ANALYSIS: Set-back for Corporate Accountability on Human Rights
Department director of Human Rights and Business, Allan Lerberg Jørgensen, explains why the US Supreme Court ruling to limit the Alien Tort Statute was bad news waiting to happen.
The ruling may very well pull the rug from under a number of similar cases brought against companies such as Daimler, Rio Tinto, and Siemens. Human rights defenders fear that the ruling effectively dismantles one of the most visible mechanisms available to hold large multinational companies to account for their human rights impacts in developing countries.
Companies are not pirates
In layman’s terms the Supreme Court ruling in the Kiobel case concludes that the ATS cannot be assumed to apply to acts committed outside the US. In legal terms it does not have extraterritorial effect. In other words merely having a corporate presence in the US does not mean that you can be sued under the ATS for something you have done in Nigeria or any other foreign country.
One can be surprised that it took so long to come to such a seemingly simple conclusion. The Alien Tort Statute (ATS) is not just any piece of legislation. It was enacted by US Congress in 1789. Partly, it is believed, to combat piracy on the high seas. Two hundred years later it was evoked by human rights campaigners as a means to hold multinational companies legally accountable for alleged human rights wrongdoings by their overseas subsidiaries.
For human rights campaigners, the 18th century anti-piracy law has been a corner stone in campaigns against 21st century multinationals. The Supreme Court ruling last week, appears to have finally shipwrecked the ATS, hinting drily that “pirates may well be a category unto themselves”.
A symptom - not a solution
For the past two decades, the ATS has been one of the most visible manifestations of the global need for greater clarity on the human rights responsibility of corporate actors. The decision to limit the application of the ATS will be welcomed by some and bemoaned by many. But regardless of view point, the Supreme Court’s decision reminds us that the global governance of corporate behavior on human rights should not and cannot be dealt with through 18th century anti-piracy laws. As such the ATS is as much a symptom of a problem as a solution to the problem.
Business related human rights abuses, whether owing to environmental degradation, land grabs or use of forced labour, should in so far as possible be addressed in the national and local contexts where they occur. Whether one believes in extraterritorial mechanisms or not, the real challenge is to ensure that effective access to justice exists as close to victims as possible. Such mechanisms, whether judicial or non-judicial, state-based or non-stated based, are ultimately the most effective guarantor of just outcomes for victims, and for the accused. However, where such mechanisms fail, extra-territorial mechanisms are a necessary part of the solution. As such the decision by the Supreme Court may be a setback for human rights, but it is not the end of the world.
New global solutions for local problems
Proponents of extraterritoriality rightly claim that the global economy has become too complex and too integrated for any one country to manage on its own. Multinational companies are too mobile and too powerful to be reined in by national courts. Therefore, companies should be accountable not only in the host countries were they do business, but also in the home country where they have their headquarters.
This principle of overlapping jurisdictions is a key part of the United Nations Framework on Human Rights and Business. This all-new framework was unanimously endorsed by the United Nations Human Rights Council in 2011, including by governments such as China, South Africa, Russia, Brazil, UK, US, Nigeria, Uganda, Mexico, Japan, Saudi Arabia, Korea, and Thailand, just to mention some.
The same principles have subsequently been incorporated into the OECD Guidelines for Multinational Enterprises, a code of conduct for companies headquartered in any one of the OECD countries. This has led to a strengthening of the OECD National Contact Points. These are bodies capable of receiving complaints of alleged human rights abuses by companies domiciled in an OECD country. Exactly the type of case that the ATS now appears no longer to accept.
Dinosaurs die – evolution continues
This is evidence that the Supreme Court ruling on the ATS is a conservative interpretation of on antiquated law. The ruling explains that the ATS does not apply extraterritorially because this “would imply that other nations, also applying the law of nations, could hale our citizens into their courts for alleged violations of the law of nations occurring in the United States, or anywhere else in the world. The presumption against extraterritoriality guards against our courts triggering such serious foreign policy consequences, and instead defers such decisions, quite appropriately, to the political branches.”
Proponents of extraterritoriality claim that such concerns are not fit for modern-day global capitalism. They argue that the overseas conduct of companies domiciled in a country’s jurisdiction should not be viewed as a foreign policy matter for that country, but as a matter of domestic policy and jurisdiction.
The recent developments in the UN and OECD confirm this trend. In comparison to these contemporary frameworks the ATS was always a dinosaur used for a purpose for which is was never intended. And as we all know, while dinosaurs become extinct, evolution continues.
For further information, contact Cathrine Poulsen-Hansen at cph[at]humanrights.dk.
UN Global Compact Self-Assessment – Version 2.0
The Global Compact Self Assessment Tool is being re-launched in a new and improved version to better reflect current standards and trends.
The Global Compact Self Assessment Tool, which was first launched in 2010, is a free online tool that enables companies to measure their performance on the 10 Global Compact Principles. The tool covers a new management section in addition to an updated human rights, labour, environment and anti-corruption section. The new management feature to the tool enables self-assessment of processes ensuring that the Global Compact Principles are adequately assessed, defined, implemented and communicated in line with the Global Compact Blue Print and the UN Guiding Principles on Business and Human Rights.
- We are happy to introduce this update to the UN Global Compact Self Assessment tool, which was the first online tool for companies to assess their implementation of the Global Compact Principles, said Deputy Director General Victor Kjær from the Danish Business Authority, one of the four founders of the tool.
Also the Danish business community is pleased with the updated tool:
- For many companies, especially smaller businesses, it can be difficult to know where to begin with the Global Compact. This updated tool helps both new potential Global Compact members and existing members, states International Policy Advisor Christine Jøker Lohmann from the Confederation of Danish Industry.
The tool has been developed as a resource for both members and non-members of the UN Global Compact. Non-members can use the tool to assess their current alignment to the 10 Principles of the UN Global Compact. Global Compact members can use the tool to assess their adherence to the principles and as an aid in their mandatory Communication on Progress.
- Many companies ask themselves what the Global Compact principles actually mean in practice. This tool unpacks all 10 principles into checklists consisting of concrete questions and indicators. Along with the new management section, companies can clearly see where their most important challenges are, and begin to address them, says Advisor Cathrine Bloch Poulsen-Hansen, Danish Institute for Human Rights.
- By using the Global Compact Self Assessment Tool, companies can rather quickly generate an overview of to show what they are currently doing well and where an effort is needed to demonstrate improvements over time, adds CSR Manager Birgitte Bang Nielsen from the Investment Fund for Developing Countries.
Partnership behind the tool
The Global Compact Self Assessment Tool has been developed by a partnership consisting of The Danish Business Authority, The Confederation of Danish Industry, IFU, Investment Fund for Developing Countries, The Danish Institute for Human Rights and the UN Global Compact Secretariat.
Since the launch of the tool in 2010, several different companies from all over the world have used it, and the new version of the tool has been presented to business networks in Egypt and Brussels.
Facts about the tool
The Global Compact Self Assessment Tool:
· Translates the Global Compact Principles into practical self-assessment questions and performance indicators.
· Enables companies to analyze their performance with respect to the UN Global Compact, and supports the development of a Communication of Progress.
· Can be used by all company size and sectors
· Available online – free of charge
The Global Compact Self Assessment Tool is freely available online at www.UNGCSA.org
Learn more about the UN Global Compact here: www.unglobalcompact.org
For more information, contact:
Confederation of Danish Industries: Christine Jøker Lohmann: email@example.com
IFU, Investment Fund for Developing Countries: Birgitte Bang Nielsen: firstname.lastname@example.org
The Danish Business Authority: Julie Villadsen, JulVil@erst.dk
Danish Institute for Human Rights: Cathrine Bloch Poulsen-Hansen: email@example.com
DIHR helps produce human rights guide for Rio Tinto
The DIHR has partnered with Rio Tinto to produce a human rights guide for the major global mining company.
The guide is designed to be used by Rio Tinto’s Community and Social Performance (CSP) Practitioners, but may also serve as an inspiration for other companies in similar industries. As such, the guide has the potential to further compliance with the 2011 UN Guiding Principles on Business and Human Rights, as well as other international standards on CSR and CSP:
“International principles on business and human rights will not become effective until we make them operable in the hands of practitioners within organisations. This work has to happen in real partnership between the human rights community and the business community. Rio Tinto’s new Human Rights Guide is a product of dialogue and co-creation drawing on the expertise of both worlds and we are proud to have been part of this process. The Guide offers comprehensive and practical direction to the implementation of the corporate responsibility to respect human rights. We hope it will inspire good human rights practices in Rio Tinto as well as other companies”, says Allan Lerberg Jorgensen, Department Director for Human Rights and Business at the DIHR.
Rio Tinto’s global practice leader for Communities, Bruce Harvey, says the guide shows the company’s commitment to actively protecting human rights which is integral to its license to operate.
"We are committed to the protection of human rights across each and every one of our operations and throughout our business. It's not only the right way to do business but is essential to our license to operate.
As we move into more challenging regions and politically sensitive countries, we face increasing human rights risks that we must understand and address. This guide provides our operational teams with a systematic approach and expert guidance on how to protect, respect, and if necessary help remedy, any human rights impacts," said Bruce.
The guide is available to download from Rio Tinto’s homepage. Click here to find the guide.
For further information, contact Nora Götzmann at firstname.lastname@example.org.
Joining forces: OECD and National Human Rights Institutions sign historic MoU to promote business respect of human rights
At the 11th conference of the International Coordinating Committee of National Human Rights Institutions (ICC) held in Amman, Jordan on 4-7 October 2012, the OECD and ICC signed a Memorandum of Understanding (MOU) to promote business respect for human rights, including aims at further cooperation for the fulfilment of the human rights chapter of the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles for Business and Human Rights.
The MoU includes the establishment of a three year program of mutual assistance and cooperation, specifically ways in which NHRIs can play a role in promoting the OECD Guidelines for Multinational Enterprises, including assisting the OECD National Contact Points.
Right to left: Mousa Burayzat, ICC Chair/ Chair, Jordan National Centre for Human Rights, Marie-France Houde,OECD Senior Economist, Claire Methven O’Brien, Danish Institute for Human Rights, and David Langtry, Chair, ICC Working Group on Business & Human Rights/ Acting Chair, Canadian Human Rights Commission
Claire Methven O’Brien, Senior Adviser at DIHR and co-drafter of the MoU commented –
“The MoU marks and important step towards more systematic communication and cooperation between the ICC and the OECD. NHRIs are uniquely placed to inform about the human rights situation of their countries of operation - information which can be of central use to OECD National Contact Points in conducting their mediation and recommendations work on the basis of the OECD Guidelines for multinational enterprises. “
The ICC Working Group on Business and Human Rights is currently drafting a Fact Sheet which elaborates on the ways NHRIs and OECD Contact Points can work together- including best practice examples.
Read the joint press release of the ICC and OECD here.
Read full text of the Memorandum of Understanding