Setting the right course for business and human rights

IOE presents its views ahead of this week’s sixth session of the open-ended intergovernmental working group on transnational corporations and other business enterprises with respect to human rights

Blog by Matthias Thorns, IOE Deputy Secretary-General

More than seventy years after the adoption of the Universal Declaration, human rights are still too often disregarded and infringed in many countries around the globe. Systemic challenges such as informality, poor governance and administration, weak judicial systems as well as corruption are impediments to better implementation and enforcement of human rights. The promotion and protection of human rights on the ground is a Kantian imperative.

Business has an important role to play. The UN Guiding Principles on Business and Human Rights make it clear that while governments have the duty to protect human rights, all companies have the responsibilities to respect human rights. The International Organisation of Employers (IOE) and its members, representing more than 50 million companies, are fully committed to work on the better uptake and implementation of the UN Guiding Principles. Human Rights are also the business of business!

When the business community rejects the second revised draft treaty on business and human rights, which will be discussed by an Intergovernmental Working Group in Geneva this week, we do not do so because we want to hide from our responsibility. On the contrary, we do so because the draft treaty will not promote the business and human rights agenda. It does not address the existing gaps in the effective promotion of business and human rights. It fails to outline practical and effective pathways to remedy at local level which are open for all. It also does not build on the huge momentum of the implementation of the UN Guiding Principles.

On the contrary by continuing to diverge from the UN Guiding Principles, the new version of the draft treaty creates huge uncertainties about roles, responsibilities and expectations, and jeopardises the efforts of business to successfully implement the UN Guiding Principles. The ongoing discussion on the scope of the instrument and the fact that the current version of the draft treaty opens loopholes for governments to exempt entire groups of companies, such as State-owned enterprises and “other businesses” from the obligations in the treaty, shows that the treaty will not contribute to a level playing field, but rather the opposite. Many provisions, such as allowing the claimant to choose the applicable law, create great legal uncertainties and are in conflict with principles of international law as well as various national laws. All in all, the second revised draft treaty remains a text which is not fit for purpose.

Covid-19 has shown the critical need for collective action and constructive collaboration. Business is prepared to work with all stakeholders in promoting business and human rights in line with the UN Guiding Principles and building on the achievements. In our efforts to build back better, human rights must be a key focus. It is thereby imperative to strengthen accountability for and the monitoring of the state duty to implement and enforce human rights as well as to guarantee effective access to justice on the ground. This is not only key to create a level playing field, but more importantly to protect the rights of all rightsholders.

Due diligence and transparency are key concepts of the “responsibility to respect” pillar of the UN Guiding Principles. In the last ten years, we have seen very dynamic developments in which Human Rights Due Diligence and transparency have not only become a major focus of companies, but also of governments as well as regional and international institutions. We are only beginning to see now the impact, effectiveness, strengthen and weakness of the very different approaches in this regard. Any discussion on an international framework must not only take into account these experiences but must also ensure that it does not diminish this dynamism.

The discussions in the Intergovernmental Working Group over the last few years have been much too narrow. Major concerns that many governments, businesses and other stakeholders have raised in these discussions have not been addressed.

What is needed now is leadership to fully reverse direction. A complete reboot offers the opportunity to bring countries into the room who have not been involved to date. The international community must step up to make this happen. In doing so we have nothing to lose, but everything to win.

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