The Business of Human Rights

Best Practice and the UN Guiding Principles

Alex Newton

• Publisher: Routledge
• Year: 2019
• Print ISBN: 9781783537150
• eBook ISBN: 9781351131179
• Topic: Business
• Subtopic: Business Ethics
• Index: Business

The spotlight of global scrutiny has shone particularly brightly on corporations' adverse impacts on human rights in recent years. Corporations make up more than two-thirds of the world's top economies today, and so rightly they are being called to account for their impacts on society and the communities in which they operate. The Business of Human Rights demystifies the relevance of human rights for business, explaining how the corporate responsibility to respect human rights under the UN Guiding Principles can be implemented in practice. It provides a straightforward, practical guide that can be easily read and interpreted by managers to help businesses navigate this complex area of legislation and "soft" law to fulfil their responsibilities. It explains the potential legal, financial and reputational implications for corporations and the steps they need to take to address them.

The book tracks some of the major global developments in business and human rights, including the emergence of foreign, transnational, and international law and the proliferation of multi-stakeholder initiatives on business and human rights. Case studies from a range of sectors and industries – such as extractives, apparel, fast-moving consumer goods, electronics, and banking and finance – illustrate the enormous risks and opportunities human rights pose for business in practice.

The Business of Human Rights will equip corporate executives, sustainability practitioners, academics, students, and anyone interested in business's impacts on society with the essential information and tools they need to quickly come up to speed with the rapidly evolving area of business and human rights.

Part I

Introduction

Chapter 1

What is business and human rights?

Human rights

Before we address the topic of business and human rights, it is necessary to take a step back to first consider the concept of human rights itself.

While the term “human rights” is frequently bandied about in daily discourse, its content and meaning are not always fully understood. In essence, human rights are the universal rights and freedoms that apply to everyone, irrespective of their gender, race, religion, or country of origin. They aim to secure dignity and equality for all people.

At the international level, human rights are enshrined in international treaties. At the national level, many countries have implemented their international human rights obligations in domestic legislation. For other countries, their international obligations are “automatically” incorporated in their domestic law when they sign and ratify an international treaty.

The 1948 Universal Declaration of Human Rights (“UDHR”) is considered the cornerstone of the international human rights system. It was drafted in the aftermath of the Second World War to prevent a recurrence of the atrocities in the war.

The UDHR recognises all the main human rights, including civil and political rights (like the rights to life, to free speech, to a fair trial, and to freedom from torture and slavery) and economic and social rights (such as the rights to health, to social security, to education, to a fair wage, and to favourable working conditions).

The UDHR was codified into international law through two 1966 treaties: the International Covenant on Civil and Political Rights (“ICCPR”)¹ and the International Covenant on Economic, Social and Cultural Rights (“ICESCR”).² Together, these three documents form the International Bill of Rights. We underline its importance from the outset and will return to it throughout this book.

Aside from the International Bill of Rights, there are various treaties that are notable for specifically addressing the rights of certain groups of people. Among others, these include: women (Convention on the Elimination of All Forms of Discrimination Against Women), people with disabilities (Convention on the Rights of Persons with Disabilities), children (Convention on the Rights of the Child), and refugees (Convention Relating to the Status of Refugees).

Since it was established, the international human rights law framework has principally governed nation States, not individuals or corporate actors. Under the framework, States have obligations to respect, protect, promote and fulfil human rights. (An exception to this is the obligations that corporations and individuals owe under international criminal law. This will be discussed further in Chapter 6.)

In turn, it has been the role of nation States to regulate corporate actors’ behaviour within their territory or jurisdiction to the extent that it impacts detrimentally on human rights. States meet these obligations in a range of ways, including by enacting and enforcing domestic legislation, providing judicial remedies, and imposing regulations and reporting requirements on business.

This division between States’ and corporations’ responsibilities works well in theory. However, it has often broken down in practice as the tentacles of transnational corporations’ supply chains have spread out further and further, entangling many more suppliers and contractors in far-flung places, and across multiple jurisdictions, in their path. Gaps have emerged where no State is either willing or able to regulate corporations’ behaviour when it comes to human rights.

These “gaps” in governance between the international and national human rights law systems when it comes to governing corporate conduct underpin the genesis of the business and human rights movement.

Business and human rights

As global supply chains have become increasingly complex and attenuated, and as corporations have entered more and more emerging markets, transitional democracies, and those in conflict or post-conflict situations, the deficiencies of many States’ abilities to regulate the human rights impacts of business have become apparent.

Often the host country (that is, the country where a multinational corporation is operating) may not have sufficient protections in place safeguarding human rights. Accordingly, when adverse impacts result from a corporation’s activities in that country, the legal mechanisms under which victims might seek redress are either inadequate or non-existent.

Even where appropriate laws and regulations are in place, in many cases the public institutions responsible for law enforcement in the host country may be unwilling or unable to enforce them. There are myriad reasons for this, including corruption, nepotism, or institutional weakness or failure. In addition, there may simply be a reticence to impose harsh penalties and judgements on a foreign corporation out of the fear that it – and others like it – will take its lucrative and much-needed investment in the economy elsewhere.

Meanwhile, in the home country (that is, the corporation’s country of origin), there is often a reluctance to exercise extraterritorial jurisdiction over the activities of its corporations operating in far-flung corners of the world. Again, there are several reasons for this. They include the practical difficulties of locating evidence and witnesses in a foreign country to prosecute a case against the corporation concerned. As a result, the home country will often defer to the host country’s laws and procedures, even where these may be inadequate.

These profound gaps in governance have meant that, in many instances, neither the home nor the host country has provided redress for victims affected by corporate violations of human rights. It is against this backdrop that the business and human rights field took root and eventually blossomed into what it is today.

Most saliently, business and human rights came to global prominence in June 2011 when the United Nations’ Human Rights Council unanimously endorsed Harvard Professor John Ruggie’s Guiding Principles on Transnational Business and Human Rights (Guiding Principles).³

The Guiding Principles are significant as they represent two firsts:

1 they are the first authoritative guidance that the UN Human Rights Council, or its predecessor, the Human Rights Commission, has ever issued on business and human rights; and

2 it was the first time that the Human Rights Council had ever endorsed any normative document, on any subject, that governments had not negotiated themselves.⁴

There are 31 Guiding Principles. They outline how States can meet their duty to protect human rights, and how corporations can meet their responsibility to respect human rights.

The Guiding Principles are underpinned by the “Protect, Respect and Remedy” Framework (the Framework),⁵ also developed by Professor Ruggie. The Framework comprises three pillars:

1 the State duty to protect against human rights abuses by third parties – including business enterprises – through appropriate policies, regulation and adjudication;

2 the corporate responsibility to respect human rights, which means that business enterprises should act with due diligence to avoid infringing on the rights of others and to address the adverse impacts with which they are involved; and

3 the need for victims to have greater access to effective remedy, both judicial and non-judicial, including State-based and non-State-based mechanisms.

The Guiding Principles and the Framework are discussed in greater detail throughout this book. Both are central to a proper understanding of the business and human rights area.

While the Guiding Principles’ endorsement is seen by many as the high watermark of business and human rights, it is important to underscore that business and human rights issues have existed in one form or another for decades, indeed for as long as business has interacted with, and impacted on, society. Its precursors in the corporate social responsibility field and within the United Nations system will be outlined to place recent developments in context.

Notes

1 International Covenant on Civil and Political Rights, Dec. 16, 1966, S. Treaty Doc. No. 95–20, 6 I.L.M. 368 (1967), 999 U.N.T.S. 171.

2 International Covenant on Economic, Social and Cultural Rights, Dec. 16, 1966, S. Treaty Doc. No. 95–19, 6 I.L.M. 360 (1967), 993 U.N.T.S. 3.

3 Guiding Principles on Business and Human Rights: Implementing the United Nations’ “Protect, Respect and Remedy” Framework, A/HRC/ 17/31: 21 March 2011.

4 Ruggie, J. “Opening statement at the First Annual UN Forum on Business and Human Rights,” Geneva, 3–5 December 2012. Accessed on 9 March 2018: www.ohchr.org/EN/Issues/Business/Forum/Pages/2012ForumonBusinessandHumanRights.aspx.

5 Ruggie, J. “Protect, respect and remedy: a Framework for Business and Human Rights,” A/HRC/8/5: 7 April 2008.

Chapter 2

How this book is structured

Human rights are a compelling issue for all businesses to consider, irrespective of their size, sector, location, ownership, or structure. Despite this, the human rights risks faced by any one corporation will vary greatly depending on the complexity of its supply chain, the country or countries in which it operates, and the nature of its industry, among many other factors.

To set the scene for the discussion that follows, Part II of this book examines the evolving social and economic context in which business’s detrimental impacts on human rights have occurred. This has been impacted by various interconnecting phenomena including (among others) the globalisation of markets; increasingly complex and disparate supply chains; and governance gaps in many emerging nations where multinational corporations are operating.

Part II also clarifies some of the similarities and differences between the area of business and human rights and corporate...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• List of illustrations
• Acknowledgements
• About the author
• How this book came about
• PART I: Introduction
• PART II: Business and human rights in context
• PART III: The implications of human rights for business
• PART IV: Getting started – what actions should a company take?
• PART V: Human rights snapshots from different sectors
• PART VI: Conclusion
• Index