Hostname: page-component-7c8c6479df-7qhmt Total loading time: 0 Render date: 2024-03-28T22:13:12.268Z Has data issue: false hasContentIssue false

The importance of stakeholder engagement in the corporate responsibility to respect human rights

Published online by Cambridge University Press:  06 November 2013

Abstract

Over the past forty years, there has been a steady rise in the expectation for companies to operate as responsible citizens. Today companies have at their disposal a variety of initiatives, and new levels of accountability have been reached with the advancement of international standards on, among others, corporate responsibility to respect human rights. Against this background, this article provides an overview of the most important guiding tools available on this subject and on how to promote peace and stability when operating in conflict-affected or high-risk areas. The article argues that ongoing stakeholder engagement is a key success factor in meeting the responsibility to respect human rights and that it has to be an integral part of a company's strategy, especially when operating in conflict-affected countries.

Type
The Practice
Copyright
Copyright © International Committee of the Red Cross 2013 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1 Meadows, Donnella H. et al. , The Limits to Growth, Universe Books, New York, 1972.Google Scholar

2 See Figure 1, ‘The Corporate Responsibility Timeline’. This timeline illustrates the evolution and development of some of the international standards, guidelines, and initiatives that resonate with corporate responsibility and respect for human rights, intensified since the inception of the new millennium. Instruments such as the OECD Guidelines for Multinational Enterprises, the Principles for Responsible Investment, the ISO 26000 Guidance Standard on Social Responsibility and the ILO Tripartite Declaration Concerning Multinational Enterprises and Social Policy complement the Guiding Principles in establishing authoritative guidance for the corporate responsibility to respect human rights.

3 Barbara Dubach, ‘Companies: Conflict Sensitive Engagement’, in Andrea Iff (ed.), Money Makers as Peace Makers? The Role of Business in Conflict Zones, Swisspeace Conference Paper 1/2012 (forthcoming, June 2013).

4 These challenges were explored at the Rio+20 Corporate Sustainability Forum sessions dedicated to the theme of social development, which focused on the role of the private sector in the social dimension of sustainable development – as the source of responsible investment, job creation, innovation, and inclusive growth. See the Rio+20 Corporate Sustainability Forum, available at: http://csf.compact4rio.org/events/rio-20-corporate-sustainability-forum/custom-125-251b87a2deaa4e56a3e00ca1d66e5bfd.aspx. All internet references were accessed in October 2012, unless otherwise stated.

5 See the Global Business Initiative on Human Rights, available at: www.global-business-initiative.org.

6 See the UN Global Compact, available at: www.unglobalcompact.org/Issues/human_rights/.

7 Report of the Special Representative of the Secretary-General on the issue of human rights and transnational corporations and other business enterprises, Protect, Respect and Remedy: A Framework for Business and Human Rights, UN Doc. A/HRC/8/5, 7 April 2008, para. 9.

8 Report of the Special Representative of the Secretary-General on the issue of human rights and transnational corporations and other business enterprises, Guiding Principles on Business and Human Rights: Implementing the United Nations ‘Protect, Respect and Remedy’ Framework, UN Doc. A/HRC/17/31, 21 March 2011.

9 The UN Global Compact Ten Principles are ten universally accepted principles in the areas of human rights, labour, environment, and anti-corruption. See: www.unglobalcompact.org/AboutTheGC/TheTenPrinciples/index.html.

10 For example, the Organization for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises, the Principles of Responsible Investment, the International Standardization Organization (ISO) 26000 Guidance Standard on Social Responsibility, and the International Labour Organization (ILO) Tripartite Declaration Concerning Multinational Enterprises and Social Policy refer to the corporate responsibility to respect human rights and were recently updated to ensure alignment with the Guiding Principles. In addition, new UN-supported principles covering specific human rights, such as the Children's Rights and Business Principles, were developed for the use and guidance of companies worldwide.

11 The European Commission's 2011 communication on corporate social responsibility calls on all European businesses to meet their responsibility to respect human rights, as set out in the UN Guiding Principles. The new policy on corporate social responsibility recommends that Member States establish a mix of self- and co-regulations that implement the corporate duty to respect human rights, and invites them to present or update their own plans for the promotion of corporate social responsibility by mid-2012. See European Commission, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, A Renewed EU Strategy 2011–14 for Corporate Social Responsibility, 25 October 2011, available at: http://ec.europa.eu/enterprise/policies/sustainable-business/corporate-social-responsibility/index_en.htm.

12 Several business-led initiatives such as the Business Leaders Initiative on Human Rights and the Global Business Initiative on Human Rights have also contributed significantly to stimulating the discussion and understanding of the responsibility to respect human rights.

13 The Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights, and the International Covenant on Economic, Social and Cultural Rights.

14 As set out in the ILO Declaration on Fundamental Principles and Rights at Work (adopted by the International Labour Conference at its Eighty-Sixth Session, Geneva, 18 June 1998).

15 John Morrison, ‘“Eyes Wide Open”: human rights and justifying business engagement. Reflections on the importance of the Khartoum meeting of 17 May 2006 hosted by UNDP and Ahfad University’, p. 3, available at: www.unglobalcompact.org/docs/issues_doc/Peace_and_Business/Eyes_wide_open.pdf.

16 See Protect, Respect and Remedy Framework, above note 7, para. 24.

17 See Guiding Principles, above note 8, para. 11.

18 Ibid., para. 16.

19 Ibid., para. 19.

20 Ibid., para. 17–22.

21 United Nations Office of the High Commissioner for Human Rights (OHCHR), The Corporate Responsibility to Respect Human Rights: an Interpretative Guide, HR/PUB/12/02, OHCHR, New York and Geneva, 2012, p. 5CrossRefGoogle Scholar, available at: www.ohchr.org/Documents/Publications/HR.PUB.12.2_En.pdf.

22 Barbara Dubach, Systematic Stakeholder Engagement: a Key for Assessing and Addressing Changes in the Global Societal Environment, 2011, p. 7, available at: www.inter-disciplinary.net/wp-content/uploads/2011/06/dubachepaper.pdf.

23 International Finance Corporation, Stakeholder Engagement: A Good Practice Handbook for Companies Doing Business in Emerging Markets, May 2007, pp. 1–2, available at: www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/ifc+sustainability/publications/publications_handbook_stakeholderengagement__wci__1319577185063.

24 B. Dubach, above note 22, p. 1.

25 See Guiding Principles, above note 8, para. 16.

26 Ibid., para. 18.

27 Ibid., para. 20(b).

28 UN Global Compact, Blueprint for Corporate Sustainability Leadership, p. 11, available at: http://unglobalcompact.org/docs/news_events/8.1/Blueprint.pdf.

29 UN Global Compact Office, Guidance on Responsible Business in Conflict-Affected and High-risk Areas: A Resource for Companies and Investors, UN Global Compact and PRI, June 2010, p. 22, available at: www.unglobalcompact.org/docs/issues_doc/Peace_and_Business/Guidance_RB.pdf.

30 See Guiding Principles, above note 8, para. 21.

32 See Guiding Principles, above note 8, paras. 22, 28–29, 31.

33 Encouraged by the Guiding Principles (para. 11) and the UN Global Compact Ten Principles (Principle 1).

34 Various guidance tools and standards refer to or encourage exercising stakeholder engagement throughout the process of respecting and supporting human rights in business operations and activities, such as the UN Global Compact Ten Principles, the Guiding Principles, the ISO 26000 standard, the Global Reporting Initiative, and the International Finance Corporation Good Practice Handbook for Companies Doing Business in Emerging Markets. Particularly useful is the Guide for Integrating Human Rights into Business Management, produced by the Business Leaders Initiative on Human Rights, UN Global Compact, and the UN OHCHR, available at: www.integrating-humanrights.org.

35 See Guide for Integrating Human Rights, above note 34.

36 See International Finance Corporation, above note 23, p. 5.

37 See Guide for Integrating Human Rights into Business Management, above note 34.

39 See Guiding Principles, above note 8, para. 31.

40 See International Finance Corporation, above note 23, p. 6.

41 The Global Reporting Initiative develops its largely adopted Sustainability Reporting Guidelines through a consensus-seeking, multi-stakeholder process involving participants drawn from global business, civil society, labour, academia, and professional institutions. See: www.globalreporting.org/Pages/default.aspx.

42 The Global Forum, established in 2011, is an institution intended to engage multiple stakeholders, independent from their affiliation with the Fair Labor Association (FLA), to address labour, human rights, and environmental issues that arise throughout the supply chains in various industrial sectors or product categories, and where there are identifiable regulatory gaps. See: www.fairlabor.org/global-forum-sustainable-supply-chains (last visited 25 March 2013).

43 FLA, 2011 Annual Report, June 2012, p. 29, available at: www.fairlabor.org/sites/default/files/documents/reports/2011_annual_report.pdf (last visited 25 March 2013).

44 President and CEO of the FLA, at the First United Nations Forum on Business and Human Rights, which took place in Geneva in December 2012. UN Human Rights Council, ‘Summary of discussions of the Forum on Business and Human Rights, prepared by the Chairperson, John Ruggie’, UN Doc. A/HR/FBHR/2012/4, 23 January 2013, p. 7, para. 30, available at: www.ohchr.org/Documents/Issues/Business/ForumSession1/A_HRC_FBHR_2012_4_en.pdf (last visited 25 March 2013).

45 Institute for Business and Human Rights, From Red to Green Flags: The Corporate Responsibility to Respect Human Rights in High-Risk Countries, London, 2011, p. 1Google Scholar.

46 Ibid., p. 1.

48 The Failed States Index 2011 – an annual ranking prepared by the Fund for Peace and published by Foreign Policy – analyses countries worldwide and rates them according to 12 indicators of pressure on the state, from refugee flows to poverty, public services to security threats. See: www.foreignpolicy.com/failedstates.

49 The stated goal of the Human Rights Risk Atlas is to ‘to help business, investors and international organisations assess, compare and monitor human rights risk across all countries’. The Atlas uses 31 different human rights risk indices (e.g., human security, labour rights and protection, civil and political rights, and access to remedy) to map out the human rights risks for business involvement around the world. The Atlas also incorporates the Protect, Respect and Remedy Framework in evaluating the gravity of human rights violations. See: http://maplecroft.com/themes/hr/.

50 The Basel AML Index 2012 is a publicly available global ranking that assesses countries' risk levels regarding money laundering and terrorist financing developed by the Basel Institute on Governance. See: http://index.baselgovernance.org/.

51 The Swisspeace Business Conflict Check, a self-assessment and consultancy service offered to MNEs and SMEs active in politically unstable contexts, assists corporations in analysing their risk environment and defining strategies to cope with challenges arising from conflict. See: http://businessconflictcheck.swisspeace.ch/en/.

52 The OECD Risk Awareness Tool addresses risks and ethical dilemmas that companies are likely to face in weak governance zones. See www.oecd.org/daf/internationalinvestment/corporateresponsibility/36885821.pdf.

53 See From Red to Green Flags, above note 45, p. 2.

54 See Guidance on Responsible Business, above note 29.

55 Voluntary Principles on Security and Human Rights, available at: www.voluntaryprinciples.org/files/voluntary_principles_english.pdf.

56 See ‘Voluntary Principles on Security and Human Rights, Fact Sheet Released by the Bureau of Democracy, Human Rights, and Labor, U.S. Department of State’, 20 December 2000, available at: www1.umn.edu/humanrts/links/volprinciples.html.

57 OECD, Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-affected and High-risk Areas, OECD Publishing, 2011Google Scholar, available at: www.oecd.org/daf/internationalinvestment/guidelinesformultinationalenterprises/46740847.pdf.

58 Ibid., Foreword.

59 See From Red to Green Flags, above note 45.

60 Ibid., pp. 109 and 129.

61 Davis, Peter, Boardrooms & Bombs II: Strategies of Multinational Companies in Conflict Areas, PeaceNexus Foundation, 10 December 2011, p. 16Google Scholar, available at: www.peacenexus.org/what-we-do/examples-of-projects.

62 As laid out in Guidance Point #4 in the Guidance on Responsible Business, above note 29, p. 23. Companies are encouraged to promote and take action towards constructive and peaceful company–community engagement.

63 P. Davis, above note 61, p. 19.

64 See Guidance on Responsible Business, above note 29, p. 24.

65 See From Red to Green Flags, above note 45, p. 119.

66 See Blueprint for Corporate Sustainability Leadership, above note 28.

67 See Guidance on Responsible Business, above note 29, p. 23.

68 Institute for Human Rights and Business, keynote speech by Executive Director John Morrison, ‘Business, human rights and peace: modern challenges in a historical context’, FDFA Annual Conference, Human Security Division, 11 September 2012, available at: www.ihrb.org/pdf/Business-Human-Rights-and-Peace_Modern-Challenges-in-an-Historical-Context.pdf.

69 Local networks are clusters of participants who come together to advance the UN Global Compact and its principles within a particular geographic context. Their role is to facilitate the progress of companies (both local firms and subsidiaries of foreign corporations) with respect to implementation of the ten principles, while also creating opportunities for multi-stakeholder engagement and collective action. See: www.unglobalcompact.org/NetworksAroundTheWorld/index.html.

70 The launch of the UN Global Compact Network Sudan in 2008 was the culmination of two years of local efforts to establish a UN Global Compact Network, beginning in May 2006 with a forum in Khartoum on ‘Public–Private Partnerships in Post-Conflict Societies’, organised by the United Nations Development Programme and the Ahfad University for Women, outcome document available at: www.unglobalcompact.org/docs/news_events/9.1_news_archives/2006_05_17/sudan_outcome.pdf.

71 See Guiding Principles, above note 8, para. 7.

72 See From Red to Green Flags, above note 45, p. 117.

73 With the exception of the OECD Guidelines for Multinational Enterprises and the ILO Tripartite Declaration Concerning Multinational Enterprises and Social Policy, the remaining guidelines are voluntary. Consequently, enforcement mechanisms, independent monitoring, and penalties for non-compliance are non-existent. There are no established compulsory remedial actions for victims of human rights infringements and there are no instituted complaint procedures or grievance channels.

74 See Sudan Divestment Task Force, available at: www.dosomething.org/project/sudan-divestment-task-force.

75 See European Coalition for Corporate Justice (ECCJ), available at: www.corporatejustice.org/-about-eccj,012-.html?lang=en.

76 The ECCJ's Recommendations on EU Priorities for the Implementation of the UN Guiding Principles on Business and Human Rights are available at: www.corporatejustice.org/IMG/pdf/eccj_recommendations_conference_eu_implementation_ungp_may2012.pdf.

77 Ibid, p. 1.

78 See the Corporate Justice Campaign, available at: www.corporatejustice.ch/en/ (last visited 30 May 2012).

79 The campaign launched a petition, which was signed by 135,285 people in Switzerland. See Alliance Sud, available at: www.alliancesud.ch/en/policy/corporate-justice/135285-demand-clear-rules-for-swiss-corporations (last visited 25 March 2013).

80 US Supreme Court, Kiobel v. Royal Dutch Petroleum Co., Case No. 10-1491 (2012).

81 US District Court, Southern District of Florida, In Re: Chiquita Brands International, Inc., Alien Tort Statute and Shareholders Derivative Litigation, Case No. 08-1916 (3 June 2011).

82 Rosenau, William et al. , Corporations and Counterinsurgency, National Security Research Division, RAND Corporation, 2009, p. 7Google Scholar.

83 Ruggie, John G., ‘Keynote remarks at Association of International Petroleum Negotiators’, Spring 2012 Conference, Washington DC, 20 April 2012, p. 1Google Scholar, available at: www.business-humanrights.org/media/documents/ruggie/ruggie-remarks-association-intl-petroleum-negotiators-20-apr-2012.pdf (last visited 25 March 2013).

84 John G. Ruggie, above note 83, p. 1.

85 See ‘Complaint against Nestlé over Colombian death’, in Swissinfo.ch, 6 March 2012, available at: www.swissinfo.ch/eng/business/Complaint_against_Nestle_over_Colombian_death_.html?cid=32242446.

86 See Ivana Sekularac and Anthony Deutsch, ‘Nigerian villagers sue Shell in landmark pollution case’, in Reuters, 11 October 2012, available at: www.reuters.com/article/2012/10/11/us-shell-nigeria-lawsuit-idUSBRE8991SE20121011.

87 See A Renewed EU Strategy 2011–14, above note 11.

88 See Protect, Respect and Remedy Framework, above note 7, para. 19.

89 See Protect, Respect and Remedy Framework, above note 7, para. 55.

90 See J. Morrison, above note 68.