Reputational Risk While reputational risks are not a focus of human rights assessments, doing business with certain entities may bring significant reputational risk for SaaS providers. As long as they are connected to an entity causing harm, providers should accept the consequences of this risk. Principle 19 of the UNGPs states: “In any case, for as long as the abuse continues and the enterprise remains in the relationship, it should be able to demonstrate its own ongoing efforts to mitigate the impact and be prepared to accept any consequence—reputational, financial, or legal—of the 20 continuing connection”. The SaaS Value Chain An important part of human rights due diligence is identifying rightsholders that may be impacted, even though this may be challenging for B2B SaaS providers who have low levels of visibility into end-use of their products and services. To understand different groups of right- sholders that may be impacted adversely through the use of SaaS services, we should first look at SaaS providers’ location in the value chain. SaaS providers sit towards the beginning of the value chain. They receive inputs from suppliers to create software service offerings, which are then made available to customers across a range of industries and geographies, either directly or via distributors, resellers, or systems integrators. Typically, customers’ employees use the services for business operations, or to create other products or services with direct impacts on other rightsholders. Value Chain Supplier SaaS Provider Distributor / Customer / End-User / Reseller Direct User Rightsholder Human rights impacts related to the end-use of SaaS services can occur anywhere in the downstream value chain. It is important for SaaS providers to assess impacts not only on the end-user, but also on the direct user and other groups that may be impacted along the value chain. Even individuals who do not interact with a SaaS service can be impacted through the end-use of that service. 14 Human Rights Assessment of the Software-as-a-Service Sector
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