Frequently Asked Questions
Corporations affect every aspect of modern life. They are suppliers of all types of goods and services, as well as being employers, investors, taxpayers, and political actors. Their power and reach impact economic growth, poverty reduction, and standards of living globally.
The past decades have seen increasing privatisation of public services, as well as growth in overseas investment, followed by a global recognition of not only the influence, but the responsibility of companies to conduct their activities in a way that is respectful of human rights.
Building on existing international law, the United Nations Guiding Principles on Business and Human Rights (UNGPs), endorsed by the Human Rights Council in 2011, recognise the state duty to protect human rights, the responsibility of business enterprises to respect human rights, and the right to remedy. The corporate responsibility to respect human rights includes avoiding infringement in the first place, as well as addressing any adverse impacts that result from corporate operations (UNGP Principle 11).
The responsibility to respect refers to all internationally-recognised human rights, including, at a minimum, those encompassed in the International Bill of Rights (the Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights) and the principles concerning fundamental rights set out in the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work.
As business enterprises can have an impact on virtually the entire spectrum of internationally-recognised human rights, their responsibility does not end at the aforementioned instruments. As the UNGPs recognise, depending on the circumstances, companies should consider other international standards that may apply to the particular impacts of their operations on individuals and communities, recognising the vulnerability of specific groups, such as indigenous peoples, women, children, people with disabilities, refugees, and others.
II. Is human rights protection in relation to business activities a duty of states or a responsibility of corporations?
Under international law, states have the primary legal obligation to uphold human rights. This entails both a negative obligation to refrain from committing any act which interferes with the exercise of human rights, as well as a positive duty to adopt the necessary measures to ensure that other parties, including corporations, respect human rights.
The duty to uphold human rights includes the obligation to adopt policy, legal and judicial measures that safeguard people from corporate human rights abuses, as recognized by the UNGPs as well as by international human rights bodies such as the UN Committee on Economic, Social and Cultural Rights and the UN Committee on the Rights of the Child. When corporate abuse occurs, states must ensure that perpetrators are held accountable and that victims can access justice, as prescribed by the right to a remedy.
The corporate responsibility to respect human rights is not only a matter of state law, but is also provided for in the UNGPs, which explain that states and companies have concurrent but distinct responsibilities, divided into three pillars:
1. the state duty to protect against human rights abuses by third parties, including business;
2. the corporate responsibility to respect human rights;
3. access to effective remedy for victims of business-related abuses
The corporate responsibility to respect human rights does not end at compliance with domestic laws and regulations. Where states have failed to implement laws for the protection of human rights, companies must still respect human rights.
III. Does the corporate responsibility to respect human rights extend to business relationships and/or global supply chains?
The corporate responsibility to respect human rights encompasses both direct and indirect impacts.
Economic globalisation, including the international liberalisation of trade and investment, has enabled companies to operate across borders. Global corporate structures and value chains make use of labour, raw materials, and other resources sourced around the world, while products and services are sold to consumers all over the planet.
In this context, it is widely acknowledged that the conduct of companies can have negative impacts on the human rights of those affected by their global operations. A corporation’s impacts on human rights may be either direct (i.e. caused by its own conduct) or indirect (i.e. caused by the conduct of its subsidiaries, suppliers, contractors, subcontractors, etc.).
Businesses should adopt measures that identify, prevent, and account for both their actual and potential impacts, as well as those impacts linked to their subsidiaries and other business relationships. At a minimum, these processes require ongoing and effective monitoring of a corporation’s global operations, including consultation with rights-holders, and reporting on human rights impacts and the measures adopted to tackle them.
Even though many businesses operate across borders, the rules regulating the impacts of their activities on people and the environment are often restricted to domestic legal systems. Furthermore, multinational corporations often operate in countries where the state is either unable or unwilling to uphold human rights.
Individuals and communities impacted by global corporate structures and supply chains often face insurmountable obstacles to obtaining justice and redress for the harm they suffer. As a result, wrongdoing by corporate actors often goes unpunished, while victims are left without effective remedy. This situation has produced accountability gaps with serious consequences for those affected by corporate-related abuses.
While the UN Guiding Principles on Business and Human Rights call for a “smart mix” of voluntary and regulatory measures, institutions at the international and national levels have so far favoured a voluntary approach, allowing corporations to regulate themselves. This approach is premised on the belief that voluntary guidelines and incentive-based measures are sufficient to ensure that businesses respect human rights.
However, this belief is not reflective of reality. Self-regulation and voluntary measures intended to foster corporate respect for human rights have proven ineffective. Human rights disasters linked to corporate activity, such as Bhopal, Rana Plaza, Tazreen, the Samarco disaster, continue apace, with victims left without justice. Meanwhile, individuals and communities taking action to defend their rights in the face of business operations continue to be harassed and killed. Voluntary measures alone do not work. States must implement legal frameworks that recognize the corporate responsibility to respect human rights throughout global operations. Such measures should be tied to the removal of legal and practical barriers faced by victims of corporate abuses in their pursuit of justice.
This demand for legislation is not new and is increasingly being acknowledged by national governments and regional and international bodies such as the Office of the High Commissioner of Human Rights, the UN Committee on Economic, Social and Cultural Rights and the Council of Europe, among others. Other EU institutions, including the European Parliament, the Fundamental Rights Agency, and the Council of the EU have stressed the need for legislative action. The European Commission has welcomed a combination of binding and non-binding measures to address corporate conduct.
At the United Nations Human Rights Council, an intergovernmental working group assigned with the elaboration of an international instrument on business and human rights is discussing the codification of the corporate responsibility to respect human rights and the right to an effective remedy.