Value chain mapping and traceability are common buzzwords in sustainability circles. But few companies are looking beyond a limited number of commodities or deliberately applying an explicit human rights lens to these processes. From my experience at Shift, working with dozens of companies, human rights value chain mapping is one of the most effective ways to fully understand the expectations of the UN Guiding Principles on Business and Human Rights, and to drive action on the most severe human rights challenges a company faces.
Why should a company map its value chain?
Companies are expected to meet their
responsibility to respect human rights. Value chain mapping helps
companies realize that expectation, by building an understanding of the
full scope of impacts, prioritizing the most severe human rights issues,
and identifying other actors that have a role to play in exercising
leverage to address these issues.
Value chain mapping can help explain a
fundamental shift that the UNGPs reflect: the expectation that a company
proactively identifies and addresses potential human rights impacts across its entire value chain, rather
than just in its own operations and immediate contractual
relationships. HEINEKEN, one of the companies we work with, calls this
approach to identifying impacts “from barley to bar.”
In the work we do with them at the country level, the first step is to
draw a full map of the risks to people across the local operating
company’s operations and value chain. This includes the human rights
risks to smallholder farmers (often several steps removed
from HEINEKEN’s operations), as well as those relating to the brand
promoters in outlets serving its beers.
The objective of value chain mapping is very practical — to take action on the most severe human risks a company is involved with.
Value chain mapping is the process to
create a visual representation of the different entities in the value
chain to which the company is connected through its products and
services. The process maps each step in the chain (including the type
and number of entities in a particular step, and often their geography),
and identifies where people’s human rights can be impacted. This helps
visualize how the company can be involved with particular human rights
risks.
Value chain mapping should also identify
existing internal processes and external mechanisms to address human
rights risks. These mappings help uncover blind spots in both areas of
human rights risks and management systems to address them and identify
areas where further information gathering is needed, making it a
valuable risk management tool.
How can companies use value chain mapping?
It’s all about action! The objective of
value chain mapping is very practical — to take action on the most
severe human risks a company is involved with. While the UNGPs expand
the scope of where companies should look for human rights risks, value
chain mapping makes it easier to focus on the most severe issues, even
if they are farther away and less well-understood than the
more immediate issues the company may already know about. The mapping
also shows how the company is connected to an impact, and who needs to
be involved in addressing it—whether that is a particular supplier or
contractor, or a specific company function or business unit.
Once the map is sufficiently detailed, it enables brainstorming and
informed discussion about where leverage exists or can be built, and how
it can be most effectively applied to address impacts (e.g., the pinch
point in the graph above).
Use it as a tool to get to (or accelerate) action: value chain mapping is not just helpful in driving technical analysis; it also creates an understanding of the company’s responsibility under the UNGPs, facilitates brainstorming on action areas and builds consensus around priorities.
Apply it iteratively: it is most effective to build step by step, without trying to perfect it. Regular updates should be made as more information is added.
Avoid paralysis by analysis: it is easy to get bogged down in the details. At every step, ask yourself the question: how does this piece of information lead us to more understanding, consensus, and action?
Consider how it informs your current due diligence: often, value chain mapping demonstrates how the company’s current approach differs from what the UNGPs expect. Insights from the mapping exercise provide valuable lessons for how to update the company’s overall approach to social sustainability to incorporate respect for human rights (see the experience of ABN AMRO below).
ABN AMRO: An Example of Effective Mapping
One of the first companies we worked on value chain mapping with was ABN AMRO, with an initial focus on the diamond value chain. We followed six steps in the mapping:
Identified the different steps of the diamond value chain and main countries of activity.
Identified the entities, their nature and size.
Mapped how ABN AMRO serviced clients in different parts of the value chain.
Investigated in which parts of the value chain the most severe impacts could be found.
Overlaid the map with existing due diligence efforts by the bank as well as relevant external mechanisms (e.g., Kimberley Process).
Identified the residual risks, and where ABN AMRO could best apply leverage to address them.
The analysis formed the basis for
engagement with account managers, desk heads, sustainability experts,
the bank’s leaders, clients, other companies and external stakeholders.
This led to the following actions by ABN AMRO:
They issued a client briefing on responsible jewelry, offering additional value for clients by providing information and analysis.
They commissioned and published a study on the “true price” of diamonds.
They enhanced due diligence to add a focus on client subcontractors, which was identified as an additional area of risk.
They started to explore the wider application of leverage in the sector beyond their immediate clients by engaging other parties with leverage (e.g., major mining companies) and sector initiatives, such as the Responsible Jewelry Council.
It spurred the commitment of banks, the Dutch government, unions, and NGOs to jointly conduct sector-level value chain mappings under the umbrella of the Dutch Banking Sector Agreement on Human Rights.
In addition to these specific actions,
the diamond mapping (as well as subsequent mappings of other
commodities) have contributed to a more fundamental reflection on ABN
AMRO’s approach to human rights due diligence, and an explicit
recognition that addressing human rights issues must focus on continuous
improvement and the creative use of leverage, not a tick-box,
compliance approach.
These remarks were originally
delivered by Shift’s President Caroline Rees at the Expert Conference on
Sustainable Supply Chains on February 21st, 2019 in Berlin.
I’m grateful for the invitation to join
you today for a conversation that is both important and timely, looking
at the distinct roles and responsibilities of business and governments
when it comes to sustainable supply chains, and the rights-respecting
business practices on which they depend.
In sharing with you a few reflections
this morning, I’d like to start by taking us back briefly to the reason
why it was, and is, so important to understand the distinct roles of
business and government; and to remind us why this conversation has
never been more central to the challenges of our time.
And then I’ll share with you a few
reflections about what the UN Guiding Principles on Business and Human
Rights mean when they call for a ‘smart mix’ of government measures, and
what that might imply for your own deliberations here in Germany.
First, let me take us back a few years.
Before John Ruggie’s mandate was created, I was representing the UK Government at the then UN Commission on Human Rights – just before it became today’s Human Rights Council.
That was 2004, and the idea that companies have a responsibility with regard to people’s human rights was hotly disputed.
Many in the business arena felt that claims of such a responsibility
were merely an excuse to push onto business the obligations of states.
And many in civil society saw a conveyer belt of severe business
impacts on people that were treated as if business had no responsibility
at all.
Little surprise that discussions were heated!
And little surprise that as we
negotiated the mandate for a new role of Special Representative of the
UN Secretary-General on Business and Human Rights – which Kofi Annan
then invited John Ruggie to take on – the task of identifying the
distinct roles and responsibilities of governments and business was
front and center.
Fast forward to 2011, and of course the UN Human Rights Council endorsed the UN Guiding Principles on Business and Human Rights that John had developed over six years of research and consultation, and which were built on three distinct pillars:
The duty of states to protect human rights against abuse by third parties, including business;
The responsibility of business to respect human rights
– meaning to avoid infringing on people’s human rights through their
operations and value chains, and address any impacts that do;
And the need for anyone whose human rights are harmed by business to have access to remedy through effective judicial and non-judicial mechanisms – which reflects responsibilities of both states and business.
Let me highlight two critical points from the UN Guiding Principles:
First, the corporate responsibility to respect human rights
is not an optional extra, or a sign-up proposition – it is a baseline
expectation for all companies, everywhere. This is no longer about voluntarism.
Second, the responsibility of business does not increase or decrease depending on what governments do.
It remains the same. But it is considerably harder to implement the
responsibility to respect human rights where governments fail to meet
their own duties.
That brings us to the heart of our
discussion today: what can and should governments do? What constitutes
what the Guiding Principles call a ‘smart mix’ of measures on the part
of governments in meeting their own duty to protect?
Before I say more about the idea of a
‘smart mix’, it’s important to understand this conversation about
business and human rights in context.
Because of the way the discussion on
business and human rights emerged onto the international stage, it can
sometimes appear to be a bit of a niche topic, a side-show, or perhaps a
small sub-set of what the investment arena refers to as ‘ESG’ –
environmental, social and governance factors.
The question of business respect for human rights lies at the heart of one of the most pressing challenges of our time: gross inequality.
It is none of the above. Quite the
opposite: the question of business respect for human rights lies at the
heart of one of the most pressing challenges of our time: gross
inequality. As such, it needs to be approached with the same
seriousness, attention and resources as is the role of business impacts
on the environment in the context of our other most pressing challenge:
climate change.
Let me pause on that for a moment.
A critical turning point in the
discussion of climate change and the role of business came when climate
change was understood as a tragedy of the commons.
What does that mean?
It means that we realized our planet and the environment it provides
us with is a precious shared resource system on which we all depend;
and if companies and others draw down on this resource individually
for their own narrow self-interest, collectively they erode the very
resource on which we all – business included – depend.
There is an analogous kind of tragedy of
the commons in the gross inequalities that now characterize societies
in so many countries – including developed and emerging market economies
– and the backlash against globalization that this has engendered.
Why is this a tragedy of the commons?
Well, we have another shared resource
system on which we all depend to survive and thrive – namely, social
cohesion and stability.
This relies in good part on advancing
human dignity, equality, hope and opportunity: the sense that people of
all backgrounds can better their lot and build a brighter future for
their children.
Yet business practices have too often
drawn down on human welfare for narrow, profit-focused self-interest,
squeezing out dignity and opportunity for so many in a process of
globalization that has failed to protect the most vulnerable in our
societies.
We have seen this in moves to seek out
ever lower-paid workers around the world, in land acquisitions and
permits that have dispossessed rural communities without consultation or
due compensation, in the over-excited embrace of a gig economy that
commoditizes people’s labor and the exploitation of people’s data that
commoditizes their very identities.
And so social cohesion and stability –
this shared resource system – has been gradually depleted, to the point
where the resulting tensions and anger – exploited by some for political
ends – tear our societies apart and make obvious what we should have
known all along: that ultimately, we all lose.
This is the story of business and human rights.
And this is why it is no side show, but must be center stage in any search for solutions to the challenges of our time.
As with climate change, it reinforces
why we need urgent action by both business and government – separately
and collaboratively with each other and with civil society – to address
gross inequalities and the human rights impacts that cause and result
from them.
When the Guiding Principles speak about the need for governments to adopt a ‘smart mix’ of measures, the word ‘mix’ should be understood to be as important as the word ‘smart’.
The commentary to UN Guiding Principle 3
states that, “States should not assume that businesses invariably
prefer, or benefit from, State inaction, and they should consider a
smart mix of measures – national and international, mandatory and
voluntary – to foster business respect for human rights.
As we explore today what we might, from
all our different perspectives, consider more or less ‘smart’ measures,
let’s not forget that this is equally about a ‘mix’: comprising
measures across all those categories of ‘national and international’ and
‘mandatory and voluntary’.
Let’s consider five distinct kinds of role that governments can take as part of a smart mix, all of which are covered in the UNGPs. They include:
policies and exhortation,
guidance and support,
integration in government’s own transactions with business,
legislation or regulation, and
ensuring access to remedy.
As we look at each of these measures, we see why a smart mix is essential, as no one of them can be effective without some or all of the others.
First, there is the role of policies and exhortation.
UN Guiding Principle 2 makes clear that ‘States should set out clearly
the expectation that all business enterprises domiciled in their
territory and/or jurisdiction respect human rights throughout their
operations.’
This requires a clear and unambiguous assertion of what the government expects of business – right across their value chain. It should provide predictability and be coherent across all parts of the government.
But a statement of expectation is quickly undermined if it is unsupported by other interventions.
For example, if the government does not scrutinize whether the
companies it procures from, or to which it gives trade support, have
identified and addressed human rights risks, it will be quickly assumed
by businesses that they are not truly expected to do the same themselves.
In sum, government policy that is undermined by government practices quickly becomes a non-policy.
Second, is the role of government in providing support and guidance to companies.
We must be honest and clear-eyed in recognizing that implementation of
respect for human rights is not straightforward. It take considerable
time, commitment and effort. And the job is never done.
So government has a critical role to play in assisting companies in
making progress – including through advice at home and through overseas
missions, and through guidance, resources and other forms of support.
For example:
The UK Equality and Human Rights Commission issued guidance to company boards on respect for human rights.
A number of governments have played a critical role in initiating
and chairing the Voluntary Principles on Security and Human Rights – a
key international initiative including both business and civil society
members.
The Dutch government commissioned an independent evaluation of human
rights risks in the global supply chains of 13 sectors and has
supported the development of binding agreements among stakeholders in
those sectors.
Yet guidance is just that – a resource one may choose to use. Those companies that do not see a need to make progress can and will ignore it.
Progress will be limited if no evidence is required that indeed progress is being made.
So again, we must think of other measures as well.
Raising expectations and demands alone is inadequate to help business on the journey of implementation.
Third is the role of government when it does business with business. The UNGPs call this the ‘state-business nexus’ and refer explicitly to activities such as procurement and the provision of export credit guarantees, investment insurance, development aid and development finance, as well as government actions in ownership or control of state-owned enterprises.
The Norwegian export credit agency has long shown leadership in its
own human rights due diligence on clients and in action that has
leveraged positive change, and the agencies of Denmark, Sweden, the
Netherlands and Canada are also stepping up to their role in this
regard.
The Finnish Government has perhaps shown unique coherence in
bringing together all five of its public finance instruments to evolve
their own implementation of human rights due diligence collectively and
in coordination.
The US Federal Acquisition Regulation, which governs public
procurement in the US, prohibits child labor, forced labor and human
trafficking, and various Executive Orders have further expanded specific
human rights protections in the procurement context.
Yet this kind of action by governments when they do business with business also requires support from other measures. Raising expectations and demands alone is inadequate to help business on the journey of implementation.
The UK’s Development Finance Institution has developed due diligence
guidance and practical training for fund managers in the private equity
firms it invests in in high-risk markets.
And the US General Services Administration also makes guidance to
procurement officers in government public to assist them and their
suppliers in meeting expectations.
Fourth comes the role of legislationand regulation.
Of course, legislation has always been a feature of business and human
rights, even when not labeled as such. Typical examples include laws on
health and safety, consumer protection, non-discrimination in the work
place, freedom of association and data privacy.
We have seen a range of legislative
initiatives in recent years, including on child labor and modern slavery
in supply chains, on conflict minerals in supply chains, and on human
rights reporting in the context of wider non-financial reporting
Recently, of course, we have seen a
groundswell of support in various European states for mandatory human
rights due diligence legislation.
The French Duty of Vigilance law was a first example and will be discussed further today.
The popular initiative that is under discussion in the Swiss legislature warrants close attention as showing some very thoughtful balances in requiring that companies demonstrate the adequacy of their due diligence when complaints are raised, but also allowing that where companies do so, this can also be a defense against liability.
The 2016 revisions to the US Tariff Act of 1930 takes a similar approach to requiring the demonstration of adequate due diligence, in the specific case of forced labor.
Anyone who has reason to believe that products produced by forced labor are being or likely to be imported to the US may report this to Customs and Border Protection for investigation.
Products can then be withheld until documentation of due diligence for forced labor is provided by the company. A list of products being withheld or released is made public.
Let me highlight three of the benefits we see that can flow from robust and workable human rights due diligence legislation:
It can elevate the examination of human rights risk to senior levels of the company and the board, as well as mainstreaming it into business functions that otherwise too often see it as a diversion and distraction;
It can level the playing field for companies. This
helps ensure that it is not only those companies with brand names or
other forms of public exposure that are pressured to improve. It also
avoids the current danger that companies that are de facto leaders are
more critiqued than those who may have done little or nothing but manage
to fly below the radar of attention.
It can provide a means for people who have been harmed by business activities to find an avenue for remedy,
where it includes civil liability for companies. Since these are often
the most vulnerable people in societies around the world, the importance
of these all-too-rare means for them to access remedy cannot be
overstated.
Of course, legislation can also be
poorly crafted. That leads not just to inefficiencies and frustration,
but can also have perverse consequences – including for human rights.
Let me highlight three particular risks.
Respect for human rights is not simply a compliance proposition. It fails if and when it is treated as such.
First, the desire for clarity can quickly lead to a tick-box, compliance-led approach to the drafting of legislation.
But respect for human rights is not simply a compliance proposition. It fails if and when it is treated as such.
Rather, it is a way of thinking about business decisions and action,
a way of considering the implications of what the company does for
people inside and outside the company.
Respect for human rights is fundamentally about culture and
behavior. And for that, tick-box lists and mechanical approaches are
insufficient.
But we can look to various other fields, from health and safety to
consumer protection to find lessons in how to avoid this pitfall.
That raises a second point, which is that it is important to strike a careful balance in how precisely laws prescribe what is asked of companies.
Laws that are too prescriptive risk being inappropriate to the actual operating realities of many companies, and can distort practices in unhelpful ways.
On the other hand, laws that are too general can end up being interpreted in ways that easily disregard their actual intent.
This again reminds us of the importance of other measures to
complement legal provisions, which will always be constrained to a
certain level of generality. Their intent can be reinforced, for
example, through implementing regulations, government guidance, or
complaints mechanisms and access to remedy.
That brings me to my third point. That is, that
great care must be taken to understand and preserve the distinctions
between the actual scope of companies’ responsibility to respect human
rights and the reasonable scope of any civil liabilityprovisions that legislation may introduce.
The UNGPs make clear that companies have a responsibility not only
where they cause or contribute to a human rights harm, but also where
abuses are linked directly to their products and services – including at
remote tiers of their value chain – without any contribution on their
part.
Legislative proposals that aim to include civil liability provisions
need a narrower scope. It would be unreasonable to attach liability to
scenarios where the company has not contributed to a harm.
Yet laws should not imply that an absence of civil liability means an absence of responsibility.
One way to address this distinction could be to require reporting by
companies on the full scope of their responsibility, while constraining
any civil liability provisions to situations where the company’s own
actions or decisions have played a role.
Enabling remedy is one of the most compelling arguments for considering civil liability in the context of legislation on human rights due diligence.
The fifth and final role of governments in this ‘smart mix’ is of course in providing access to remedy. This would warrant a separate discussion all of its own given the central importance for human rights of ensuring that people whose human rights are harmed can seek and secure remedy for those harms.
Enabling remedy is one of the most compelling arguments for
considering civil liability in the context of legislation on human
rights due diligence.
National development finance institutions or export credit agencies
may also offer some form of recourse to raise concerns about decisions
that have been made to support certain businesses or investments. The
independent complaints mechanism for the German, Dutch and French DFIs
has initiated a mediation process in response to a complaint from
communities in the DRC about a land conflict with a local subsidiary of a
Canadian company.
Of course, the OECD National Contact Points may offer another
mechanism for remedy at the international level, with governments
intended to use their own leverage to bring companies and stakeholders
to the table to resolve complaints. Unfortunately, most NCPs have failed
to deliver on their promise so far. And they have almost never gone so
far as to provide remedy to those harmed, with the refreshing and
admirable exception in the case of Heineken working with the Dutch NCP
and civil society last year.
So let me leave you with these key reflections by way of summary.
Efforts to embed respect for human
rights into how business gets done are indispensable if we are to tackle
the gross inequalities that plague societies today, and the threats to
social cohesion and stability that are their ever more frequent result.
While the corporate responsibility to
respect human rights is not voluntary or optional; it is far harder to
implement where governments do not meet their own duties to protect
human rights.
A critical role of government – which can thread among and between these five categories – is collaboration.
When the Guiding Principles speak about
the need for governments to adopt a ‘smart mix’ of measures, the word
‘mix’ should be understood to be as important as the word ‘smart’.
There are five key types of measure that can make up such a mix:
policy measures, guidance and support, integration in governments’ own
transactions with business, legislation and regulation, and ensuring
access to remedy. Yet each of these types of measure is inadequate on
its own, and each is much stronger where most or all of the others are
present.
Finally, I would be remiss not to note
that a critical role of government – which can thread among and between
these five categories – is collaboration.
Here in Germany there is a strong
history of collaborative decision-making and consensus-building. This is
seen also with regard to business and human rights – whether through
your long history of social dialogue or through recent initiatives such
as the Textile Industry Roundtable.
I look forward to joining you in some
really collaborative thinking through the rest of the day as you explore
the options to bring your different roles and responsibilities
together, and start to define a smart mix of measures on the part of
government, with the common purpose of building sustainable global
supply chains based on rights-respecting business practices.
There is a growing number of national and international debates around mandatory measures to ensure business respect for human rights, and specifically a) a binding international instrument on business and human rights and b) national legislation on mandatory human rights due diligence. In these debates, the UN Guiding Principles’ expectation of a “smart mix” of implementation measures is often cited. As a contribution to these discussions, Shift has developed the following statement on the role of mandatory measures in a “smart mix”.
I
The State Duty to Protect is not a passive duty, but a proactive one.
Under UNGuiding Principle 1, all states “must protect against human rights abuse within their territory and/or jurisdiction by third parties, including business enterprises”. This “requires taking appropriate steps to prevent, investigate, punish and redress human rights abuse through effectivepolicies, legislation, regulations and adjudication”.
This should be understood as a proactive
duty. States should actively assess the effectiveness of what is
currently in place, understand what gaps there are, and identify ways to
address them. Yet most “National Action Plans” on the UNGPs to date
reflect a more passive approach; they are a catalogue of existing
measures rather than robust assessments of what more is needed.
II
The State Duty to Protect is fulfilled through a smart mix of measures.
To fulfill their duty to protect, states will need to use a range of approaches. The commentary to UN Guiding Principle 3 elaborates on this when it says that states “should consider a smart mix of measures – national and international, mandatory and voluntary – to foster business respect for human rights.” States should go beyond enforcing existing laws to “periodically assess the adequacy of such laws and address any gaps” in light of evolving circumstances.
III
A smart mix of measures necessarily involves legislative and regulatory measures.
A truly “smart mix” means looking at all four aspects (national,
international, mandatory and voluntary), not just the one or two that
are most convenient or already in place. It follows, therefore, that the
state duty to protect necessarily involves legislative and regulatory measures
at the national level, and the supportive infrastructure (such as
enforcement, incentives and guidance) needed to make them meaningful in
practice. Without these, the UNGPs will never fulfill their true
potential.
The UNGPs also clearly contemplate mandatory international measures as a natural part of this “smart mix”. Shift follows with interest the current discussion of a new treaty in this area.
IV
Measures that involve
Mandatory Human Rights Due Diligence are in line with the UNGPs, and
there are strong reasons for states to consider them.
Also Read
November 2019 | Publications
Let’s Talk Mandatory Measures: Supporting a Meaningful Discussion Among all Stakeholders
While the UNGPs do not demand that states adopt legislation requiring companies to carry out mandatory human rights due diligence (HRDD), clearly such legislation is entirely in line with the UNGPs.
Some elements of HRDD are already embedded in national laws, such as in health and safety regulations, environmental legislation, privacy laws or in some corporate reporting regimes. However, there are often strong reasons for states to also consider more comprehensive mandatory HRDD legislation.
In Shift’s experience, practical reasons to consider mandatory human rights due diligence can include:
The powerful effect it can have in driving top-level attention to human rights in companies, as well as engaging functions across the business;
Leveling the playing field across companies and sectors, including through engagement with business partners in a company’s value chain;
Obliging companies to consider the interests of stakeholders other than shareholders;
Incentivizing collaborative approaches to address systemic human rights risks; and
Enabling (where civil liability is included) a clear cause of action for individuals who are harmed to pursue remedy.
To be effective, such legislation should take account of critical aspects of the responsibility to respect. These include that:
It should not undermine the scope of the responsibility to respect, which extends throughout the value chain, even if liability is attached to a narrower set of relationships;
HRDD is a standard of conduct not result, meaning that mandatory measures should allow consideration of the quality of a company’s efforts to respect human rights; and
Meeting the responsibility to respect in practice will always involve going beyond compliance alone as good practice continues to evolve.
As a senior legal advisor to former UN Special Representative John Ruggie during his mandate, Shift’s Rachel Davis played a key role in the drafting process of the UN Guiding Principles on Business and Human Rights. Seven years into the implementation of the UNGPs, she reflects on the relevance of mandatory measures in the State Duty to Protect and the growing debate around comprehensive mandatory human rights due diligence legislation.
Pillar I of the UNGPs focuses on the role that states should play in fostering business respect for human rights. What is the role of mandatory measures in meeting that responsibility?
The UNGPs always envisaged that mandatory measures by states – at both the national and international levels – would be part of their implementation. It’s right up front in Guiding Principle 1, which says that states must have effective legislation and regulation, as well as policies and other measures, to protect against human rights harms by businesses. It’s also in the definition of the “smart mix” of measures that is needed under Guiding Principle 3 to meet the state duty in practice. Yet we often hear the term “smart mix” being used to really just mean voluntary measures. That’s a misreading of what the UNGPs say.
When we were developing the UNGPs, there were already relevant laws on the books in many states that made aspects of the corporate responsibility to respect human rights mandatory, like workplace health and safety legislation, environmental legislation, privacy protections and so forth. In the last few years, we’ve seen a growing number of legislative initiatives, including those aimed at introducing comprehensive human rights due diligence as a requirement for companies, helping to drive more effective implementation of the UNGPs.
So, does that mean that all states should implement comprehensive mandatory human rights due diligence legislation as part of a “smart mix” of measures?
A smart mix is exactly that – the right combination of mandatory, voluntary, national and international measures that is needed to effectively foster business respect for human rights in a particular context.
At the national level, that is going to look different in different countries, depending on what currently exists, how effective it is in practice, and what can be done to address the gaps. The UNGPs don’t require states to implement comprehensive mandatory human rights due diligence regimes, but as we explain in our statement on this topic, they are clearly in line with the UNGPs and there are positive reasons for states to consider them.
I think many stakeholders hoped that National Action Plans (NAPs) on the UNGPs would be a vehicle for states to proactively explore tailored mandatory measures. And it’s true that some NAP processes have provided important moments for governments to engage business and civil society stakeholders, bringing everyone around the table. But in terms of new measures, particularly mandatory measures, most NAPs have ended up just cataloguing what currently exists in a specific context, rather than identifying what more might be needed.
What about binding international measures? Do the UNGPs expect states to use those too?
Mandatory international measures are part of what the UNGPs mean by a smart mix. In my view, it’s only natural, and entirely predictable that the appropriate role of binding international measures should be actively considered as part of effective implementation of the UNGPs. Indeed, when John Ruggie presented the UNGPs to the Human Rights Council in 2011, one of his five follow-up recommendations specifically called for the development of a new international instrument. It was the only one that wasn’t taken up.
At Shift, we’re paying close attention to the discussion of the “Zero Draft” treaty. We are very interested in exploring how a binding instrument could drive the most meaningful change in state practice in this area.
Some laws have been criticized for incentivizing a tick-box approach by business to human rights risks. Don’t mandatory measures just lead to more compliance-based thinking that goes against how the UNGPs are trying to change company mindsets?
States have had to tackle this challenge in other areas of law that aim at changing company behavior like anti-corruption or health and safety, and there are plenty of lessons to learn from what has and hasn’t worked in those areas. It certainly requires up-front thought about who within the state is going to have the capacity and expertise to oversee the legislation, and assess whether its expectations are being met. Authoritatively calling out what meaningful compliance looks like, and what is merely superficial, is an important element in making such legislation effective in practice. And for it to be authoritative, the state needs to be playing a role in making these assessments.
Some have suggested that stringent laws can have perverse consequences, leading companies to avoid high-risk contexts, or to disengage rather than seek to influence high-risk suppliers, as a way to avoid liability. What is Shift’s perspective on this?
The UNGPs are trying to shift companies’ response to high-risk contexts or suppliers from one that seeks to manage risk to the business alone – by not investing in challenging contexts, or by immediately terminating relationships when human rights harms are found – to a more thoughtful approach that is driven by consideration of risk to people. This is why the quality of a company’s human rights due diligence matters. Legislative and regulatory regimes need to allow companies the space to show that they genuinely tried to use leverage creatively and consistently to address a situation. Legislation should also be designed to incentivize companies to put in place more robust internal processes for deciding to divest or withdraw from a relationship – processes that consider the severity of the impacts involved, and whether there could be additional harm to people from a decision to disengage.
Another specific risk that’s been raised is whether legislation could lead to companies reducing the scope of their human rights due diligence to the scope of their liability for impacts. Is this risk real?
The scope of due diligence expected under the UNGPs is likely to always be broader than the scope of legal liability for impacts a business is connected to. It’s true that the leading model of comprehensive mandatory human rights due diligence that has been enacted to date – the French Duty of Vigilance law – takes a narrower approach to the scope of due diligence, focusing it on those business relationships that could also give rise to liability. It will be very interesting to see whether companies limit their vigilance plans and their due diligence solely to the relationships covered under the Act, or whether they maintain a broader scope. We will be assessing how this plays out in practice against the baseline evaluation of French companies’ human rights reporting that we published last year.
The mandatory human rights due diligence proposal (or ‘popular initiative’) in Switzerland takes a different approach. It proposes that the scope of due diligence should be broad (throughout the value chain, as in the UNGPs) but that liability should only attach to harm caused by certain controlled entities like subsidiaries. We’ve been actively supporting the debate on the proposal in Switzerland for over 18 months now, through our engagement with both business and civil society partners and allies, and will continue to do so.
Are there specific elements that all states should consider when drafting legislation that includes aspects of mandatory human rights due diligence? Are there good practices – or issues to watch out for – that states could learn from?
Absolutely. We’ve already seen how important it is to provide clarity on key terms to ensure that they correspond to what businesses -and their stakeholders- are expected to do under the UNGPs. For example, don’t just use the term “supply chain”, which many companies may give a narrow meaning to, but clearly define it to include the full value chain connected to a company’s operations, products or services. We already see a difference in how the Australian Modern Slavery Act (MSA) handled this point, compared to the UK Act’s approach. In Australia, we had the benefit of learning from what hadn’t worked with the original MSA.
States will also want to consider how to avoid drafting legislation that facilitates action only at corporate headquarters and not at the operational or country level, or that creates perverse incentives for companies to avoid engaging publicly about human rights risks due to fears of liability. That’s not helpful for anybody.
This whole area concerning legislation as a part of a smart mix is one we’re going to be doing a lot more thinking about at Shift as the examples of mandatory human rights due diligence proliferate – and we look forward to sharing our thinking widely over the coming year.
Here are 5 things to keep in mind when preparing the report:
You need to do better in 2019.
Last year, Shift examined the human rights reporting of the top 20 largest companies in France, and concluded that, before the law came into force, the majority of those companies did not meet the expectations of the UN Guiding Principles on Business and Human Rights (the global authoritative standard). This raises questions about whether they meet the requirements of the Duty of Vigilance law.
We have begun examining the vigilance plans of those same 20 companies, and early results are consistent with our previous conclusion: most vigilance plans still have a long way to go.
To improve, encourage your company to align its reporting and actions with the UN Guiding Principles. This can help you meet the requirements of the French law, while positioning the company as a leader on future compliance concerns. You can use the UNGP Reporting Framework’s straightforward questions for guidance.
(Learn more about how the UNGPs and the French Duty of Vigilance Law are aligned here.)
Clearly identify the company’s salient issues.
The first step of the human rights due diligence process is to identify the negative impacts a company and its business relationships can have on people. All companies are expected (and, under the French law, required) to disclose their salient (i.e., most severe) human rights impacts. (Learn more about salient issues and why they matter in this video.)
Prioritizing salient issues allows companies to focus resources on managing risks to human rights, and related risks to the business. When it comes to reporting, it’s also what investors and other stakeholders – including directly affected people – want to see companies disclosing.
If your company hasn’t identified its salient human rights issues, explain any steps taken so far, and offer a preview based on the company’s experience and due diligence to date. After all, nothing is set in stone. As some challenges are met, others arise, and a regular salient issues evaluation will keep you on track.
Be transparent about where you are doing well, and where you’re falling short.
Be confident about sharing breakthroughs; everyone needs examples of what works! Be precise about your procedures, initiatives and strategies for ameliorating your most severe human rights risks, and be forthright about things that still need more work.
As in any other risk management process, no company is ever “done” managing human rights issues. The idea is to deliver authentic reporting by being transparent, demonstrating diligence and improvement through lessons learned, and sharing implementation challenges to contextualize the company’s efforts.
You may not yet be able to demonstrate robust implementation of the UN Guiding Principles, but you can certainly convey your seriousness to your stakeholders with your commitment to transparency and accountability on human rights.
Get inspired and encouraged by other companies and their journeys.
Moving forward on the UN Guiding Principles and the French law can take time, but you are certainly not the only company trying to do so. Many companies in and outside of France have already begun pushing the boundaries on meaningfully acting and reporting on human rights issues. Companies like Unilever, ABN AMRO, ING, Ford, Ericsson, Microsoft, H&M,Nestlé and Newmont have made great strides in their efforts to improve their disclosure, publishing generally stronger and more transparent sustainability reports.
To highlight one example in France, our early research shows that Orange made a significant jump in maturity from previous years. Orange’s vigilance plan is much more comprehensive and transparent than most of its peers’, making clear the company’s process for identifying its salient human rights issues, and implementing its obligations under the Duty of Vigilance law and its responsibility to respect human rights under the UN Guiding Principles.
If reporting processes spark the right kinds of conversations inside the company and glean meaningful information, they become an integral part of how the company identifies and manages human rights risks.
View reporting processes as a risk management investment.
If reporting processes spark the right kinds of conversations inside the company and glean meaningful information, they become an integral part of how the company identifies and manages human rights risks. This process can illuminate potential gaps in management, providing an annual opportunity to assess, redress and improve.
Promisingly, however, the Canadian government is increasingly focused on responsible international corporate activity. In January 2018, Canada’s Ministry of Trade announced a new independent function—the Canadian Ombudsperson for Responsible Enterprise (CORE)—to investigate human rights abuses connected to corporate activity abroad. (The Ombudsperson has yet to be appointed.) Additionally, the Ministry created a multi-stakeholder Advisory Body -with John Ruggie (who chairs Shift’s Board of Trustees) serving as Honorary Chair- to advise the government and the CORE on responsible international business conduct. Meanwhile, a proposed Modern Slavery Bill, currently up for discussion in the House of Commons, would require enhanced annual reporting by business, and impose fines on companies not engaging in due diligence on modern slavery and child labour.
The majority of the companies we analyzed are failing to communicate a comprehensive narrative around human rights, cherry-picking instead a limited set of issues.
Given the long history of human rights
impacts associated with the mining industry and these changes in
Canada’s regulatory framework, Shift has analyzed the human rights
disclosure of 18 of the top TSX-listed Canadian mining companies.
Our aim is to highlight opportunities,
as suggested by the companies’ own reporting, for improving how they
address human rights risks and impacts.
Shift’s methodology is two-fold: first, our team maps companies’ human rights reporting against the expectation that companies know and show how they respect for human rights, as set out in the UN Guiding Principles on Business and Human Rights (UNGPs). We analyze this using the UNGP Reporting Framework, the world’s first comprehensive guidance for company reporting on respect for human rights. Next, we apply Shift’s unique maturity analysis, establishing indicators of mature reporting, and distinguishing laggards from leaders along a tiered maturity scale. While we recognize that reporting is not a mirror of companies’ actual performance in this area, it is an important window into the company’s approach and practices, giving insight into likely strengths, weaknesses, and gaps.
Our team identified notable trends in
conducting this research, some of which were comparable to those in
previous analyses of other industries available in the UNGP Reporting Database.
However, Shift found that the overall maturity of reporting by Canadian
mining companies is slightly lower than for other industries already
assessed. The majority of the companies we analyzed are failing to
communicate a comprehensive narrative around human rights,
cherry-picking instead a limited set of human rights issues without
justifying their selection, or reporting in general on sustainability
and corporate social responsibility issues without acknowledging their
specific responsibility to respect human rights.
Similarly, even
though some disclosure may highlight policies in place around human
rights, or even provide examples that demonstrate the company is
addressing some human rights concerns, most disclosure in this group
lacks a cohesive narrative, structure, and insight into how companies
understand, prioritize, and address risks to human rights connected with
their business. Of the 18 companies analyzed, only two solidly attained
Mature levels (4 out of 5 on Shift’s tiered maturity scale).
Both of these companies illustrated their strong human rights policy
commitments, reported on operational-level grievance mechanisms and
remedy provided for impacts, and provided robust information about
stakeholder engagement practices.
Based on the detailed findings outlined in our report, we produced a set of recommendations, some of which are highlighted below, and most of which can be applied more broadly across industries:
Highlighted Recommendations:
Sharing a policy commitment is important, but only a first step: companies should also share how human rights policies are developed and communicated, and build on their policy commitments by identifying their specific salient human rights issues. Additionally, quality disclosure distinguishes between the management of human rights risks and philanthropic or charitable activities—and ensures the two are not conflated.
Meaningful reporting is key to gaining stakeholders’ trust in a company’s ability to provide effective remedy. Thus, companies should disclose specific processes employed to address grievances, information about complaint outcomes, and details about independent reviews or oversight of grievance mechanisms.
Insightful reporting requires frank and honest sharing of challenges faced by a company, and is bolstered by specific examples that shed light on a company’s approach to addressing them. Honest discussions can provide positive insights and confidence in a company’s ability and efforts to improve their performance, while a defensive narrative can decrease such confidence.
At Shift, we regularly see how reporting processes serve as a powerful driver of improved performance. We hope that these recommendations prove useful to Canadian mining companies, and in turn raise expectations for the sector as a whole, aiding mining companies in Canada and beyond in collectively improving their human rights reporting and performance. Read our full list of recommendations and analysis in, Human Rights Reporting in the Canadian Mining Sector: Maturity Trends and Insights.
This article first appeared in the Ethical Corporation blog on December 18, 2018
As the year comes to an end, it is only natural to think back to the many business and human rights happenings of 2018: Facebook’s inaction as its platform was used to incite rape and murder in Myanmar; the continuing stories of displaced communities in Thailand and Indonesia, forced labour in nail salons in the UK and child labour in brick production in Uganda and Brazil. The appalling stories of sexual harassment across western workplaces, and gender-based discrimination in China. And the growth in attacks on human rights defenders who speak out against business abuses.
The easy formula would be, of course, to write yet another “top five
issues in 2018 and what to expect in 2019” piece. But what do those
articles achieve? Year after year, they all come down to the fact that
while some issues linger, and some new ones emerge, the fundamental
problems for society remain.
So perhaps the end of the year should steer us in a different
direction. One that aims not to list out all the individual crises of
respect for human rights – past or anticipated – nor the commendable
responses from a growing number of companies, but instead to address
social inequality as a whole.
We kicked it off in June with the 13th edition of our Business Learning Workshop. If you have been part of the Shift family for a while, you know how much value we place in the opportunity to engage more deeply with our business partners on a specific theme. The workshop is a unique space where all participants in our Business Learning Program – representing a range of industries – come together to discuss really challenging areas of implementation with the UN Guiding Principles. We make a tremendous effort to ensure that the workshop creates a safe space where companies can openly discuss their challenges, and we can learn together about what works in practice. For this past workshop, we decided to focus on stakeholder engagement – a theme we had previously focused on but realized there was much more to explore.
After two days of insightful discussions, role-plays and example
sharing, I came back home thinking about my own list of takeaways from
the workshop. I’ve found great value in referring to that list as I have
continued to engage with businesses, financial institutions, and other
stakeholders in the months that followed. So, here are my nine key takeaways
from our discussion about how to consider stakeholder engagement from
the perspective of the UNGPs, with practical steps that might help turn
these insights into action.
It is absolutely essential that we re-humanize due diligence.
Companies understand that they need to engage with affected stakeholders as part of their due diligence efforts. Yet many of them struggle with how to put this into practice – particularly given the scale and complexity of global value chains. Stakeholder engagement can easily become something we ‘have to do’ (and show that we have done).
Therefore, companies tend to rely upon more scalable approaches – engaging with policy level stakeholders close to home, proxy representatives to speak on behalf of affected stakeholders, or research conducted by others. ‘Affected stakeholders’ then becomes something abstract and amorphous – creating a distance between the company and the people who might be impacted by the company’s activities.
The result:We’ve lost the human element of human rights due diligence. Companies tend to forget that business and human rights is about actual people, whose everyday realities are affected by business activities. And it’s a lot harder to continue to tolerate exploitation of others when you’ve met them in person. So how can they close that gap and ‘re-humanize’ human rights due diligence?
To do: Don’t look at engagement as something to cross off your list. Instead, look across your due diligence processes: where and how are we as a business hearing directly from people who might be impacted by our activities? What are the one or two further opportunities you could build into your due diligence framework to hear more directly from affected stakeholders?
For just a minute, forget about scale.
At Shift, we see so many companies worried about scale, and we understand. You have tens or hundreds of thousands of business partners, with exponentially more stakeholders, and you cannot engage with all of them. Yet we have also seen the power that a single direct engagement between a company leader and an affected stakeholder can have in shifting company mindsets and attitudes, and the effect that this can then have in driving efforts to respect human rights in practice.
To do: As you develop your due diligence approaches or strategies, find opportunities for different leaders within the business – from the CEO on down – to engage directly with an affected stakeholder. No, you cannot do this at scale. But it may be the most significant step you can take.
Now think about more effective ways to get to scale.
While direct stakeholder engagement is preferable, the reality is that this can’t always happen, and certainly not at the scale and complexity of many companies’ global value chains. So, if companies have to rely upon second-hand engagement (through proxies and other third-parties), how can we ensure that these voices are coming through more effectively?
To do: Effective grievance mechanisms are one of many ways in which companies can reach scale with global value chains. When they work well, grievance mechanisms can provide a direct window into some of the concerns of affected stakeholders, their worries and their needs. Look at the effectiveness of grievance mechanisms at various points in your value chain. For particularly high-risk areas, how could you support stronger, more effective grievance mechanisms – either in your own operations or within the operations of value chain partners?
Measure quality, not quantity.
Most companies love quantitative metrics. Key performance indicators (KPIs) are the way in which many businesses measure success. But what are they measuring when it comes to stakeholder engagement? What can we really learn from the number of engagements you’ve had, or the number of people engaged?
To do: Instead of focusing on quantity, develop tools that assess the quality and effectiveness of your stakeholder engagement (and that of your value chain partners). Start measuring the extent to which stakeholder engagement is helping to shape and inform your human rights work.
Don’t outsource, but be ready to recognize where you might need help.
Stakeholder engagement is a powerful tool for building authentic, long-term relationships between companies and their stakeholders; it cannot simply be outsourced. That being said, there are specific skills and capacity required to engage successfully with different types of individuals, groups and communities. Effective stakeholder engagement may require understanding context, history, and the nuances of culture – in order to be fully sensitive to who your stakeholders are, what they care about, or how decisions get made. Many of these, sound more like the tools of an anthropologist than a business leader (which may explain why we have seen many extractives companies increasingly bringing people with these types of skill-sets in-house).
To do: Look at the capacity that you have in-house and the capacity that you need to successfully engage with stakeholders. Are there gaps in the skill-sets you have in-house? Who could you partner with to bridge those gaps, while continuing to own the process of engagement as a business?
Problem-solving is one of the boldest ways to transform a relationship.
Many companies have specific stakeholder relationships that are particularly challenging. There may be a history or a legacy of less constructive engagement, and perceptions may have hardened. How can businesses transform these dynamics? We’ve seen many examples where companies and stakeholders – who may not have previously been able to sit down in the same room together – find ways to work collaboratively on a specific crisis out of necessity. The company has the opportunity for action, rather than words, and in many cases, both sides are able to recognize the underlying intentions of each other and find value in the collaboration. Often, they are then able to leverage that into rebuilding their relationship.
To do: Look at the major issues that you are currently dealing with. What have you done, or not done, that might be contributing to a particularly challenging relationship with a stakeholder who is critical of you? Then reach out to that critical stakeholder, and invite them to collaborate in a different way, momentarily setting aside any historical baggage, to solve a specific problem together.
Stakeholder engagement is a critical component of remedy.
Remedy is not just about the company taking action to right a wrong. Often, the reason the impact occurred or escalated in the first place is because stakeholders felt marginalized or voiceless. In many cases, meaningful engagement with stakeholders can be the most important component of remedy, so that stakeholders can feel heard by the company. It is not just about addressing the impact, but changing the nature of the relationship that may have contributed to the impact occurring or escalating in the first place.
To do: When looking at an issue or a grievance, build in a component of meaningful direct engagement with the person or group on the other side. You might be surprised at the way that engagement can transform the situation.
Build a supportive environment to develop and/or strengthen effective channels of communication.
This one is particularly relevant to the workplace. Businesses often face challenges in knowing who to engage, who speaks for whom, and what is ‘enough’ engagement. Many of these challenges are addressed if workers have been able to organize freely and create their own credible representational structures. We often refer to freedom of association as an enabling right, because getting that right can help address so many other workplace rights. Likewise, it can enable more effective stakeholder engagement. Trade unions at the site level, and effective global framework agreements at the headquarters level, can not only help businesses meet their responsibility to respect these particular rights, but can also streamline engagement in the workplace.
To do: When you are looking to engage with workers, see how you can leverage existing representational structures. And where they don’t exist, try focusing on how to enable them, rather than finding alternative ways to engage with the workers.
It’s stakeholder engagement, not stakeholder management.
When I talk with businesses about particular stakeholder relationships, it often seems like they are trying to manage a potential reputational risk by engaging with certain stakeholders, rather than having a meaningful dialogue that informs their due diligence. It feels both transactional and tactical. This type of approach may be appropriate in some instances – but this is not what we mean by stakeholder engagement – and companies really need to differentiate this kind of approach from the kind of meaningful stakeholder engagement we know is essential.
To do: Look at your engagement approach, and differentiate those stakeholders you might be looking to manage, from those you are looking to engage.
I hope some, or several of these takeaways may have sparked your thinking in some way. And, ideally, have been some further inspiration to drive meaningful change. As for me, I am already looking forward to our next edition of the Business Learning Workshop in a few weeks in London. You can learn more about our Business Learning program here.
As the former Special Representative of the UN Secretary-General on
the issue of Business and Human Rights and the author of the UN Guiding
Principles on Business and Human Rights (UNGPs), I take great interest
in the progressive implementation of measures to advance business
respect for human rights, including through national policy and law.
With great respect, I was therefore disappointed that the Swiss
Government decided not to put forward a counter-proposal to the
referendum Initiative on responsible business conduct. The subject is of
immense importance for major Swiss companies and for Switzerland’s own
national brand.
At the same time, I am pleased that the Groupement des Enterprises
Multinationales (GEM), which represents over 90 multinational companies,
has taken a constructive position on the Initiative. Its
Secretary-General, Arnaud Bürgin, is reported to have said that GEM
agrees in principle with a counter-proposal currently discussed in
parliament that includes due diligence measures. In turn, the organizers
of the Initiative have indicated that they would be willing to accept
this business-driven formula.
Human rights due diligence throughout the value chain is the most
effective tool for companies to avoid involvement in human rights harm.
It protects values and value alike. That is why governments, businesses,
and civil society have been strong supporters of it, going back to the
unanimous endorsement of the UNGPs by the UN Human Rights Council in
2011.
Switzerland would not be alone by undertaking progressive change in
this space; indeed, it risks falling behind. Anti-slavery legislation
has been adopted in a number of jurisdictions, ranging from California
to the UK. France has adopted a “due vigilance” law. Canada has just
established the office of ombudsperson with authority to compel
witnesses and documentation from Canadian companies operating overseas
that have been accused of human rights violations. The new German
government, as part of its coalition agreement, will require companies
to have human rights due diligence measures in place if, by 2020, fewer
than half of German companies with more than 500 employees have not
adopted them. The European Commission is examining corporate governance
rules, requiring boards of directors to adopt and disclose their
sustainability strategy, including appropriate due diligence throughout
their supply chains. This list is not exhaustive, but it does underscore
the new normal of human rights due diligence by firms.
There is still ample opportunity in Switzerland for informed and
thoughtful discussion of the issues being raised by the Initiative and
GEM. I urge all concerned to engage in constructive dialogue and move
toward the convergent position of these major stakeholders.
John Ruggie is the Berthold Beitz Professor in Human Rights and
International Affairs at the Harvard Kennedy School of
Government.
I spoke recently to the New York City Bar Association at a Continuing
Legal Education program on why business and human rights matter for
lawyers. Based on a show of hands, most of the lawyers attending the
session were law firm litigators. Only a few were corporate or
commercial lawyers. This was unfortunate, because business litigators
usually address human rights long after the horse has left the barn and
is galloping far into the next county.
Business litigators usually address human rights long after the horse has left the barn and is galloping far into the next county. Non-litigators, in contrast, have a much better ability to provide wise advice to clients up front on how to avoid involvement in human rights abuse in the first place.
Non-litigators, in contrast, have a much better ability to provide
wise advice to their clients up front on how to avoid involvement in
human rights abuse in the first place.
Lawyers outside the courtroom typically see proactive advice on
business and human rights as a squishy subject, because it involves
navigating between the shifting boundaries of hard and soft law. It
requires demystification for those lawyers who advise boards on
strategic risks, prepare public disclosure reports, draft contracts,
negotiate deals and structure legal frameworks.
I have tried to do make this clearer in two recently published articles.
The first, “Wise counseling on global supply chains,”urges
business lawyers to take a more holistic approach towards negotiating
supply contracts, and not rely exclusively on boilerplate contract
language and the inclusion of audit clauses.
Recent European law society initiatives also underscore the
importance to lawyers and their clients of taking into account human
rights norms that extends beyond providing technical advice and
services, particularly at the outset of the lawyer/client relationship.
Specifically, the European Bars Federation/ Fédération des Barreaux
d’Europe (FBE), a Strasbourg-based association of 250 European bar
associations with approximately 800,000 lawyers, recently launched a Guidance in Business and Human Rights for European Law Societies to help them address the implications of the UN Guiding Principles.
The FBE Guidance is driven by the EU’s recognition of the Guiding
Principles as the authoritative policy framework on business and human
rights in aligning the EU’s Strategy on Corporate Social Responsibility
and other EU initiatives, including the development of National Action
Plans to implement the Guiding Principles.
The FBE Guidance recommends that bar associations take far-reaching
and proactive efforts to embed the Guiding Principles into all areas of
legal practice, including:
A public commitment by law societies to respect human rights and reduce obstacles to access to remedy;
Disseminating the Guiding Principles internationally;
Educating and training lawyers in business and human rights;
Boosting the role that lawyers must play to support the effective respect of human rights and provision of remedy;
Advancing criteria and ethical guidance to help lawyers resolve dilemmas;
Increasing the capacity of law societies to address business and human rights issues;
Taking a proactive role in the development of significant business and human rights initiatives.
To that end, on February 1, 2018, the Geneva Bar Association, an FBE member, amended its Professional Code of Conduct
to provide that lawyers should do their best to mitigate the risks of
human rights abuses by corporate clients by promoting their inclusion up
front in the early stages of their advice or when helping to prepare
agreements or contracts. This language is precatory, not merely
permissive.
These European initiatives make it clear that the subject of business
and human rights is not just for litigators anymore. Legal advice that
helps a client avoid trouble is always much cheaper than the legal cost
of cleaning a mess after it happens.
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