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25 January 2016 | Trent Glover, Barrister

Businesses’ responsibilities to respect human rights — the UN’s Guiding Principles on Business and Human Rights

Human rights are something often thought to be the responsibility of national governments. Over the past few years, however, there is a growing awareness of the impact on and participation in human rights abuses by businesses. At the same time, focus is turning to the role that businesses can play in promoting and fostering human rights.

Commencing in 2001, with the endorsement by the United Nations Human Rights Council of the Guiding Principles on Business and Human Rights (Guiding Principles), several international organisations, including the Organisation for Economic Co-operation and Development1 and International Bar Association,2 have released publications designed to raise awareness of the risk of adverse impacts on human rights by businesses and to promote adherence by businesses to human rights principles.

Corporate counsels are now among the most important players involved in the growing awareness of the role to be played by businesses in relation to human rights. This is because of their access to, and influence with, business executives.3

This note examines the Guiding Principles and discusses how Australian businesses can promote and foster a culture of respecting human rights consistently with the requirements of the Guiding Principles.

Development of the Guiding Principles

The Guiding Principles were unanimously endorsed by the United Nations Human Rights Council on 16 June 2011.4

The Guiding Principles are the product of 6 years of research led by Professor John Ruggie, the former Special Representative of the UN Secretary-General for Business and Human Rights, involving governments, companies, business associations, civil society, affected individuals and groups, investors and others around the world. The Guiding Principles are based on 47 consultations and site visits in more than 20 countries, an online consultation that attracted thousands of visitors from 120 countries and research and submissions from experts from all over the world.5

The Guiding Principles apply to all states and to all business enterprises, regardless of their size, sector, location, ownership and structure.6 Nevertheless, the Guiding Principles recognise that the means through which a business enterprise meets its responsibility to respect human rights will be proportional to, among other factors, its size.7

The Guiding Principles are grounded on a “protect, respect and remedy” framework. States, such as Australia, have a duty to protect human rights and provide access to an effective remedy for human rights abuses. This requires states to take appropriate steps to prevent, investigate, punish and redress human rights abuse within their territory and/or jurisdiction through effective policies, legislation, regulations and adjudication.8 As part of their duty to protect human rights abuses, states must also take appropriate steps to ensure, through judicial, administrative, legislative or other appropriate means, that when human rights abuses occur within their territory and/or jurisdiction, those affected have access to an effective remedy.9

Business enterprises have a responsibility to respect human rights. This means that businesses should avoid infringing on the human rights of others and should address adverse human rights impacts with which they are involved.10 The responsibility of businesses to respect human rights is distinct from issues of legal liability and enforcement, which remain defined largely by national laws in the relevant jurisdictions.11

Guiding Principle 12 states:

The responsibility of business enterprises to respect human rights refers to internationally recognized human rights — understood, as a minimum, as those expressed in the International Bill of Human Rights and the principles concerning fundamental rights set out in the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work.

The reference to the “International Bill of Rights” may be a term unfamiliar to most Australian lawyers. It refers to the core international human rights instruments, consisting of the Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights.12 The “Fundamental Principles and Rights at Work” refers to the eight core International Labour Organization conventions.13

The “respect” principle requires businesses specifically to:

(a) Avoid causing or contributing to adverse human rights impacts through their own activities, and address such impacts when they occur;

(b) Seek to prevent or mitigate adverse human rights impacts that are directly linked to their operations, products or services by their business relationships, even if they have not contributed to those impacts.14

The reference to a business’s “activities” is to be understood as referring to a business’s acts or omissions. “Business relationships” is also an expression about which further guidance is given. It means “relationships with business partners, entities in its value chain, any other non-State or State entity directly linked to it business operations, products and services”.15

The Guiding Principles requires businesses to have in place policies and processes including:

(a) A policy commitment to meet their responsibility to respect human rights;

(b) A human rights due diligence process to identify, prevent, mitigate and account for how they address their impacts on human rights;

(c) Processes to enable the remediation of any adverse human rights impacts they cause or to which they contribute.16

Businesses should express their commitment to meet their responsibility to respect human rights through a statement of policy that sets out publicly its responsibilities, commitments and expectations of personnel, business partners and other parties directly linked to its operations, products or services. The most senior level of the business enterprise should approve the policy, which should also be reflected in operational policies and procedures.

Human rights due diligence is a process to ensure businesses engage in assessing actual and potential human rights impacts, integrating and acting upon the findings, tracking responses, and communicating how impacts are addressed.17 Given the dynamic nature of human rights situations, the Guiding Principles state that assessments of human rights impacts should be undertaken at regular intervals, including prior to a new activity or relationship and prior to major decisions or changes in operations. Examples of such situations include market entry, product launches, policy changes and wider changes to the business.18

Of course, even with the best policies and practices, a business may cause or contribute to an adverse human rights impact that it has not foreseen or been able to prevent. In such situations, the Guiding Principles require the business to provide for or cooperate in their remediation through legitimate processes.19

Conclusion

The benefits to a business of complying with the Guiding Principles are many and varied. For example, conducting appropriate human rights due diligence should assist businesses address the risk of legal claims and adverse publicity against them by showing that they took every reasonable step to avoid involvement in an alleged human rights abuse.20 At a broader level, there is undoubtedly a global benefit derived from businesses’ respect for human rights. Corporate counsel can play a vital role in developing policies and processes to give effect to the Guiding Principles within their business to achieve these business, and broader, benefits.

Note: Originally published in Inhouse Counsel, December 2016, Vol 20 No 9-10.


Footnotes

[1] See Organisation for Economic Co-operation and Development, OECD Guidelines for Multinational Enterprises, accessed 7 November 2016, at http://mneguidelines.oecd.org/guidelines/.

[2] See International Bar Association IBA Practical Guide on Business and Human Rights for Business Lawyers (May 2016) at www.ibanet.org/LPRU/Business-and-Human-Rights-for-the-Legal-Profession.aspx; International Bar Association IBA Business and Human Rights Guidance for Bar Associations (October 2015) at www.ibanet.org/LPRU/Business-and-Human-Rights-for-the-Legal-Profession.aspx.

[3] J Ruggie Just Business: Multinational Corporations and Human Rights (Norton Global Ethics Series) WW Norton 2013.

[4] United Nations Human Rights Council Human Rights and Transnational Corporations and Other Business Enterprises(June 2011).

[5] See more at: United Nations Human Rights Council, News and Events, accessed 7 November 2016, at www.ohchr.org/en/NewsEvents/Pages/DisplayNews.aspx?NewsID=11164#sthash.DaoN8Ky6.dpuf.

[6] United Nations Human Rights Council Guiding Principles on Business and Human Rights (2011) 1.

[7] Above n 6, at 15.

[8] Above n 6, at 3 (Guiding Principle 1).

[9] Above n 6, at 27.

[10] Above n 6, at 13 (Guiding Principle 11).

[11] Above n 6, at 14.

[12] The conventions are available in Australasian Legal Information Institute, Human Rights, accessed 7 November 2016, at www.austlii.edu.au

[13] Above n 12; these conventions are Freedom of Association and Protection of the Right to Organise Convention, 1948 (No 87); Right to Organise and Collective Bargaining Convention, 1949 (No 98); Forced Labour Convention, 1930 (No 29); Abolition of Forced Labour Convention, 1957 (No 105); Minimum Age Convention, 1973 (No 138); Worst Forms of Child Labour Convention, 1999 (No 182); Equal Remuneration Convention, 1951 (No 100); and Discrimination (Employment and Occupation) Convention, 1958 (No 111).

[14] Above n 6, at 14 (Guiding Principle 13).

[15] Above n 6, at 15.

[16] Above n 6, at 15–16 (Guiding Principle 15).

[17] Above n 6, at 17 (Guiding Principle 17); States are also encouraged to require human rights due diligence by their agencies: above n 6, at 7.

[18] Above n 6, at 20.

[19] Above n 6, at 24 (Guiding Principle 22).

[20] Above n 6, at 19.