With the development of corporate responsibility (CR) worldwide has come greater regulation and legislation of business behaviour. France and Denmark require major firms to report on their sustainability performance, Indonesian law requires companies to allocate budgets for CR programmes, and countries such as Nigeria and the Philippines are contemplating CR regulation.
Unfortunately, most of this legislation still focuses solely on reporting or community investment, and often fails to prevent or sanction the most intolerable corporate abuses. In the case of Peru, new legislation is even increasing the risk of human rights violations, by granting companies the freedom to extract Amazonian resources without prior consultation with local indigenous communities.
Faced with the relative inefficiency of voluntary business codes and the lack of global human rights enforcement mechanisms, a new consensus is emerging to hold companies legally accountable for their human rights abuses, both in their home countries and abroad. John Ruggie, the UN Secretary General’s special representative on business and human rights, has played a key role in building up this consensus by developing a framework based on three pillars: states have a duty to protect human rights; business is obliged to respect human rights; and victims have a right to access remedy.
Recent news shows the relevance of this framework in today’s business ethics. In the Netherlands, the Dutch judicial system has recently ruled that it had the authority to handle a case over Shell’s social and environmental impacts in Nigeria. In the UK, the Joint Committee on Human Rights has published a report calling on the government to regulate UK businesses’ human rights practices abroad, which has been warmly welcomed by human rights advocates.
While the implementation of such legislation is uncertain in the near future, businesses should bear in mind that stakeholders are progressively moving beyond mere scrutiny, and raising the bar for business’ role protecting human rights.
Key proposals to step up the fight against corruption
To mark the International Anti-Corruption Day on December 8, leading experts brought together by the World Economic Forum developed proposals to help tackle corruption. Their report ‘Raising Our Game: Next Steps for Business, Government and Civil Society to Fight Corruption’ recommends that businesses empower ethics officers to prevent bribery through anti-corruption programmes, such as the Partnering Against Corruption Initiative (PACI). The report also called for governments to create a level playing field by ratifying and fully implementing the United Nations Convention Against Corruption into national law. The estimated cost of corruption worldwide is more than 5% of global GDP with over $1 trillion lost in bribes each year.
Amnesty calls for Peru to suspend oil companies working on indigenous land
Amnesty International (AI) is ‘urgently’ pressing the Peruvian government to suspend companies whose work could affect the rights of indigenous people. AI makes the recommendation in a new report, ‘Peru: Bagua, six months on’, published on December 12, six months after armed police attacked a peaceful indigenous protest in northern Peru.
AI’s call comes after the government has granted more than 70% of the Peruvian Amazon to oil and gas companies, and has announced plans to increase that figure early in 2010. It echoes a recommendation made by the United Nations earlier this year when it told Peru it should not allow oil and gas drilling on indigenous peoples’ land without their ‘informed consent’. Companies potentially affected include those working on land inhabited by uncontacted tribes, such as Perenco and Repsol-YPF.
Audi and Microsoft amongst those slammed for greenwashing
Consumers International, a global consumer watchdog group, has named Audi, easyjet, BP, CO2isgreen and Microsoft as winners of the international Bad Company Awards 2009. Consumers International asserted that people around the globe have a ‘right to true and trusted information about the environmental impact of products and services,’ and condemned the companies highlighted by the Awards for ‘dubious corporate green claims’. Audi was slammed for implying that driving a car could be as green as riding a bicycle, whilst BP was condemned for claiming to care about greenhouse gas emission while, according to CI, ‘dropping its investment in renewable energy’. Easyjet’s continued claims that flying on one of its planes was less damaging to the planet that driving a hybrid car were also slated, as was Microsoft for highlighting the small energy savings associated with its new Windows 7 operating system, while suggesting that customers buy a new computer to run it on.
Big businesses fail to protect the rights of workers in their global supply chains
EIRIS’ latest research, released on December 17, identified corporate breaches of the International Labour Organisation’s (ILO) conventions on child labour, forced labour, trade union rights and equal opportunities in the supply chains of some of the world’s biggest companies. Based on EIRIS’ Convention Watch research, the report ‘A Risky Business? Managing core labour standards in company supply chains’ finds that 45% of companies analysed have no policy or management systems in place to protect labour standards in their supply chain and fail to report on the issue. The consumer industry demonstrates the most advanced response to human rights breaches, and is also the most likely to have been accused of such breaches and to respond to such allegations. Two consumer industry case studies of supply chain allegations are examined in the report, in relation to Gap and Primark. Products which have the greatest risk of poor labour standards associated with their manufacture include clothing, footwear, toys, consumer electronic items and some agricultural products
Global Witness urges government to act on human rights report
On December 16, Global Witness welcomed a report from the Joint Committee on Human Rights (JCHR) and called on the UK government to heed the recommendations and do more to prevent UK companies operating overseas from being complicit in human rights abuses. The report, ‘Any of our business? Human rights and the UK private sector’, lists several companies operating in conflict areas as being involved in grave human rights abuses. These include Afrimex and Amalgamated Metals Corporation (AMC), companies which trade in minerals from the Democratic Republic of Congo (DRC), about which Global Witness gave written and verbal submissions to the committee. The report’s found that there was an undue reliance on voluntary standards, which are often not enforced, and said that greater emphasis should be placed on legislative remedies.
Recession is the catalyst for a decade of business change
According to a CBI report released recently, the recession has raised concerns about commercial models, supply chains and finance that will reshape business behaviour well into the next decade. The CBI report, ‘The Shape of Business – The Next 10 Years’, flags four key areas of UK business where fresh approaches will develop because of the downturn. The first area is credit, as firms look to alternatives to debt-driven growth to protect investment and innovation. Secondly, the report finds that companies will reorganise and re-examine their approach to working with partners – from suppliers to universities, and even competitors. Thirdly, CBI outline how sustainability and ethics will become more integrated into the business model as firms seek to improve accountability and corporate citizenship to attract and retain customers and staff. Finally, a more flexible workforce will evolve, assisted by developments in technology and training. For some firms that might mean a smaller core workforce and a larger ‘flexiforce’.
New online forum for UN Business & Human Rights mandate
On December 1, the United Nations Special Representative of the Secretary-General (SRSG) on business and human rights, John Ruggie, launched a global online forum. The purpose of the forum is to gather input for the SRSG as he develops guiding principles to operationalize the UN ‘Protect, Respect, Remedy’ framework, as requested by the Human Rights Council. The UN ‘Protect, Respect, Remedy’ framework is made up of three pillars: the State duty to protect against human rights abuses by third parties, including business; the corporate responsibility to respect human rights, which means to avoid infringing on the rights of others; and greater access by victims to effective remedy, judicial and non-judicial.
Contact: United Nations Special Representative of the Secretary-General on business & human rights
Businesses must address role in human rights abuses
The Institute for Human Rights and Business (IHRB) launched its Top 10 list of emerging business and human rights challenges for 2010 to mark International Human Rights Day on December 10. ‘This is a call to raise corporate standards and strengthen public policy to ensure that the activities of companies do not contribute to human rights abuses,’ said John Morrison, IHRB Executive Director. Mary Robinson, former UN High Commissioner for Human Rights and Chair of IHRB’s Advisory Board said, ‘New incentives are needed to improve transparency, learning and quality assurance across much of the work aimed at supporting business in acting responsibly.’
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