Ethical Performance
inside intelligence for responsible business


Business shouldn’t wait for a consensus on human rights

June 2008

John Ruggie, the UN special rapporteur on human rights, identifies no fewer than 27 internationally recognized human rights associated with business. From freedom of thought to freedom of movement, they cover every sphere of human endeavour. Therein lies the problem. How can companies ensure they fulfill their obligations?

Everyone agrees that the existing situation – a hotchpotch of voluntary initiatives, evolving international criminal law standards and industry arrangements – is a mess. To sort it out, Ruggie proposes three core principles – that the state should protect against human rights abuses by third parties, that companies have a responsibility to respect human rights and that civil society needs effective mechanisms to pursue remedies. This framework has been generally welcomed (see related story here).

But it is early days and Ruggie’s report is short on specifics. Aside from what to do about raising governance standards in developing countries, the biggest challenge is how to deal with corporate offenders. Non-governmental organizations are right to say that transnationals accused of breaches can too easily wriggle out of their obligations by claiming it was all a subsidiary’s fault and nothing to do with them. This legal sleight of hand may explain why 15 of the FTSE 100 have well developed human rights management systems and policies, yet 54 have operations in countries at high risk of human rights violations, according to the Eiris rating agency.

Respect for human rights – to do no harm – is fundamental to corporate responsibility. It extends far beyond risk management and trumps other governance responsibilities, even those to investors. Yet many companies seem to be using the present confused situation as an excuse to do nothing. Human rights policies and procedures need putting into place, and responsibilities mapped to specific management functions – personnel, supply chains, community involvement. Human rights reporting needs improving, as does due diligence on company operations and relations with governments.

In too many businesses, human rights is stuck in its own management silo when it should be embedded throughout company culture. Ultimately, that is the best way of reducing the associated risks and can serve as a useful character reference for the business as a whole, in the event a breach reaches the courts. Companies need to put their efforts into preventing instances of abuse, rather than seeking to explain them away.

Peter Mason | Global | Human rights


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