INTERNATIONAL: Human rights and business advances

Analysis

On August 13, 2003, the UN Sub-Commission on the Promotion and Protection of Human Rights unanimously adopted the "Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights" (the Norms) (see INTERNATIONAL: Human rights norms good for business - August 27, 2003). The UN Commission on Human Rights subsequently asked the Office of the High Commissioner for Human Rights (OHCHR) to compile a report on the subject for its sixty-first session. Based on the report, the Commission on April 20 adopted a resolution on 'Human rights and transnational corporations and other business enterprises' (hereinafter 'business'). The human rights community has greeted the resolution as a breakthrough, marking the first time the Commission has initiated a serious look at the impact of businesses on human rights.

The resolution was passed by a vast majority of states: only the United States, Australia and South Africa opposed it; Burkina Faso abstained. The United States expressed the fear that an anti-business agenda would hold back economic and social advancement in developing nations, and claimed that the resolution was formulated in a negative tone towards business. South Africa opposed the resolution on the grounds that it was too weak. The resolution was in fact couched in favourable terms, recognising that business can contribute to the enjoyment of human rights, for example, through investment, employment creation and the stimulation of economic growth.

Special representative. Following the recommendations made by the OHCHR, the resolution requests the UN secretary-general to designate a special representative on human rights and business. The special representative will be appointed for two years and will report annually to the Commission. He/she will not monitor business practices or function as a complaint mechanism for victims of human rights abuses, but rather will conduct further work and clarification of the process begun by the Norms in 2003.

The resolution underlines the intention of the UN to strengthen the accountability of corporations in relation to human rights. States have the primary obligation to protect and implement human rights, and already have an obligation to ensure that businesses are regulated to prevent abuse of human rights. If states are unable or unwilling to do so, human rights law must change to be able to hold corporations directly accountable. This development should be seen as a natural consequence in a time when liberal market economies have become the norm, and corporations are becoming more powerful and wealthier than many states.

Mandate. The special representative is mandated to:

• identify and clarify standards of corporate responsibility and accountability for business with regard to human rights;
• elaborate on the role of states in effectively regulating and adjudicating the role of business with regard to human rights, including through international cooperation;
• research and clarify the implications for business of concepts such as "complicity" and "sphere of influence";
• develop materials and methodologies for undertaking human rights impact assessments of the activities of business; and
• compile a compendium of best practices of states and business.

The first paragraph of the mandate seeks to clarify standards of corporate accountability in relation to human rights -- in other words, how companies may be held responsible for violations. Moreover, the requirement to "elaborate on the role of states" leaves open the possibility that the special representative could find that states have failed in effectively governing human rights practices for business.

Stakeholder consultations. The special representative will build on the findings of the OHCHR report, supplemented by the input received from stakeholders during the consultation period leading to the report. This requires further consultation with a range of stakeholders, and requires that the representative cooperates closely with the UN Global Compact, the office established in 2000 in order to encourage cooperation among companies, UN agencies, labour and civil society to support principles in the areas of human rights, labour and the environment.

Both these requirements relate to the concerns raised about the process which led to the UN Norms in 2003. Broad stakeholder consultation -- specifically including business associations -- will legitimise the process in the eyes of business and other stakeholders. However, several multi-stakeholder initiatives in the field of corporate social responsibility (CSR) in recent years have proved less than effective owing to radical differences of opinion, and it will require a strong representative to balance conflicting interests.

Human rights focus. Given the attention that the Norms received when passed to the Commission last year, the work of the special representative will be scrutinised by both employers and workers associations, and strongly supported by non-governmental organisations (NGOs). The attention itself will serve to inform business about human rights. This is not the first such initiative: UN Global Compact continuously raises business awareness of human rights issues, and a few companies have decided to lead the way in the Business Leaders Initiative on Human Rights. A solid web-based resource centre has been built by the Business and Human Rights Resource Centre (see INTERNATIONAL: Human rights focus for business - February 4, 2005), and almost all initiatives on CSR today include human rights.

Outlook. The approach outlined in the resolution appears to represent a wise choice by the Commission. Choosing a single person to be responsible for further development of this issue will increase the possibilities of reaching a clear conclusion, unlike the ambiguity that often results from collective works, especially in such a politically contentious area. However, much will depend on the person appointed. If that person is a genuine human rights expert, and if the task is approached as leading to increased corporate accountability and not just (another) voluntary code of conduct, the work may lead to real changes. It is apparent that the person must also have understanding of and experience in business. There will be numerous conflicting interests to balance in the process. Governments, businesses, unions, NGOs, experts, and multilateral and regional organisations will all have a vested interest in the outcome. Constructive cooperation from business will be crucial.