Human Rights and Business: The Path to Binding Corporate Human Rights Responsibility
Volume 39 Associate Editor
The Rana Plaza building in Bangladesh was home to five garment factories that manufactured goods for European and North American retail companies. In 2013, this eight-story building collapsed, killing more than one-thousand people and injuring thousands more. The building was unfit for the garment industry: the construction’s poor quality and the swampy land it stood on could not withstand the massive, heavy equipment weighing on each of the floors. The disaster is one of many that highlights the human rights abuses that go unnoticed throughout global supply chains, including apparel and footwear brands. And these abuses are not limited to poor and hazardous working conditions; they range from the more direct forced overtime and anti-union abuses to indirect violations, such as corporate land deals that resettle local communities into areas where water and food are scarce. Until the UN adopts binding due diligence obligations for companies, human rights abuses will continue to flourish throughout global supply chains. Global supply chains are almost inherent in modern business. As our world becomes increasingly globalized, companies readily seek to outsource certain parts of their business, such as manufacturing. The International Labour Organization (ILO) has documented this expansion: the ILO reports that more than 450 million people work in jobs with global chains of suppliers. This creates a complex, global supply chain that involves a multitude of countries with various legal rules, norms, and cultures. Subsequently, it is unclear who should guarantee that each part of these supply chains is respecting the human rights of both workers and third-parties. There is a lack of an established authority in this context. Theoretically, international law tasks state governments with this responsibility: namely, to protect, regulate, and monitor the human rights practices of everyone within their borders, including those working in global supply chains. However, according to Human Rights Watch, state governments “have consistently failed to oversee or regulate extraterritorial human rights practices of companies domiciled on their soil.” Not only are instances such as the Rana Plaza disaster persuasive evidence of this failure, the ILO also estimates that over 24 million people are still victims of forced labor. Nonetheless, we must not discredit the important initiatives taken by certain governments in the past few years. For example, as one of the largest tobacco producers in the world, Brazil’s government has recently prohibited child labor in tobacco farming—due to its hazardous nature—and enforces severe penalties when the ban is violated. Importantly, Brazilian law applies these penalties, not only to farmers but to the companies purchasing tobacco. Thus, the penalties motivate the tobacco industry to guarantee that there are no children working on farms in their supply chains. The Brazilian government coupled these penalties with social programs as well that focus on alleviating poverty: a “financial desperation that drives parents to send their children to work.” Brazil is not the only government to develop such a strong approach to human rights violations in global supply chains. In 2016, the German government adopted the National Action Plan for Business and Human Rights. The Plan urged German businesses to enact human rights due diligence throughout their supply chains. By 2020, the German government is determined to have 50 percent of businesses (with more than 500 employees) implement its human rights due diligence plan; Germany will consider legally binding measures, should its Action Plan fail. At first glance, these examples provide hope to the international community that state governments are capable of enforcing human rights standards on global corporations, that we do not need binding standards. While governmental solutions should still be encouraged, the numerous limitations to this approach require a different, more stable authority to ensure human rights protection. Germany’s 2016 National Action Plan in the wake of federal elections provides an example of governmental limits to protect human rights in global supply chains. According to Human Rights Watch, some German political parties are more supportive than others of binding human rights policies for businesses. Others explicitly reject the idea. Given the nature of democratic elections and polarized political attitudes, it is difficult for governments to enact permanent change in the relationship between human rights and business. While the United Nations recognizes the failure of state governments to consistently regulate businesses in their human rights practices, it ineffectively asks businesses to monitor themselves instead. In 2011, the United Nations Guiding Principles on Business and Human Rights was created to lay out international standards that would ensure businesses’ respect for human rights throughout their supply chains. The UN Guiding Principles encouraged businesses to develop both a human rights policy and a due diligence process, as well as to ensure remediation to those affected by human rights impacts that a business has caused or contributed to. Again, we can see a slight initiative by businesses to monitor their own conduct. Four years after the Rana Plaza building collapse, a coalition of labor and human rights groups, as well as global unions, contacted and urged 72 leading apparel and footwear companies to implement a transparency pledge by the end of 2017. This pledge, called the “Apparel and Footwear Supply Chain Transparency Pledge,” asks companies to make public information identifying the supplier factories and subcontractors that produce their goods. The logic behind this goal of transparency is that if companies are more open about their supply chain, human rights due diligence can be advanced and abuses in supply chains can become readily apparent. However, not all companies are willing to voluntarily take on these efforts. Of the 72 apparel and footwear companies contacted, only 17 have agreed to implement the pledge by 2017. Notably, some industry leaders, such as Nike, Patagonia, and H&M Group, are part of the 17 companies committed to the pledge; other industry leaders, such as Hugo Boss, Mango, and Walmart, have failed to commit to the pledge. We should applaud and welcome these powerful efforts some companies have taken, but we must remember their voluntary nature. As its name suggests, the UN Guiding Principles are guiding: not mandatory, not legally binding. Without internal incentives, companies have no legal obligation to conduct due diligence on the human rights practices in their global supply chains. And, many companies feel they are putting themselves at a competitive disadvantage by internalizing the costs of monitoring and regulating human rights. Many of us see the necessity of corporate social responsibility in preventing reoccurring disasters, like the Rana Plaza building collapse; yet, without legal enforcement of this principle, we can expect corporate avoidance of their human rights duties. This is why the UN must adopt binding due diligence obligations for companies. The international community has exhausted all other efforts. State governments cannot be trusted to regulate the corporations on their soil. Even when they do, political opponents often have adverse ideas. Companies lack incentives, apart from moral ones, to oversee the human rights protection of their workers. While the limited progress governments and businesses have made in this area is important, standing alone it is not enough. On June 26th, 2014, the Human Rights Council adopted a resolution to establish an open-ended intergovernmental working group whose mandate is to “elaborate an international legally binding instrument to regulate, in international human rights law, the activities of transnational corporations and other business enterprises.” The third session of this working group took place from the 23rd to the 27th of October in 2017. Here, the working group moved one step closer to a legally binding instrument: the group requested the Chair-Rapporteur to engage in informal consultations with “States and other relevant stakeholders” regarding legally binding standards for transnational corporations. We must pressure the Human Rights Council to move forward with their proposed, binding obligations on businesses. As long as human rights implementation remains a choice for businesses, we can expect companies to choose efficiency, corporate interests, and oblivious disregard. A binding treaty on business and human rights would eliminate this choice.
 Ashley Westerman, 4 Years After Rana Plaza Tragedy, What’s Changed For Bangladeshi Garment Workers? NPR (April 30, 2017), http://www.npr.org/sections/parallels/2017/04/30/525858799/4-years-after-rana-plaza-tragedy-whats-changed-for-bangladeshi-garment-workers.  Id.  Bangladesh Factory Collapse Blamed on Swampy Ground and Heavy Machinery, The Guardian (May 23, 2013), https://www.theguardian.com/world/2013/may/23/bangladesh-factory-collapse-rana-plaza.  Human Rights in Supply Chains, Human Rights Watch (May 30, 2016), https://www.hrw.org/report/2016/05/30/human-rights-supply-chains/call-binding-global-standard-due-diligence.  Following Decades of Rapid Increase, Global Supply Chain Jobs Shrink, International Labour Organization (May 21, 2015), http://www.ilo.org/global/about-the-ilo/newsroom/news/WCMS_370189/lang–en/index.htm.  Id.  Human Rights in Supply Chains, supra note 4.  Id.  Forced Labour, Modern Slavery, and Human Trafficking, International Labour Organization, http://www.ilo.org/global/topics/forced-labour/lang–en/index.htm.  Human Rights in Supply Chains, supra note 4.  Id.  Id.  Id.  Juliane Kippenberg, Should Corporate Social Responsibility be Voluntary or Binding? Human Rights Watch (Sept. 18, 2017), https://www.hrw.org/news/2017/09/18/should-corporate-social-responsibility-be-voluntary-or-binding.  Id.  Id.  Id.  Id.  Human Rights in Supply Chains, supra note 4.  Id.  Ashley Westerman, supra note 1.  More Brands Should Reveal Where Their Clothes are Made, Human Rights Watch (April 20, 2017), https://www.hrw.org/news/2017/04/20/more-brands-should-reveal-where-their-clothes-are-made.  Id.  Id.  Ashley Westerman, supra note 1.  Id.  Open-ended intergovernmental working group on transnational corporations and other business enterprises with respect to human rights, United Nations Human Rights Office of the High Commissioner, http://www.ohchr.org/EN/HRBodies/HRC/WGTransCorp/Pages/IGWGOnTNC.aspx.  Id.  Draft Report on the Third Session of the Open-ended Intergovernmental Working Group on Transnational Corporations and Other Business Enterprises with Respect to Human Rights, Human Rights Council 24 (Oct. 23-27, 2017), https://business-humanrights.org/sites/default/files/documents/DraftReportThirdSessionIGWG.pdf.