Ten Years of the United Nations Guiding Principles on Business and Human Rights: Much done, plenty more to do
Dr Ciarán O'Kelly and Dr Ciara Hackett review the last ten years of the United Nations' work in embedding corporate responsibilities for human rights into an international legal instrument.
It is ten years this month since the United Nations Guiding Principles in Business and Human Rights (UNGPs) were enacted. They are the outworking of the United Nations Protect, Respect and Remedy Framework which established the complementary obligations of states and businesses regarding human rights. The UNGPs are the first broadly accepted attempt to embed corporate responsibilities for human rights into an international legal instrument. They rest on three pillars:
(I) the state duty to protect human rights;
(II) the corporate responsibility to respect human rights; and
(III) the right to access an effective remedy for an adverse corporate human rights impact.
From the UNGPs, a Working Group on Business and Human Rights was established with a mandate for engaging with relevant actors to promote, support, coordinate and extend the Principles.
The UNGPs’ unique and significant contributions are manifold. First, they were designed by states, business, academia and (some) civil society in partnership. Second, they see corporate responsibilities embedded in an international legal instrument. Third, they place victims at the centre, linking state and business obligations to provide access to effective remedies where there has been a negative corporate human rights impact. International human rights instruments have turned recently to promoting negotiation and dialogue between states, international bodies, private actors, and NGOs (see Gráinne de Búrca’s work here and here). The UNGPs in this mold hold the promise of corporate actors as active partners in regulation rather than reluctant subjects. This invites them to engage in ways that provide context and responsiveness to policies and practices.
A Decade of Action?
The UNGPs turn to global corporations as the key actors in business and human rights. Global corporations play a dual role as instigators of impacts through their activities and as critical partners in addressing said impacts. They act at the centre of diffuse and complex supply chains, profiting at a geographic and legal distance from systems of production and value-creation. The last decade has seen action as human rights due diligence (HRDD), leveraging internal corporate processes to gain insights that would otherwise not be possible.
HRDD is explained as: “a way for enterprises to proactively manage potential and actual adverse human rights impacts with which they are involved.” It comprises four components:
(a) identifying and assessing actual or potential impacts;
(b) integrating findings from impact assessments and taking appropriate action;
(c) tracking the effectiveness of measures and processes to address adverse impacts; and
(d) communicating on how impacts are addressed.
Firms are recruited as human rights investigators and regulators across their value-chains, using contracts to enforce compliance in distant and not-so distant production sites.
The UNGPs’ roots in partnership and HRDD have been decried. Critics worry that state protections might be displaced and weakened. Others question whether unreliable or false information may corrupt HRDD processes. HRDD may create, for some, “a lack of consequentiality of reporting obligations, weak state monitoring, limited stakeholder involvement, and difficulties to establish legal liability” (Page 2).
Such concerns (along with what Backer refers to as states’ temptation to legalise Pillar II) have contributed to an epidemic of domestic mandatory human rights due diligence initiatives including, most recently Germany and Norway. A European-wide initiative on mandatory human rights and environmental due diligence is expected soon. This will build on existing regulatory requirements around Conflict Minerals, and innovations in non-financial reporting.
An unexpected outworking of the UNGPs has involved domestic courts interpreting corporate statements about their adherence to the Principles as (somewhat) binding on corporate conduct. The Dutch courts referenced Royal Dutch Shell’s requirement to comply with the UNGPs regarding CO2 emissions, followed by a similar victory for climate change campaigners in Australia and potentially in Guyana. Developments in the United Kingdom indicate that parent companies might be held liable for the actions of their subsidiaries where they have caused or contributed to a negative impact on the human rights of local communities. The decisions in Vedanta and Okpabi sit apart from the very recent decision in the US, but mirror similar decisions in Canada and potentially, France.
The guidelines have prompted state level policy advances around National Action Plans most recently from Peru. The UNGPs impact can also be evidenced in updates to industry wide initiatives such as the ISO26000 and the Equator Principles. The most recent shift to a global recognition of corporate responsibilities to respect has been discussions around base levelling corporate taxation at initially 21%. And finally, on an international level, the future trajectory of the UNGPs seems to be as a complementary initiative to a Treaty on Business and Human Rights. This has prompted lots of conversations, but it is fair to say that any treaty would, in theory, clarify state duties to protect human rights, further embed corporate responsibilities to respect human rights and offer further legal and financial assistance to victims seeking remedy for corporate adverse impacts.
The UN Special Rapporteur on Poverty and Human Rights, Olivier De Schutter, recently remarked:
“The UNGPs are compatible with a form of economic globalisation that has encouraged tax avoidance on a global scale, exploitation of wage differentials across regions and an extractive relationship to nature. An update is now urgently required. The second-generation UNGPs should do more than ensure the adverse human rights impacts of economic globalisation are assessed, and compensated for: they should ensure globalisation itself becomes a positive force for change.”
Beyond his comprehensive assessment, we argue for the centrality of remedy. This third pillar is underdeveloped. Remedy needs to be interrogated and interpreted, including how cultural/sectoral/gendered understandings of remedy map against the state/non-state, judicial/non-judicial approaches underpinned within the UNGPs. This requires regulators going beyond HRDD and case-by-case responses to human rights impacts. Business and human rights must turn to risks that are inherent in systems of production. Approaches to corporate disclosure that both identify and mitigate such systemic risks is imperative.
The Climate Emergency offers an instructive lens. A firm-by-firm HRDD approach that approaches remedies as costs to avoid neither addresses systemic factors, nor individual contributions to those systems, nor how to enforce liabilities that address attendant harms. The recent Dutch decision points to part of what is required, linking individual firms to their responsibilities for climate change even where they are not solely responsible.
Beyond firm responsibility, the UNGPs cannot simply focus on business partnership in business and human rights. They must act to shape information flows from firms and from civil society so that systemic risks might be defined, identified and understood, not least regarding climate impacts across global value chains. They must find ways to ensure that social licenses to produce and social licences to sell are better linked to understanding and mitigation of, and ultimately restitution for climate and other harms.
Dr Ciarán O’Kelly is a lecturer in the School of Law at Queen’s University Belfast. Ciarán’s current research interests focus on moral language in business and human rights, law and technology and public and private governance.
Dr Ciara Hackett is a Senior Lecturer in the School of Law at Queen’s University Belfast. Her research focuses on the intersection between business and human rights.