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Wilton Park Conference
2 May 2001, Montreux, Switzerland


Statement by Dr. B.G. Ramcharan
United Nations Deputy High Commissioner for Human Rights


Business and Global Corporate Citizenship: Best Practice for the Future
“Business and Human Rights: The Way Forward”



It is a pleasure to have the opportunity to be here with all of you at this Wilton Park conference on the future of the global corporate citizenship movement. The High Commissioner had been looking forward to taking part in your discussions and has asked me to express her regret at being unable to be here today. She sends you her best wishes for a successful conference.

Fundamentals

The Universal Declaration of Human Rights commits every individual and every organ of society to promote and uphold the rights it enshrines. Corporations, their members and their personnel, therefore have a solemn duty to live by the Declaration and other international human rights laws in the course of their activities. Corporations should strive for, and help uphold, democracy, the rule of law and full respect for human rights in the countries in which they operate. They should do nothing, directly or indirectly, to subvert these precepts. Corporations themselves should take particular care to ensure that their activities and practices do not contravene international human rights laws. They should strictly abide by and actively promote universal implementation of the International Convention on the Rights of the Child so as to ensure that every child on the planet has an opportunity to develop to the fullness of his or her potential.

Corporations should never be associated with, and should actively combat, racial, gender, social and other pernicious forms of discrimination. They should actively combat torture, enslavement, arbitrary arrest and detention, enforced disappearances, arbitrary and summary executions and any form of gross violations of human rights. They should play their part in implementing the right to work, to just and favourable conditions of work, the right of everyone to social security, including social insurance, the widest possible protection of the family, the right of everyone to an adequate standard of living, the right to health, the right to education, the right to take part in cultural life, the right to enjoy the benefits of scientific progress, and the right to benefit from the protection of the moral and material interests resulting from one’s scientific, literary or artistic production.

Corporations should be particularly attentive to the situation of minorities, indigenous populations, or communities under any form of threat and should strive to uphold international human rights norms in respect of such communities. They should play their part in supporting national institutions and civil society in their efforts for the promotion and protection of human rights. They should contribute actively, as members of the international human rights movement to education and publicity about international human rights norms so as to help a universal culture of human rights to take roots in all parts of the world.

Leadership of the Secretary-General and the High Commissioner

As most of you know, the High Commissioner has played an active role in the UN’s increased efforts, under the leadership of Secretary-General Kofi Annan, to reach out to the private sector and involve it more directly in addressing issues on the global agenda. In his Millennium Summit report, the Secretary-General made the case for this engagement and highlighted the importance of the theme you will be addressing over the next few days:

“Global companies…more than anyone, have created the single economic space in which we live; their decisions have implications for the economic prospects of people and even nations around the world. Their rights to operate globally have been greatly expanded by international agreements and national policies, but those rights must be accompanied by greater responsibilities — by the concept and practice of global corporate citizenship. The marks of good citizenship may vary depending upon circumstances, but they will exhibit one common feature: the willingness by firms, wherever possible and appropriate, to pursue “good practices” as defined by the broader community, rather than taking advantage of the weaker regulatory systems or unequal bargaining positions of host countries.”

But how do we reach agreement on good practices or know them when we see them? How should they be tested, supported and replicated? Perhaps most important, what are the tools available or still needed to turn “good practices” into “standard practices”?


In the field of human rights, efforts to identify good practices by companies raise complex issues. While few would disagree that businesses are responsible for the safety and well-being of their employees, defining good business practices outside the factory walls is still a work in progress. Questions that arise include:

What is the responsibility of a business with operations in a country where human rights violations are widespread or where company revenues help support an oppressive regime?

Should a corporation be expected to use its influence to affect government policies concerning human rights and the rule of law?

What role should business play in conflict prevention and resolution or in development efforts?

In charting the way forward, both in the broad terms of corporate citizenship and the more specific area of business and human rights, more dialogue and innovative approaches are clearly needed to find solutions to these problems. That is why meetings such as this are so important.

I would like to use the next few minutes to present a general overview of where things stand at the moment within the UN in engaging the private sector on human rights issues and then offer some thoughts on possible directions for the future.

Business and human rights: new challenges and new approaches

We in the Office of the High Commissioner have found that the business community is increasingly eager to engage in dialogue on human rights issues. Business leaders don’t need us to convince them that demonstrating good corporate citizenship affects company reputation and brand image, the ability to recruit and retain the best employees, to gain acceptance with host communities or to secure a license to operate with governments. Business leaders know the extent to which socially responsible investment funds are growing in popularity and they recognize that without respect for human rights and the rule of law, not only will the health and safety of employees be at risk, but also opportunities to build new markets and achieve sustainable growth.

The High Commissioner has consistently welcomed the growing number of initiatives that are mobilizing the skills and other resources of diverse actors to address difficult human rights problems. One important example of such multi-stakeholder initiatives that received a good deal of attention last year is the work of the World Commission on Dams. As you may know, the Commission brought together civil society, industry, governments and the UN family to address the controversy surrounding water and energy resources and the impact of dams, for good and ill, on the lives of individuals and communities.

The fact that the Commission placed its final report and recommendations within a human rights framework. should not be underestimated. This highlights the growing recognition that greater efforts can and must be made to reconcile the need for economic growth with the need to protect the dignity of individuals, the cultural heritage of communities and the health of the environment we all share.

Another multi-stakeholder initiative with important human rights implications was the adoption late last year of security principles for extractive industries. As you know, the initiative was led by the US and UK governments and included the support of leading oil and mining companies, human rights organizations, unions, and business organizations. The principles are an important contribution to ongoing efforts to ensure that corporate security arrangements fully respect human rights.

Allow me to set out some propositions for discussion:

1. Business and world order: Business has a stake in a world of the United Nations Charter and a world of human rights;

2. Business and the international human rights protection system: Business can support the international human rights protection system;

3. Business and strategic mapping of the state of human rights in each country: Business can help us in strategic mapping of human rights needs in countries;

4. Business and capacity building: Business can help us in efforts to promote for national systems for the protection of human rights;

5. Business and human rights education: Business can help promote human rights education;

6. Business and international responses to situations of gross violations of human rights: Business can help combat gross violations such as violence against women;

7. Business responsibility for human rights – some core propositions: Business has responsibilities under the Universal Declaration which I set out in the “Fundamentals” at the beginning of these remarks;

8. Business and the rights to food, education, health: Business can help advance these core rights;

9. Business and trafficking: Business can help combat trafficking in human beings;

10. Business and vulnerable population groups: Business can help promote and protect the human rights of groups such as children;

11. Business and discrimination: Business can help combat discrimination;

12. Tapping the energy of business on behalf of human rights: Business can help the international movement for the protection of human rights.

Global Compact

Let me turn now to the Global Compact.

The potential for multi-stakeholder relationships to foster corporate citizenship is the driving force behind the Secretary-General’s Global Compact. Many of the organizations represented here have taken the lead in supporting this new initiative. As you know, the Secretary-General’s vision for the Global Compact is to work towards a more stable and inclusive global market by encouraging the international business community to build universal principles into its strategic policies and daily practices.

The Compact calls on business leaders to join forces behind a set of core values in the areas of human rights, labor standards and the environment. In the area of human rights, corporations should ensure that they uphold and respect human rights and are not themselves complicit in human rights abuses. With respect to labor standards, businesses should make sure that they are not employing under-age children or forced labor, either directly or indirectly, and that, in their hiring and firing policies they do not discriminate on grounds of race, creed, gender or ethnic origin. And in relation to the environment, companies should support greater environmental responsibility and encourage the development and diffusion of environmentally friendly technologies.

What makes these principles particularly important is that they already enjoy world-wide support, as embodied in the Universal Declaration of Human Rights, the International Labor Organization's Declaration on fundamental principles and rights at work, and the Rio Declaration adopted at the 1992 Earth Summit.

What are companies supporting the Global Compact being asked to do? As a first step, the United Nations is asking companies to:

§ publicly express support for the Compact and its principles in mission statements, annual reports or similar venues;

§ post on the Global Compact website concrete examples of progress made or lessons learned in implementing the Global Compact principles;

§ undertake activities jointly with the United Nations that advance the implementation of the Compact’s principles or support wider UN goals such as poverty eradication.

Success ultimately will be measured by the net impact the Global Compact has in the three areas and in promoting broader UN goals, above all poverty eradication and development.

The outcomes being sought in the short term are:

§ for the international business community to embrace the nine Global Compact Principles as part of corporate policy and practice;

§ engagement among Global Compact participants in policy dialogue to address and find solutions to challenges posed by globalisation – the role of business in zones of conflict is the first issue being discussed;

§ strengthening of the UN’s capacity to undertake partnerships based on shared values with the business community.

A learning forum has been set up co-ordinated by the Warwick University Business School where the individual case studies prepared by companies on their efforts to make progress in implementing the principles will provide the basis for what is hoped will be a successful sharing of experiences among participants and, together with complementary research findings, result in an information bank of “good practices.” At the same time it is important to bear in mind that, by promoting individual good practices, the Global Compact does not endorse companies, their products or overall performance

While one has confidence that initiatives like the Global Compact can help to build consensus and reach practical solutions to difficult issues, it is important to make clear that they do not imply that the role of government in ensuring respect for human rights has become less important. The High Commissioner has maintained the clear view that despite the increased influence of the private sector, primary responsibility for the promotion and protection of human rights remains with governments. Voluntary initiatives are no substitute for government action. At the same time, she has stressed that corporations should be aware of and responsible for the impact of their activities in the communities where they operate and be accountable for any of their own acts that lead to human rights abuses. I’ll come back to this point later in my remarks.

Promise or Perils of Partnership?

Let me acknowledge that great deal has been said about the potential downsides of the UN’s increased interest in partnership with the business community. Some have argued that risks for the organization associated with such activities include conflicts of interest and the unwarranted enhancement of corporations’ public image with the risk of tarnishing of the UN’s reputation. Others have contended that the partnership approach, based on voluntary principles, is part of a larger agenda which seeks to undermine the regulatory role of States and intergovernmental bodies. Some of our NGO colleagues have warned that the Global Compact will be used as a shield by businesses and their associations to avoid involvement in other UN approaches to dealing with business and human rights. These are good faith concerns.


The role of the UN human rights mechanisms

That is why we have found it important that other parts of the UN human rights system are also increasingly addressing the role of the business sector. For example, a growing number of Special Rapporteurs and Independent Experts appointed by the UN Commission on Human Rights to study specific human rights issues around the world have sought to enhance cooperation and contact with the business sector in the course of their work. The Special Rapporteur on the sale of children, child prostitution and child pornography focused this year on the role of the international business community in addressing human rights violations concerning children. The Special Rapporteur pointed out the role the tourism industry could play in combatting the growing sex tourism sub-culture which also has links to the terrible problem of trafficking in women and children.


Sub-Commission Guidelines relating to the human rights conduct of companies

A working group in the Sub-Commission on the Promotion and Protection of Human Rights is in the process of developing UN guidelines for companies which seek to comprehensively interpret business responsibilities under the Universal Declaration of Human Rights. The guidelines also stress the obligation upon both home and host States to regulate the conduct of third parties, which includes companies, with a view to protecting the human rights of individuals within their jurisdiction.

Of course, such processes raise challenging questions which still need to be resolved. Should such guidelines be legally binding or non-binding? Should they include issues such as privacy (to prevent genetic testing), family life, freedom of movement, right to vacations and social rights?

Some business representatives have argued for UN approved guidelines of high standards. Why? First, because increasingly, global business sees advantages in having standards that are applicable in all countries. Second, local companies supplying many customers on the international market are confronted daily with the demands of 30 or more codes, not all alike, and they lack the resources to respond. The argument that approval by the UN of one set of guidelines would give a level of authority which would make it the real standard and simplify and improve implementation. Even some business representatives have stressed that it was important to use the UDHR, or other treaty as a basis, since business and government needed to have the same ultimate reference point.

The Way Forward

In charting the way forward we could look at areas such as the following:


1. the role of the individual/employee/business leader
2. the role of individual companies
3. the role of industry sectors
4. the role of governments
5. the role of the United Nations


The Individual

Businesses are made up of people. The views of individuals within businesses on human rights issues will be crucial for how business goes forward. A corporate citizenship movement goes forward the role education – business education specifically – could play a crucial role.

Business ethics has traditionally been the preserve of philosophers who have focused on the role of the individual within the organisation and the ethical dilemmas that would be faced . But clearly the wider social and political issues will increasingly need to be part of business school courses on risk analysis, organisational behavior and strategic management.

The Company

There is growing consensus on what companies can do within their own operations which are central to making further progress. Concrete steps which a company could take to turn its commitment to human rights into actions include:

§ carrying out a human rights assessment of the situation in countries where they are or intend to do business to identify the risks of involvement in human rights abuses and the company's potential impact on the situation;

§ adopting explicit policies which protect the human rights of workers in its direct employment and in its supply chain;

§ ensuring that security arrangements, whether its own, contracted or supplied by the State, do not contribute to human rights violations;

§ establishing a monitoring system to ensure that its human rights policies are being implemented.

The Sectoral/Industry Level

I noted earlier the positive role sectoral initiatives can play in raising awareness about human rights issues and changing behavior. We see such developments in a growing number of industries from texiles to mining to tourism. For example, The Universal Federation of Travel Agents’ Associations drafted a Child and Travel Agents’ Charter, in which the members and affiliates, “mindful of the importance of their role in protecting the environment, people, countries and regions to which they send tourists, [pledged] to exercise the utmost vigilance with regard to such activities of their customers as are brought to their attention”. Signatories also pledged “never to promote or assist in the promotion of programmes, tours or travel whose purpose is the sexual exploitation of children”, and to “take care to inform their customers of the consequences to tourists of the sexual exploitation of children.

Governments

We must remember that governments play the central role in ensuring respect for human rights including through the regulation of business conduct. The recently adopted Protocol to Prevent, Suppress and Punish Trafficking in Persons, Especially Women and Children, supplementing the United Nations Convention against Transnational Organised Crime provides an example of how States parties are seeking to criminalize trafficking and related conduct, to strengthen border controls and to improve law enforcement responses to trafficking. This will clearly have an impact on State regulation of cross border private sector activities.

The International Community

There are still many difficult challenges for the United Nations to overcome as it develops its engagement with the private sector. How will an organization which in the past has been principally concerned with inter-state action, relate successfully to private organizations, which have different optics and working methods, either through or around governments. Are the techniques that have been used in the past by the UN to modify government conduct right for the private sector? Will the UN methods of drafting legislation and monitoring conduct work with the private sector? Do legally binding instruments change conduct, and how much? What are the techniques used today in relation to the control of corporate conduct on the national levels? New techniques have been developed in, for example, in the area of worker safety which set obligatory objectives and methods, but avoid command, control and inspection. Would they work in human rights?
How will the UN best be able to support companies efforts to do the right thing? The High Commissioner last week addressed a special meeting of the Security Council which discussed the Secretary-General’s report on civilians in armed conflict. The report notes the heightened interest in the scope of the responsibility of companies in their sphere of influence, including in conflict zones, and affirmed that the UN had a role in supporting companies in genuine efforts to avoid complicity in human rights abuses. This could be through information from UN human rights mechanisms or assistance in human rights impact assessments of projects in order to avoid the ‘unintended consequences’ of investment in zones of conflict.

As we go forward, there will be increasing attention by the human rights community to the behaviour of companies and the complaints will be expressed in the language of human rights violations. The Special Rapporteurs and the High Commissioner will be increasingly asked to comment on the corporate involvement of companies in human rights violations. The challenge for the UN will be to ensure that its own work can straddle a two track approach of dialogue/partnership and monitoring/compliance without compromising the work undertaken on either track or indeed the credibility of the organisation.

Allow me to leave you with an example of how the engagement track can contribute to the success of wider UN priorities. The main priority for the Office of the High Commissioner over the coming months is the World Conference against Racism, Racial Discrimination, Xenophobia and Related Intolerance which will take place in South Africa from 31 August to 7 September 2001. The problem of racism and xenophobia is clearly not going away. Intolerance remains at the heart of many conflicts around the world.

If the World Conference is to make a difference we must identify strategies that have produced positive results with a view to their being replicated. Business leaders care about the Durban Conference and the issues it will address because the strains and tensions in a society due to racism and other intolerance can negate years of costly investment. Because diversity itself can be a powerful motor for business success.

The High Commissioner has encouraged companies, trade unions and non-governmental organisations participating in the Global Compact to promote the World Conference and join the Secretary-General in Durban to address discrimination in the workplace, and the community at large, share best practices and make a commitment for the future. For it is only with the full engagement of all parts of society that racism can be effectively combated. And that is as much in the interest of business as every other member of society.

Finally, as we move forward, it will be critical that companies continue to take the lead in developing new forms of accountability and transparency. There can be little doubt that developing strong human rights policies and sound implementation strategies are key tests for corporations in overcoming increasing public concerns about globalization. But we should not underestimate the positive role business can play in shaping the future of human rights as well.

Thank you.