Human rights are under siege: on the streets, in warehouses, in workplaces, in homes. More than ever, boards of directors need to learn the language of human rights so that they can understand and map the human rights risks of the companies they serve.
What is the role of business and of governments in addressing human rights in a pandemic? The UN Guiding Principles on Business and Human Rights presents an excellent starting point.
- States have a duty to protect human rights.
- Business has a responsibility to respect human rights
- Those who are harmed must have access to remedy
Developed by Professor John Ruggie, then the UN Secretary General’s Special Representative for Business and Human Rights, the Guiding Principles set a framework for how states should protect and how businesses should respect human rights. Companies must “know and “show” that they respect human rights.
One essential term in addressing human rights is “due diligence.” Under the UN Guiding Principles, companies need to have a policy in place committing to respect human rights. This commitment, however, does not go far enough. Companies must also conduct a due diligence process, in which they identify, prevent, mitigate, and account for their impact on human rights. The framework also identifies ways in which companies can participate in the remediation process when adversely impacting human rights.
Companies and their boards of directors should understand the company’s sphere of influence: mapping not only the company’s impact on human rights but those of its partners, including suppliers, security forces, and joint-venture partners. Where might the company exert leverage? How far do the boundaries of a company extend?
Having worked with companies to create a due diligence process, I can say with certainty that the UN Guiding Principles represent the best tool we have to address business and human rights.
Due diligence has become more relevant than ever in the time of corona virus, literally a matter of life and death. Companies must prepare for the systemic shocks of a volatile and uncertain world. Had companies developed a due diligence process before the virus they could have been in a far better place to address risks and take anticipatory action, such as developing plans for securing protective equipment for workers, supply chain processes, and contingency planning.
Recently, the concept of due diligence has evolved from being considered part of soft law, or voluntary, to becoming enshrined in law itself – becoming hard law. 2020 represents the third anniversary of the “Corporate Duty of Vigilance Law” in France which requires companies to set up vigilance plans that mirror the due diligence process. This law has global implications, as it applies to all companies registered in France and to the subsidiaries of French companies. The French law requires companies to commit to an on-going prioritization of human rights issues. In addition, French companies who fail to adhere to the Vigilance Law face penalties. It’s important to note that the EU is considering following suit with European-wide measures to address human rights via legal mechanisms.
Companies and boards of directors that have implemented due diligence find themselves better placed to address their impact on human rights, as well as the impact of systemic shocks to the business. To echo a recent resolution by the European Parliament: “corporate human rights and environmental due diligence is a necessary condition needed in order to prevent and mitigate future crises and ensure sustainable value chains.” This is a time to promote systems and processes that build resilience.
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