Monday, April 21, 2008

Multinationals, Human Rights, and UN - I

As the United Nations prepares to celebrate the 60th anniversary of the Universal Declaration of Human Rights this December, a report commissioned by the UN is challenging governments and business to focus on corporate-related abuses of human rights.

Titled “Protect, Respect, and Remedy: a Framework for Business and Human Rights,” the just-released report is on the agenda of the UN Human Rights Council’s June session in Geneva. Its author, Professor John Ruggie of Harvard, is the Special Representative of the UN Secretary General on the issue of human rights and transnational corporations.

His report describes and endorses “ways to reduce or compensate for the governance gaps created by globalization, because they permit corporate-related harm to occur even where none may be intended.” Governance gaps? It is a key concept of the report. Ruggie defines it as the vacuum “between the scope and impact of economic forces and actors, and the capacity of societies to manage their adverse consequences.” He goes on to explain what it means in one crucial area.

“Take the case of transnational corporations,” he writes, and goes on to illustrate how the gaps have evolved under recent globalization:

[Corporate] legal rights have been expanded significantly over the past generation. This has encouraged investment and trade flows, but it has also created instances of imbalances between firms and States that may be detrimental to human rights. The more than 2,500 bilateral investment treaties currently in effect are a case in point.

While providing legitimate protection to foreign investors, these treaties also permit those investors to take host States to binding international arbitration, including for alleged damages resulting from implementation of legislation to improve domestic social and environmental standards – even when the legislation applies uniformly to all businesses, foreign and domestic. A European mining company in South Africa recently challenged that country’s black economic empowerment laws on these grounds.

At the same time, the legal framework regulating transnational corporations operates much as it did long before the recent wave of globalization. A parent company and its subsidiaries continue to be construed as distinct legal entities. Therefore, a parent company is generally not liable for wrongs committed by a subsidiary, even where it is the sole shareholder, unless the subsidiary is under such operational control by the parent that it can be seen as its mere agent.

Ruggie gives examples of how “the transformative changes in the global economic landscape” are not reflected in current laws, regulations, and bureaucratic procedures. Also vital in contributing to the governance gaps is the reluctance of the host and home countries to risk taking on the transnationals.

“This dynamic is hardly limited to transnational corporations,” Ruggie adds. “To attract investments and promote exports, governments may exempt national firms from certain legal and regulatory requirements or fail to adopt such standards in the first place.”

Under international law, Ruggie points out, “States have a duty to protect against human rights abuses by non-State actors, including business, affecting persons within their territory or jurisdiction,” as also discussed in his earlier (2007) report on his mandate. In this report he finds that “there is increasing encouragement at the national level for home States to take regulatory action to prevent abuse by their companies.”

Here, in opening a long section on “the state duty to protect,” Ruggie makes an implied criticism of human rights experts. “Within governments and beyond,” those experts have a good understanding of the “general duty” of States to protect human rights. But “less internalized is the diverse array of policy domains through which States may fulfill this duty with respect to business activities…at home and abroad.”

In other words, governments have available human rights tools that often remain unused or under-used. Ruggie devotes five pages to them. He urges viewing them as “an urgent policy priority …necessitated by the escalating exposure of people and communities to corporate-related abuses, and the growing exposure of companies to social risks they clearly cannot manage adequately on their own.” Three examples:

-- Revising international investment agreements to ensure that the rights protecting investments abroad are balanced with responsibilities to respect the host country’s domestic environmental and social standards.
-- Adopting policies more proactive in preventing harmful corporate involvement in “conflict zones,” including the use of Security Council-approved sanctions as appropriate to each situation.
-- Redefining fiduciary duties, as the UK recently has done, to require corporate directors to “have regard” to matters such as “the impact of the company’s operation on the community and the environment.”

In concluding his special section on the State duty to protect human rights, Ruggie reaffirms: “The human rights regime rests upon the bedrock role of States. That is why the duty to protect is a core principle of the business and human rights framework. But meeting business and human rights challenges also requires the active participation of business directly.”

He then turns to his second principle, the corporate responsibility to respect human rights. So will I, in my next posting.

Reporting on the Ruggie Report - I

Print Page

1 comment:

Anonymous said...

ATTN: News Editor
Press Statement

International Religious and Spiritual Leader H.E. Shah Sufi Saleh Uddin Ahmed Chisty Gives A Clarion Call to Establish the Religious Brotherhood on the light of Abrahamic Faith.

“The patriarch of all the believers of Allah (God), i.e. Jews, Christians, and Muslims is Prophet Ibrahim (Peace be upon him, Abraham, PBUH). He built the Kaaba in Makkah with his first-born son Ismael (Peace be upon him, PBUH). This was an order from Allah (SWT) that Ibrahim and Ismael (PBUT) construct this Holy House of Allah (SWT) as a place of worship for all the believers on earth. Ismael (Peace be upon him, PBUH) was 17 at the time he and his father built the Kaaba. Prophet Muhammad (Peace be upon him, PBUH), a descendent of the Prophet Ismael (Peace be upon him, PBUH), would come nearly 2,500 years after Kaaba was built and reunify it as a holy place of worship, according to the teachings of the Prophet Ibrahim (Peace be upon him, PBUH). As stated in the Torah and in the Holy Quran "all the generations will be blessed through Ibrahim (Peace be upon him, PBUH)" (Genesis 12 and 18 Holy Bible, Chp 2 Verses 123-141 Holy Quran).”

Dear Religious and Spiritual Leaders,

I wish to plead and make a fervent call to all my brothers/sisters across the world through the courtesy of this letter in carrying forward, upholding the message of Allah (God), His love for mankind, and ensuring lasting peace in a troubled world. The purpose of portraying my call upon all revered world leaders, politicians, and heads of states, policy makers, academicians, and civil society, spiritual and religious leaders is aimed at removing mistrust, misunderstandings the world is unnecessarily obsessed with, we have to liberate the world of undue tensions and wrangling.

My dear revered brothers and sisters, I have been working tirelessly for establishing peace for nearly twenty-five years. We are definitely running out of time. Everyday a large number of innocent lives are taking their toll for no fault of their own. This has to be arrested. The burning question is how this can be arrested? We can only achieve this by arriving at a common consensus and share our noble vision, thoughts, pooling our energy, resources, dialogs based on religious and spiritual concepts together on one common platform and thus thrust all our force in that direction without further wastage of time. Our Holy Books and Scriptures are the source of eternal light to erase all such misconceptions and misgivings. These sacred books as ordained by Allah (God) are irrevocable. It is enshrined and has come to us as an eternal source of strength, driving force sent through our Holy prophets at different times for the betterment of mankind. Unfortunately, we have not been able to use and exploit this to our advantage, as was the enlightened desire of Allah, through His Divine prophets. We are potentially still a force to reckon with on the driving seat to harness our good virtues for the peace of the world.

It is therefore imperative, I feel, that concerted effort needed to renew our honest will to establish the doctrines of Allah in this world, in thoughts, words and deeds, if not we are bound to perish and vanish from the good book of Allah. Politicians, policy and lawmakers and religious leaders of all faith, belief has to work in close conjunction in order to materialize our dream for a world of progress and prosperity. My thoughts go out for the oppressed and the depressed. It is true, many thought provoking, peace loving individuals, groups are working in reducing tension and conflicts, but unfortunately not much has been achieved. It is only through the doctrine of preaching love and respect for families under Allah (God) and the teachings of His innumerable prophets that were sent for the welfare of mankind at different times can bring about welfare, happiness of mankind.

Followers of the Abrahamic faith having one common ancestral root in fact preach love and peace, religious harmony, having sprung from one land. This indeed is a big boon and blessing that we can be proud of. It is time for reality and not rhetoric. It is through this vehicle that we can effectively mobilize our engine together by bringing the Abrahamic faith of all religious faiths together for establishing lasting peace. I have been running all over the world relentlessly making sincere effort to preach the ideology of Islamic Sufism as enunciated and preached by our Holy prophet Hazrat Mohammad (Peace be upon him, PBUH) who inherits the fundamentals of Hazrat Abraham (Peace be upon him) as are also firmly rooted in the common ideology of our Jews and Christian brothers.

I am convinced that we can march forward in our common goals and gospel without further delay, in fostering synchronization on the principles of our common glorious heritage. I would like to make a call upon all world leaders to form a consensus to ensure that this can be established. Unfortunately in recent years, Islam has been widely misunderstood and there lies one of the saddest tragedies of our contemporary world. We believe that our prophets who had all been sent and ordained by Allah were His peaceful messengers for the spread of fraternal brotherhood and live in peaceful coexistence.


Shah Sufi Saleh Uddin Ahmed Chisty
Religious and Spiritual Leader.
International President,
Publication and Co-ordination Centre of Islamic
Ideology and Sufi-ism (PCCIIS International).
-In consultative status the with ECOSOC and
Associated with DPI of the United Nations.