UN Human Rights Framework: What executives need to know about human rights
Recognition of companies' human rights responsibilities is growing thanks to the work of John Ruggie. But what are the specific issues that business...
Human rights have been a concern for some companies since the anti-apartheid divestment campaigns of the 1980s, but there has been no broad-based uptake of human rights as a business discipline. Relatively few companies have human rights in their corporate vocabulary.
That may change in 2011, thanks largely to the work of Prof John Ruggie, who has served for the past six years as the United Nations secretary general's special representative on business and human rights.
Ruggie has forged a working consensus among companies, governments and advocates that human rights are not just a business concern, but that both governments and companies have human rights responsibilities. The Ruggie, or UN, Protect, Respect and Remedy Framework and companion Guiding Principles provide an entry point for a broader range of companies to consider human rights seriously for the first time and will frame the business and human rights discussion for years to come.
The UN framework, welcomed by the UN Human Rights Council in 2008, has three pillars.
1) The state duty to protect against human rights abuses by third parties, including business, through appropriate policies, regulation, and adjudication.
2) The corporate responsibility to respect human rights, which means to act with due diligence to avoid infringing on the rights of others and to address adverse impacts that occur.
3) Greater access for victims to effective remedy, judicial and non-judicial.
As the final part of his mandate, Ruggie will submit guiding principles for implementing the framework to the UN Human Rights Council later this spring. The completion of the special representative's mandate and the likely adoption of the guiding principles by the Human Rights Council is a unique moment in the field of business and human rights.
For the first time, companies have a clear roadmap for making human rights part of their compliance and corporate responsibility efforts. Companies that view human rights as a core corporate responsibility are familiar with the UN Framework and have begun to align their corporate policies accordingly. Some are already benchmarking the Framework and changing their corporate policies to reflect it. But these companies are a relatively small group among over 80,000 transnational firms.
The framework and guiding principles are relevant for all companies, not just those facing obvious human rights issues, and not just large and visible multinationals. "Protect, respect and remedy" is a phrase that many more executives worldwide will hear and be asked to explain over the next 12 months. If you are, or advise, one of those executives, there are ten things you need to know (and do) about human rights:
(1) Corporate human rights responsibilities go beyond legal compliance.
The corporate responsibility to respect human rights is more than just a legal responsibility. Respecting human rights means not violating them, but also means addressing any "adverse human rights impacts" companies may cause or to which they contribute.
Companies understand and typically comply with human rights when they are embedded in national law. Labour laws prohibiting child labour or discrimination, for example, are domestic versions of international human rights standards.
Human rights generally become an issue when companies operate where local law is absent, not enforced, or inconsistent with international human rights standards. Even then, it's not a stretch for executives to understand that companies must not violate human rights. Few companies will knowingly use forced labour, for example.
Most business and human rights discussions focus on the responsibilities companies have when confronted with human rights abuses by others - governments, suppliers or partners. Many legal issues - whether companies are subjects of international law, how states can enforce standards abroad, and how complicity should be defined - remain unsettled, but the Protect, Respect and Remedy Framework is consistent with widely accepted international law.
The guiding principles call for companies to "treat the risk of causing or contributing to international crimes as though it were a legal compliance issue". They note that even where the company cannot be held legally responsible under domestic law or international standards, individuals can be held responsible for acts of slavery, torture, genocide and other crimes.
The principles suggest that companies should consider pulling out of countries in situations where "legal compliance with domestic law puts the business enterprise in the position of potentially being involved in gross abuses such as international crimes." The principles also reference the international legal standard for complicity in international crimes: "knowingly providing practical assistance or encouragement that has a substantial effect on the commission of a crime".
Ruggie's framework offers companies a pragmatic approach that neither creates new legal obligations nor requires resolution of open legal questions for clarity. The core corporate responsibility under the framework - respecting human rights - includes corporate legal obligations under domestic or international law, but goes beyond legal compliance.
Companies can have an adverse human rights impact or may be perceived to be complicit in the actions of others in situations where no clear legal exposure exists, and companies must respect human rights even when governments do not.
(2) Consider all of your company's activities and relationships and the full range of human rights
A company's activities and relationships determine the appropriate scope of corporate human rights efforts. International standards provide the list of relevant human rights. Specific rights are listed in the eleven documents that comprise the International Bill of Human Rights and the core International Labour Organisation (ILO) conventions:
• The Universal Declaration of Human Rights;
• The International Covenant on Civil and Political Rights,
• The International Covenant on Economic, Social and Cultural Rights; and
• The ILO Conventions prohibiting forced and child labour, and discrimination in employment; and ensuring freedom of association.
While these international declarations, covenants and conventions are not drafted for a business audience, the key concepts are clear enough: individuals have rights and freedoms based on human dignity. Companies must consider all of these rights in order to adequately manage their human rights responsibilities.
In some circumstances, other internationally-recognised rights may be relevant. These may include international humanitarian law for companies operating in conflict zones and the rights specific to vulnerable or marginalised groups such as indigenous peoples, women, ethnic and religious minorities, and children for companies whose activities touch these groups.
Companies must consider the human rights issues in the places where they operate, as well as the rights affected by different business functions, which might include human resources, supply chain management, security, research and development, and community engagement, depending on the company.
A chocolate brand sourcing cocoa from west Africa is expected to consider forced labour on cocoa farms. A beverage company is expected to consider the impact of its operations on the emerging right to water. Internet and telecom providers must pay attention to freedom of expression and the right to privacy.
The scope of a company's responsibility to respect human rights applies "across a business enterprise's activities and through its relationships with third parties", as well as "to all enterprises regardless of size or ownership structure". Every company is different and will naturally focus on different issues among the complete list of human rights. The framework sets the boundaries. The key practical question for companies is the scope of the human rights, activities and relationships each company must consider.
Each corporate human rights programme will look different for companies of different sizes and resources, but all companies must have some form of human rights policy, must conduct human rights due diligence appropriate for its activities and relationships, and must act upon the results.
(3) Adopt a human rights policy.
Adopting a human rights policy - a new experience for most companies - will be the first thing many companies do after digesting the UN Protect, Respect and Remedy Framework. Most companies have never used unfamiliar human rights language in a corporate policy.
Start by referencing international human rights standards like the universal declaration and the core ILO conventions. The level of detail will vary, but may include the elaboration of specific rights relevant to the company's operations, reference to additional international standards and voluntary initiatives, and discussion of policy scope.
A human rights policy, according to the UN framework, should be approved at the most senior level, informed by consultation, stipulate expectations, communicated internally and externally, and reflected operationally.
A policy may or may not reside in a document for a particular company. A small enterprise may have less formal policies than a large multinational. The form is less important than a clear corporate commitment to respect human rights, whether it is a written document or simply communicated to employees by the owner or CEO. The strongest efforts will align all relevant corporate policies, including compensation, procurement and lobbying practices. A human rights policy alone is not enough to meet a company's human rights responsibilities, but it is the necessary first step.
"The declaratory phase of corporate responsibility is over," Ruggie says. He emphasises the need for companies to "know and show" the scope of their human rights responsibilities.
A company must demonstrate exactly how it is meeting its responsibility to respect human rights. It is not enough to join the UN Global Compact, for example, which requires participating companies to adopt ten principles on human rights, labour rights, environmental protection and anti-corruption. To meet the UN framework standard, Global Compact human rights commitments need to be elaborated by the company, communicated to employees and other stakeholders, and reflected in company operations.
(4) Invest in human rights due diligence.
Assessing your company's human rights impacts is the core concept in the "respect" pillar of the framework. Companies must understand the human rights risks posed by their operations in order to meet their human rights responsibilities. If you haven't considered how your company touches human rights, this is the year to start.
The purpose of human rights due diligence is to identify, prevent and mitigate any human rights risks. Companies should assess actual and potential human rights impacts in their own operations, and the risk of complicity in relationships with business partners, suppliers, and others. They should prioritise areas of heightened human rights risk.
What makes human rights due diligence unique from other forms of due diligence, is the focus on impacts on individuals. It goes beyond simply identifying and managing material risks to the company.
Human rights impact assessments (HRIAs) will become increasingly common. The guiding principles outline the necessary components of an HRIA:
"Assessing the human rights context prior to the proposed activity; identifying the people whose human rights might be affected; cataloguing relevant human rights standards and issues; and projecting how the proposed activity could adversely affect their existing enjoyment of those rights."
Human rights due diligence is a dynamic, ongoing activity. New activities or relationships, major decisions or operational changes, and external developments can trigger the need for reassessment.
Understanding and implementing these four items will put your company among corporate best practice leaders on human rights. In part two of my analysis, I will address the six additional things executives need to know (and do) to fully embrace corporate responsibilities under the UN framework.
(5) Act on the findings.
(6) Track and communicate your human rights performance.
(7) Ensure that corporate human rights initiatives contain effective grievance mechanisms.
(8) Consider the UN framework the de facto human rights standard for companies and their stakeholders.
(9) Be aware that stakeholders will use the UN framework to hold your company accountable for respecting human rights.
(10) Pay attention to how governments and companies connect the "protect" and "respect" pillars of the UN framework.
The UN framework and guiding principles are a corporate responsibility turning point. Executives who can translate "Protect, Respect and Remedy" for their company in 2011, will have a competitive advantage as human rights go mainstream for business.
This is the first in a two-part analysis of human rights issues for business. Anthony Ewing teaches business and human rights at Columbia Law School and advises companies on corporate responsibility as a partner at Logos Consulting Group in New York.