Human Rights & Business
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1 Human Rights & Business Main Developments, Issues and Challenges Lund MA Course (2h) December 2014 Stéphanie Lagoutte, Senior Researcher Danish Institute for Human Rights 1
2 INTERNATIONAL COMMUNITY Clear international HR standards and market incentives CIVIL SOCIETY Pressure on States and companies to regulate / adopt good practices COMPANIES Values, policies and systems that reflect and support human rights principles NATIONAL GOVERNMENTS Home and host countries make and enforce laws that protect human rights Stéphanie Lagoutte, Senior Researcher, DIHR 2
3 OVERVIEW: Starting point = the UN Guiding Principles Globalization and role of NSA Issues & rights at stake John Ruggie s work Other initiatives (UN Global Compact, OECD Guidelines, etc.) General principles: Protect, Respect & Remedy State duties Corporate responsibilities Challenges Stéphanie Lagoutte, Senior Researcher, DIHR 3
4 STARTING POINT: UN Guiding Principles on Business and Human Rights: Implementing the United Nations Protect, Respect and Remedy Framework Annex to the Report of the Special Representative of the Secretary-General on the issue of human rights and transnational corporations and other business enterprises, John Ruggie 16 June 2011: report (and GPs) endorsed by the Human Rights Council on its Seventeenth session Global standard for preventing and addressing the risk of adverse impacts on human rights linked to business activity Builds on major research and extensive consultations with all relevant stakeholders, including States, civil society and the business community. Stéphanie Lagoutte, Senior Researcher, DIHR 4
5 Issues and Rights at stake (1) Rio Tinto (Papua New Guinea): Discrimination, war crime and crime against humanity Talisman Energy Inc. (Sudan): Forced movement of civilians residing near oil facilities Chevron Corp. (Nigeria): Nigerian soldiers suppressed a protest against Chevron's environmental and business practices on a Chevron offshore drilling platform in 1998 Shell (Nigeria): oil pollution and oil spills Amesys and Qosmos (Syria and Libya): Providing surveillance equipment to Syrian and Libyan regimes Stéphanie Lagoutte, Senior Researcher, DIHR 5
6 Issues and Rights at stake (2) Forced labour Child labour Freedom of association and the right to collective bargaining Disciplinary practices Discrimination Health and safety Working conditions (working hours) + high risk industries + informal sector Stéphanie Lagoutte, Senior Researcher, DIHR 6
7 Globalisation and role of Non State Actors (1) Non-state actors such as transnational corporations and other business play an increasingly important role both internationally, but also at the national and local levels: Growing reach and impact of business enterprises roles and responsibilities of such actors with regard to human rights? International human rights standards have traditionally been the responsibility of governments, aimed at regulating relations between the State and individuals and groups. Example: European Court of Human Rights case law on environmental pollution and hazards and the right to respect for private and family life and for home (+right to life) Stéphanie Lagoutte, Senior Researcher, DIHR 7
8 Globalisation and role of Non State Actors (2) FRINGE ERA Early cases denied / refuted 1995 ACTIVIST ERA NGOs take up highprofile cases Boycott campaigns Stéphanie Lagoutte, Senior Researcher, DIHR BUSINESS ERA Company codes of conduct CSR reports UN Global Compact Equator Principles Multistakeholder initiatives Lawsuits PROFESSIONAL ERA UN treaty bodies Ruggie mandate Other UN Special Rapporteurs JURIDIFICATION ERA? DIHR
9 Globalisation and role of Non State Actors (3) The issue of business impact on the enjoyment of human rights has been placed on the agenda of the United Nations. Over the past decade, the United Nations human rights machinery has been considering the scope of business human rights responsibilities and exploring ways for corporate actors to be accountable for the impact of their activities on human rights. Existing UN Special Procedures have responded to specific allegations of business-related human rights abuses by sending communications to the companies and governments involved, conducting country visits to examine the allegations, and issuing recommendations to the relevant stakeholders. RESULT: greater clarity about the respective roles and responsibilities of governments and business with regard to protection and respect for human rights. Stéphanie Lagoutte, Senior Researcher, DIHR 9
10 John Ruggie s work (1) 2005: UN Secretary-General Kofi Annan appointed Professor John Ruggie as the Special Representative of the Secretary-General on human rights and transnational corporations and other business enterprises (SRSG) June 2008: Protect, Respect and Remedy Framework Policy framework Three principles: 1. State duty to protect against human rights abuses by third parties, including business; 2. Corporate responsibility to respect human rights; 3. Greater access by victims to effective remedy The HR Council unanimously welcomed the identification of the Framework, and extended the SRSG s mandate until 2011 with the task of providing guidance on operationalizing the Framework. Stéphanie Lagoutte, Senior Researcher, DIHR 10
11 John Ruggie s work (2) May 2011: Guiding Principles for the Implementation of the United Nations Protect, Respect and Remedy Framework. July 2011: UN Working Group on the issue of human rights and transnational corporations and other business enterprises is established by a resolution of the Human Rights Council : five independent experts promote the effective and comprehensive dissemination and implementation of the GPs on BHR. Stéphanie Lagoutte, Senior Researcher, DIHR 11
12 United Nations Global Compact UN initiative to encourage businesses worldwide to adopt sustainable and socially responsible policies, and to report on their implementation. 10 principles in the areas of human rights, labour, the environment and anti-corruption. Companies are brought together with UN agencies, labour groups and civil society. Stéphanie Lagoutte, Senior Researcher, DIHR 12
13 UN Global Compact 10 principles Human Rights / Businesses should: Principle 1: Support and respect the protection of internationally proclaimed human rights; and Principle 2: Make sure that they are not complicit in human rights abuses. Labour Standards / Businesses should uphold: Principle 3: the freedom of association and the effective recognition of the right to collective bargaining; Principle 4: the elimination of all forms of forced and compulsory labour; Principle 5: the effective abolition of child labour; and Principle 6: the elimination of discrimination in employment and occupation. Environment / Businesses should: Principle 7: support a precautionary approach to environmental challenges; Principle 8: undertake initiatives to promote environmental responsibility; and Principle 9: encourage the development and diffusion of environmentally friendly technologies. Anti-Corruption Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery. Stéphanie Lagoutte, Senior Researcher, DIHR 13
14 OECD Guidelines for Multinational Enterprises OECD Guidelines for Multinational Enterprises are annex to the OECD Declaration on International Investment and Multinational Enterprises. - far-reaching recommendations addressed by governments to multinational enterprises operating in or from adhering countries. - recommendations providing principles and standards for responsible business conduct for multinational corporations operating in or from countries adhered to the Declaration. Stéphanie Lagoutte, Senior Researcher, DIHR 14
15 Other Initiatives IFC Performance Standards Extractive Industries Transparency Initiative (EITI) ISO SA 8000 Global Reporting Initiative Stéphanie Lagoutte, Senior Researcher, DIHR 15
16 Controversies Who are the stake-holders? Who are the duty-bearers? States (extraterritoriality) Companies Enforcement of who s rights by who? Stéphanie Lagoutte, Senior Researcher, DIHR 16
17 INTERNATIONAL COMMUNITY Clear international HR standards and market incentives CIVIL SOCIETY Pressure on States and companies to regulate / adopt good practices COMPANIES Values, policies and systems that reflect and support human rights principles NATIONAL GOVERNMENTS Home and host countries make and enforce laws that protect human rights Stéphanie Lagoutte, Senior Researcher, DIHR 17
18 The UN Guiding Principles (1) States have an obligation to respect, protect and fulfil human rights and fundamental freedoms Business enterprises as specialized organs of society performing specialized functions, are required to comply with all applicable laws and to respect human rights Rights and obligations must be matched to appropriate and effective remedies when breached. The GPs apply to all States and to all business enterprises, both transnational and others, regardless of their size, sector, location, ownership and structure Stéphanie Lagoutte, Senior Researcher, DIHR 18
19 The UN Guiding principles (2) Coherent whole Should be read, individually and collectively In terms of their objective of enhancing standards and practices with regard to business and human rights so as to achieve tangible results for affected individuals and communities contributing to a socially sustainable globalization. no new international law obligations no limiting or undermining any legal obligations a State may have undertaken or be subject to under international law with regard to human rights Stéphanie Lagoutte, Senior Researcher, DIHR 19
20 The UN Guiding principles (3) Implementation in a non-discriminatory manner Particular attention to the rights and needs of, as well as the challenges faced by, individuals from groups or populations that may be at heightened risk of becoming vulnerable or marginalized, and with due regard to the different risks that may be faced by women and men. Stéphanie Lagoutte, Senior Researcher, DIHR 20
21 Pillar 1 State Duty to protect against business-related human rights abuses GP1. State duty to protect GP2. Extraterritoriality GP3. General regulatory and policy function GP4. State Business GP5 & 6 Privatisation and public procurement GP7. Conflict-affected areas GP8-10. Policy Coherence: Capacity building of state institutions Economic agreements concluded by States States as members of multilateral institutions Stéphanie Lagoutte, Senior Researcher, DIHR 21
22 Pillar 2 - Corporate Responsibility to respect human rights GP11&12. BUSINESS, HR AND THE UNGPs GP13 & 14. HUMAN RIGHTS IMPACTS GP15&16. HUMAN RIGHTS POLICY COMMITMENT Policy content and development Embedding policy commitment GP17 to 20. HUMAN RIGHTS DUE DILIGENCE Operational Scope and Business Relationships [GP17] Assessing Human Rights Risks and Impacts [GP18] Mitigation of human risks and impacts [GP18] Leverage [GP19] Effectiveness of response [GP20] GP21. REPORTING AND COMMUNICATION Reporting Requirements [see GP3] Communication by business enterprises [GP21] Stéphanie Lagoutte, Senior Researcher, DIHR 22
23 Pillar 3 Access to remedy GP 25. Appropriate steps to investigate, punish and redress GP 26. State-based judicial mechanisms (no legal, practical or procedural) barrier prevent legitimate cases from being brought before the courts + Imbalances between parties GP27. State-based non-judicial grievance mechanisms (Imbalances and barriers) GP28. Non-State-based grievance mechanisms Stéphanie Lagoutte, Senior Researcher, DIHR 23
24 Pillar 3 Access to Remedy (2) GP29. Operational-level grievance mechanisms Identification of adverse human rights impacts Remediation by the business enterprise Criteria to ensure their effectiveness in practice GP30. Collaborative initiative re. human rights-related standards: Commitments undertaken by industry bodies, multi-stakeholder, and other collaborative initiatives, Through codes of conduct, performance standards, global framework agreements between trade unions and transnational corporations, etc. GP31. Effectiveness criteria for non-judicial grievance mechanisms: Legitimate, accessible, predictable, equitable, transparent, rights-compatible, a source of continuous learning, based on engagement and dialogue Stéphanie Lagoutte, Senior Researcher, DIHR 24
25 Example: GP3/ Scrutinising State policies and regulations In meeting their duty to protect, States should: (a) Enforce laws that are aimed at, or have the effect of, requiring business enterprises to respect human rights, and periodically to assess the adequacy of such laws and address any gaps; (b) Ensure that other laws and policies governing the creation and on-going operation of business enterprises, such as corporate law, do not constrain but enable business respect for human rights; (c) Provide effective guidance to business enterprises on how to respect human rights throughout their operations; (d) Encourage, and where appropriate require, business enterprises to communicate how they address their human rights impacts. Stéphanie Lagoutte, Senior Researcher, DIHR 25
26 GP3 Implications (1) (1) Legislation that directly or indirectly regulate business respect for HR non-discrimination laws (which grounds of discrimination are mentioned in the law), labour laws, law on criminal and civil liability? (corporate liability, attribution of liability, etc.), environmental law, property/access to land, privacy law, consumers law, anti-bribery laws, etc. + due diligence requirement in the law (general or specific to some high-risk business activities) + proper enforcement of laws on BHR + Review of existing laws Stéphanie Lagoutte, Senior Researcher, DIHR 26
27 GP3 Implications (2) (2) Policies that seek to foster business respect for human rights National Action Plans on HR, on CSR, on BHR, CSR policies, HR and anti discrimination policies, Policies that encourages business enterprises HR due diligence, Sectorspecific policies concerning high-risk industries, etc. + Evaluation of these policies + outcome of this evaluation re. BHR: Follow up/evaluation report, new legislation Stéphanie Lagoutte, Senior Researcher, DIHR 27
28 GP3 Implications (3) (3) Laws and policies that govern the creation and on-going operation of business enterprises: Corporate and securities laws have HR implications Laws and policies which state clearly what companies and their officers are permitted, let alone required, to do regarding human rights: Legal requirement of a human rights at incorporation or listing of companies at the stock-exchange. Regulation encouraging or providing for a provision in the corporation s articles of incorporation to include a provision re. the corporation human rights responsibility (similar considerations when listing companies at the stock-exchange) Laws and policies which set a regulatory framework for directors duties to consider human rights impacts of their company s activities: Direct requirement to consider human rights impacts / indirect requirement through a requirement to act in the company best interest Permission for directors to consider human rights impacts Involvement of existing governance structures such as corporate boards in monitoring the HR performance of the enterprise? Stéphanie Lagoutte, Senior Researcher, DIHR 28
29 GP3 Implications (4) (4) Guidance provided by the State to business enterprises on respecting human rights Examples: indication of expected outcomes as far as HR performance is concerned providing information regarding national law and HR responsibility of companies sharing of best practices advising on appropriate methods, including HR due diligence guidance on how to meet effectively the specific challenges that may be faced by indigenous peoples, women, national or ethnic minorities, religious and linguistic minorities, children, persons with disabilities, and migrant workers and their families specific guidance provided for companies working in high-risk sectors Stéphanie Lagoutte, Senior Researcher, DIHR 29
30 GP3 Implications (5) (5) NHRI S role in the field The State may recognise and support NHRI role in the field: BHR mentioned in the law establishing NHRI + financing of NHRI activities within the field of BHR. The State supports the NHRI role in helping the State identify whether relevant laws are aligned with their human rights obligations and are being effectively enforced providing guidance on human rights also to business enterprises and other non-state actors monitoring public measures to regulate business and provide access to justice for victims of corporate human rights abuses Stéphanie Lagoutte, Senior Researcher, DIHR 30
31 GP3 Implications (6) (6) Requirement re. communication by business enterprises (incl. reporting) Examples: Reporting requirements Legal requirement for companies to have public consultations before any major project affecting the population FPIC (free prior and informed consent) requirements on lands used by indigenous people Mandatory public release of social and environmental impact assessment by companies Mandatory financial reporting, which include element s relevant to HR? Non-financial mandatory reporting? Specific mandatory reporting in sectors where the nature of business operations or operating contexts pose a significant risk to human rights? Stéphanie Lagoutte, Senior Researcher, DIHR 31
32 GP3 Implications (6bis) (6) Requirement re. communication by business enterprises (incl. reporting) Policy or legislation requirement as to what constitutes adequate communication and reporting: Requirements re. accessibility Requirement re. accuracy of reporting Comply or explain mechanism (see German Corporate Governance Code) Implementation mechanism of mandatory reporting: Examples: Auditing of report and verification of information Publication of report Sanctions in case of publication of false report/information Stéphanie Lagoutte, Senior Researcher, DIHR 32
33 Challenge 1: Which state duty& which corporate responsibility (1) Major difference btw HR in morals and political rhetoric and HR in the form or international law is the nature of the dutyholders: obligations placed almost entirely on States. HR can be violated by non-state actors (NSA), ex: slavery, terrorism or violence against women are most often perpetrated by NSA/private individuals. International law does not ignore the threats that NSA pose but, with very few exceptions, it does not directly impose duties on NSA to refrain from such action instead it requires each state not only to respect human rights itself, but also to take steps to protect rights from interference by NSA Stéphanie Lagoutte, Senior Researcher, DIHR 33
34 Challenge 1: Which state duty& which corporate responsibility (2) No direct application, but: 1. States have duties to regulate corporations, along with other private actors, to ensure the enjoyment of human rights. 2. Some international agreements and HR bodies specifically include legal as well as natural persons in setting out indirect duties: CEDAW: States parties shall take all appropriate measures to eliminate discrimination against women by any person, organization or enterprise (CEDWA, Art. 2.3) CESCR: States obligation to protect the right to water requires them to prevent third parties, including individuals, groups, corporations and other entities from interfering with this right Stéphanie Lagoutte, Senior Researcher, DIHR 34
35 Challenge 1: Which state duty& which corporate responsibility (3) States horizontal human rights obligations: How to secure that NSA such as private business enterprises do not commit abuses that would amount to human rights violations How to translate into regulation the expectation / requirement that business enterprises protect HR Horizontal obligation to require HR due diligence by business enterprises Stéphanie Lagoutte, Senior Researcher, DIHR 35
36 Challenge 2: Extraterritoriality (1) GP 2: States should set out clearly the expectation that all business enterprises domiciled in their territory and/or jurisdiction respect human rights throughout their operations. Main issue: the exercise of extraterritorial jurisdiction by a home state over the overseas activities of a transnational company with some link to that state (domicile, registration or listing on the territory or within the jurisdiction of the state). Stéphanie Lagoutte, Senior Researcher, DIHR 36
37 Challenge 2: Extraterritoriality (2) Extraterritorial application of human rights obligations is a known, albeit disputed, element of international human rights protection. HRC GC 31 on the Nature of the General Legal Obligation on States Parties to the Covenant ECtHR case-law : states can be held responsible for extraterritorial violations of Convention rights if it exercises effective control over an area or a rightsholder outside its territory (acts or omissions abroad by state actors, mostly military forces) Stéphanie Lagoutte, Senior Researcher, DIHR 37
38 Challenge 2: Extraterritoriality (3) Context of human rights and business: State-owned enterprises operating abroad or private business enterprises which carry out government functions and can be considered as State s agents, provided that the home state has sufficient control over the foreign territory and the individuals on this territory. Exactions committed by private military company on a territory and during operations controlled by the home state. Stéphanie Lagoutte, Senior Researcher, DIHR 38
39 Challenge 2: Extraterritoriality (4) Some human rights treaty bodies recommend that home states take steps to prevent abuse abroad by business enterprises within their jurisdiction. States may adopt domestic measures which set out clearly the expectation that businesses respect human rights abroad. Extraterritorial human rights application is often confused with other form of extraterritorial jurisdiction. Stéphanie Lagoutte, Senior Researcher, DIHR 39
40 Challenge 2: Extraterritoriality (5) Extraterritorial legislation in specific areas (for instance: US Foreign Corrupt Practice Act of 1977; UK Bribery Act of 2010 or US Dodd-Franck Act of 2010, Section 1502 on conflict free minerals (consumer protection ). Extend criminal responsibility to allow for prosecutions based on the nationality of the perpetrator (physical or legal person) no matter where the offence occurs as this is the case (domestic law / Rome Statute). Extend Civil liability regimes (torts) in order for victims of human rights-related abuses outside the territory of the state to obtain remedy in the form of damages from the companies that have perpetrated or are complicit of the abuses. Stéphanie Lagoutte, Senior Researcher, DIHR 40
41 Other debates and challenges: Liability of business enterprises re. international crimes Corporate complicity in State HR violations Role of soft law in international human rights law: commitment and compliance + Conflict-affected areas + Specific situation of vulnerable groups and individuals, especially indigenous people and landgrabbing Stéphanie Lagoutte, Senior Researcher, DIHR 41
42 Role of the UNWG on HR & B (1) Dissemination and implementation of the UNGPs Identify, exchange and promote good practices and lessons learned Promote capacity-building and development of domestic legislation and policies Country visits Explore options and make recommendations at the national, regional and international levels for enhancing access to effective remedies Gender perspective and focus on vulnerable situations, in particular children Stéphanie Lagoutte, Senior Researcher, DIHR 42
43 Role of the UNWG on HR & B (2) Cooperation and coordination with other relevant special procedures of the HRC, relevant United Nations and other international bodies and regional human rights organizations dialogue and discussions on possible areas of cooperation with Governments Guide the work of the Forum on Business and Human Rights; Report annually to the Human Rights Council and the General Assembly. Stéphanie Lagoutte, Senior Researcher, DIHR 43
44 Websites UN Working Group on the issue of human rights and transnational corporations and other business enterprises ansnationalcorporationsandotherbusiness.aspx Danish Institute for Human Rights Human Rights and Business ess Business and Human Rights Resource Centre (London) Stéphanie Lagoutte, Senior Researcher, DIHR 44
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