grievance mechanisms be widely communicatedand understood throughout the organization. Thefact that grievances often cut across internalboundaries or require multidisciplinary responsesunderscores the importance of senior managerssetting the tone and encouraging a culture in whicheveryone is responsible for complaints. It isimportant for managers to communicate theseexpectations clearly to both staff and contractors.

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CAO (2008). A Guide to Designing andImplementing Grievance Mechanisms forDevelopment Projects. The Compliance AdvisorOmbudsman for The International FinanceCorporation. Washington, 2008. www.cao-ombudsman.org/howwework/advisor/documents/implemgrieveng.pdf

Harvard University (2008). Rights-CompatibleGrievance Mechanisms: A Guidance Tool forCompanies and Their Stakeholders. The CorporateSocial Responsibility Initiative of the HarvardKennedy School. Boston, 2008.www.hks.harvard.edu/m-rcbg/CSRI/publications/Workingpaper_41_Rights-Compatible%20Grievance%20Mechanisms_May2008FNL.pdf

ICMM (2009). Human Rights in the Mining andMetals Industry: Handling and Resolving Local LevelConcerns and Grievances. The InternationalCouncil on Mining and Metals. London, 2009.www.icmm.com/page/15816/human-rights-in-the-mining-metals-sector-handling-and-resolving-local-level-concerns-grievances

IFC (2007). Stakeholder Engagement: A GoodPractice Handbook for Companies Doing Businessin Emerging Markets. International FinanceCorporation. Washington, 2007.www.ifc.org/ifcext/enviro.nsf/attachmentsbytitle/p_stakeholderengagement_full/$file/ifc_stakeholderengagement.pdf

IFC (2009). Addressing Grievances from Project-Affected Communities. IFC ‘Good Practice Note’.International Finance Corporation. Washington, 2009.http://www1.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/ifc+sustainability/publications/publications_gpn_grievances

IPIECA (2011). Indigenous Peoples and the Oil andGas Industry: Context, Issues and Emerging GoodPractice. IPIECA. London, 2011.www.ipieca.org/sites/default/files/publications/indigenous_people.pdf

Kemp, Deanna and Bond, Carol, J. (2009). MiningIndustry Perspectives on Handling CommunityGrievances: Summary and Analysis of IndustryInterviews. Centre for Social Responsibility inMining (CSRM), University of Queensland and theCorporate Social Responsibility Initiative of theHarvard Kennedy School. Queensland, 2009.www.hks.harvard.edu/m-rcbg/CSRI/publications/other_mining_industry_perspectives_on_handling_community_grievances.pdf

Kemp, Deanna and Gotzmann, Nora (2009).Community Complaints and Grievance Mechanismsand the Australian Minerals Industry. Centre forSocial Responsibility in Mining, University ofQueensland. Queensland: 2009.www.csrm.uq.edu.au/docs/CSRM%20Community%20Complaints%20and%20Grievance%20Discussion%20Paper%202009%20_FINAL%20REPORT.pdf

Rees, Caroline (2011). Piloting Principles forEffective Company-Stakeholder GrievanceMechanisms: A Report of Lessons Learned. TheCorporate Social Responsibility Initiative of theHarvard Kennedy School. Boston, 2011.www.hks.harvard.edu/m-rcbg/CSRI/publications/report_46_GM_pilots.pdf

Ruggie, John (2008). Promotion and Protection ofAll Human Rights, Civil, Political, Economic, Socialand Cultural Rights, including the Right toDevelopment: Protect, Respect and Remedy: AFramework for Business and Human Rights. Reportof the Special Representative of the United NationsSecretary-General on the Issue of Human Rightsand Transnational Corporations and Other BusinessEnterprises. United Nations Human Rights Council.Geneva, 2008 www.business-humanrights.org

Ruggie, John (2011). Guiding Principles onBusiness and Human Rights: Implementing theUnited Nations ‘Protect, Respect and Remedy’Framework. United Nations Human Rights Council.Geneva: 2011. www.business-humanrights.org/media/documents/ruggie/ruggie-guiding-principles-21-mar-2011.pdf

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Resources and further reading

Acknowledgements

This publication was prepared by the IPIECA Human Rights Task Force under the auspices of the SocialResponsibility Working Group. IPIECA gratefully acknowledges Susan Wildau of CDR Associates and LucZandvliet of Triple R Alliance for contributing their expertise to the development of this document. IPIECAalso thanks Dr Deanna Kemp and Julie Kim of the Centre for Social Responsibility in Mining at theUniversity of Queensland for commenting on an earlier draft. IPIECA is solely responsible for thispublication and the involvement of these individuals does not imply any endorsement of its contents.

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