Dato’ Sri Azalina Othman Said, Minister in the Prime Minister’s Department (Law and Institutional Reform), launched the Human Rights Due Diligence Guide for Businesses on 7 October 2026. The Guide was unveiled during the National Conference On Business and Human Rights 2026.
The Guide is intended to help Malaysian businesses, regardless of size or industry, understand and progressively implement human rights due diligence (‘HRDD’) in their operations and business relationships.
In this article, we examine the Guide’s six-step HRDD framework and its practical implications for businesses in Malaysia.
The Guide is one of the initiatives under Malaysia’s National Action Plan on Business and Human Rights2025-2030, and draws on internationally recognised standards. These include:
Business activities, whether through direct operations, products, services or business relationships, can affect the rights and well-being of workers, consumers, communities and other individuals. The Guide positions HRDD as a practical, risk-based process for identifying and addressing these impacts before they escalate into harm, disputes, reputational damage or supply chain disruptions.
According to the Guide, businesses are expected to build on existing systems rather than create parallel structures. These systems may include HR policies, occupational safety and health frameworks, procurement processes, risk management systems, and grievance mechanisms.
In line with the UNGPs and OECD Due Diligence Guidance for Responsible Business, the Guide provides six interconnected steps that businesses can apply as an ongoing process. Employers should note that these steps are not meant to be completed once and shelved. Businesses are expected to reassess their human rights risks regularly, particularly where there are changes to operations, workforce, business relationships or the broader operating environment.The steps are summarised below:
Step 1: Embed human rights commitment into policies and management
Businesses should secure senior leadership commitment and assign responsibility for human rights to an appropriate function. They should then develop or strengthen a human rights policy that:
• expresses a clear commitment;
• defines its scope; and
• sets out the business's approach to prevention, remediation and grievance handling.
The policy should be communicated to employees, suppliers and other stakeholders and integrated into day-to-day decision-making.It should also be periodically reviewed and updated in light of feedback and changing risks.
Step 2: Identify and assess human rights risks and impacts
Businesses should map their operations, business relationships and the individuals or groups who may be affected. They should then identify actual and potential impacts across areas such as forced labour, child labour, discrimination, safety, wages and working hours. Where appropriate, they should engage affected rightsholders. In this context, affected rightsholders are individuals whose human rights may be affected by a business’s activities, products or services. Identified impacts should be assessed and prioritised by severity and likelihood. The business should determine whether it causes, contributes to, or is directly linked to each impact, since this shapes the appropriate response under step three.
Step 3: Take action to prevent, mitigate and address impacts
Businesses should integrate the findings from Step two into relevant policies, procedures and decisions. This may include supplier contracts, procurement practices and recruitment and safety standards.They should also take reasonable steps to prevent or mitigate potential impacts. Where an actual adverse impact has occurred, the business should act according to its level of involvement, whether by ceasing its own conduct or using leverage over a business partner. They should ensure workers and other stakeholders have access to an effective operational-level grievance mechanism.
Step 4: Track implementation and results
Businesses should set simple, relevant indicators linked to the risks identified and actions taken, and collect both quantitative data and qualitative feedback from affected workers and stakeholders to assess whether a response is actually working. Where an action proves ineffective or only partially effective, the business should adjust its approach, which may include strengthening supplier engagement, revising internal practices, or developing further corrective measures as part of a continuous improvement cycle.
Step 5: Communicate how impacts are addressed
Businesses should communicate relevant information, such as their human rights commitments, significant risks identified, actions taken, and access to grievance mechanisms, through channels proportionate to their size and context. This may include sustainability reports, company websites or direct employee and supplier communications. Communication should be accessible and meaningful to its intended audience.
Step 6: Provide for or cooperate in remediation when appropriate
Where an actual adverse impact has caused harm, businesses should determine whether remediation is required based on their involvement, and should engage affected persons to understand the harm suffered and the remedy they consider appropriate. Appropriate remediation may take the form of restitution, compensation, rehabilitation, apology, corrective action or guarantees of non-repetition, and should be implemented, monitored and used to draw lessons that prevent similar impacts from recurring.
The Guide also provides a sample HRDD self-assessment checklist, policy templates and sample action plan which may be useful for businesses intending to conduct their own assessment.
While the Guide is not law, it provides some welcome guidance to employers and business owners on the process and underlying principles of conducting HRDD.
Although the Guide does not impose prescriptive compliance obligations, it signals the Malaysian Government’s expectation of businesses, across all sizes and sectors, to progressively move beyond baseline legal compliance towards a more structured approach to identifying and addressing human rights risks in their operations and value chains.
Additionally, businesses in Malaysia with regional or international footprints should be mindful of parallel developments. This includes supply chain and sustainability due diligence requirements in other jurisdictions, which may impose more stringent and prescriptive obligations on Malaysian suppliers and subsidiaries. Failure to comply with these frameworks may attract sanctions from the relevant foreign authorities.
Businesses that begin reviewing their existing policies and processes against the Guide’s six-step HRDD framework now will be better positioned to respond as these expectations, whether from regulators, customers, investors or business partners, continue to develop.
Early identification of human rights risks will minimise supply chain disruptions and potential risks of reputational damage and disputes.
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