What tactics are available to practitioners beyond judicial mechanisms?

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What tactics are available to practitioners beyond judicial mechanisms?

Non-judicial and advocacy tactics: How have you used non-judicial mechanisms or other strategies in home states to hold companies to account for abuses abroad?  What obstacles have you faced? What victories have been won?  What role do consumers play?  What role do shareholders play?  How can communities affected by the human rights abuses participate and take leadership positions in these campaigns?Share your ideas, challenges, experiences, questions and resources below by adding new comments or replying to existing comments!

Consumer responsibility

I know many consider consumer boycotts a  "politically incorrect" strategy to force corporations to eliminate predatory practices that often violate human and labour rights.  Yet, it is a fact that every time consumer organisations or a coalition of citizen-driven organisations have mounted well documented campaigns against specific corporations, companies react at lightning speed to protect their image, which often materialises into actual changes to their practices. I argue this parting from the context of true democracy and from my belief that, given that governments are customarily co-opted by those who finance their electoral campaigns, there is currently no possibility whatsoever of making true corporate social responsibility a comprehensive, mandatory and sustainable business practice. Today, fundamental issues, such as living wages –which is a human right– are systematically excluded from CSR practice. Hence, the pursuit of an ethos that genuinely responds to the demands of society has to follow the logic of the market as another route to bring sustainable business practices from a human rights perspective. The power of consumers over corporations to stop harming people or the environment is far more likely to bring meaningful results –and at a much faster pace– than parliaments or multilateral organisations, which lack the political will or the power to establish a valuable CSR framework. In fact, corporations can become very competitive by securing consumer support, whilst enduring a consumer boycott can be far more costly than incorporating sustainable business practices.

The role of students and colleges

Thank you Kristin for your comments.  Indeed, students have played a critical role in forcing corporations to modify their unsustainable business practices.  Since the late 1990's students have acted as responsible consumers and citizens in an organised manner in the U.S.  Well-documented cases in the garment industry show how consumer campaigns developed by a network of college-student organisations of nearly a hundred universities in the U.S. forced companies such as Nike to, in turn, force in 2002 their South Korean suppliers in central Mexico to allow workers in several plants to remove corrupt company and government-backed unions and register their independent unions. This resulted in considerable gains in the labour endowments of workers in these in-bond plants. Very similar results have been obtained by this network in plants located in El Salvador, Indonesia, Sri Lanka and the Dominican Republic, which supply to Nike, Top of the World, Adidas, Disney, Old Navy and Gap among other brands.

The network, organised as United Students Against Sweatshops (USAS), USAS | Organizing for Student & Worker Power! works closely with the Workers' Rights Consortium (WRC), an NGO specialised in performing audits in all the plants that supply finished branded products to the corporations that sell their goods on these colleges’ campus stores. WRC was created by students, labour rights experts, and workers mostly in the South with participation from college and university administrators. The WRC's purpose is to enforce manufacturing codes of conduct adopted by universities, high schools, and school districts. Living wages is a prominent element of this movement. USAS’s aim is to make campuses sweatshop free. USAS believes that university standards should be brought in line with those of students, who demand as students and consumers that their school's logo is emblazoned on clothing made in decent working conditions. USAS has fought for these beliefs by demanding that their universities adopt ethically and legally strong codes of conduct, full public disclosure of company information and truly independent verification systems to ensure that sweatshop conditions are not happening.

Currently, with over 250 universities in the U.S. and Canada, USAS have expanded their campaigns to include ethical contracting and campus community solidarity. In the former they seek to expand the leverage they have obtained over licensing to other areas in which educational institutions do business, such as purchasing, contracting, and investing. In the latter they seek to establish permanent dignified labour endowments for all the workers on their campus, who are routinely exploited. In this way, USAS is challenging their universities’ administrations’ ethics in their business-to consumer as well as in their business-to-business relations.

The role of civil society in the public matter

Dear Hannah,  I agree with you that our role is not to act as a police force.  But several things have to be taken into account.  From my perspective, governments have systematically refused any type of legally-binding frameworks that would force corporations to ensure their practices are sustainable in the social, economic and environmental dimensions, including, prominently, a comprehensive respect for human rights in the business sphere of influence.  Governments keep insisting on allowing market mechanisms to regulate corporate practice.  As a result, there are, literally, dozens of CSR concepts which are all voluntary and allow corporations to cherry pick the standards where they look good and avoid those in which they have unsustainable practices.  They can actually cherry pick the voluntary standard in which they think they would look best.  

Moreover, consistent with the general position of States, multilateral organisations have also refused to implement any binding regulations. Any attempts to do this have been systematically blocked by States.  As a result, the OECD Guidelines for MNCs is only an incomplete and soft-law mechanism.  The OECD's National Contact Points, the only space where civil society can raise specific complaints against specific companies, does not work in most OECD member States, and when it does work it is not legally binding but only a recommendation. The UN Global Compact is a mockery of what CSR should be and an endorsement of laissez faire practices.   The work of John Ruggie, the UN's special representative for Business and Human Rights, consistently insists on "the States duty to protect", but does not favour a Universal legally-binding framework so that States can ensure corporate business practices are sustainable in a holistic manner.

Furthermore, I am parting from the context that the world is enduring an ethos in which the market has become an end in itself, replacing the real purpose of what democratic societies should be: the pursuit of the welfare of all ranks of society and, especially, of the dispossessed.  Consequently, although, indeed, there is no silver bullet and, thus, consumer responsibility cannot be the solution to our problem of making corporations observe sustainable business practices, I believe it is a viable tactic that has proven many times that it can exert immediate and positive reactions in corporations, because it uses the logic of the market.  Corporations' only goal is to perennially maximise shareholder value, with little regard for their so-called "externalities".  Therefore, when consumer behaviour is modified through effective and reliable information to favour corporations with less unsustainable business practices, those that judge themselves to be at a competitive disadvantage react immediately to address the issue.  Certainly, consumer activism is only effective with well known consumer brands, but that is a very important segment of all businesses; so why not use consumer activism to build a culture of socially and environmentally conscientious consumers?

Álvaro J. De Regil, Executive Director, The Jus Semper Global Alliance

Government and Civil Society Can Play Policing Role Together

Last year's DRC Conflict Minerals law (part of the Dodd-Frank Wall Street Reform Act) requires publicly-traded companies to file public reports with the SEC about what due diligence mechanisms -- if any -- they are using to ensure that their mineral purchasing doesn't trickle down to benefit abusive armed groups in conflict-riddled eastern Congo.  On its face, the law doesn't explicitly require any particular steps -- but just requires that whatever steps have been taken should be made public.  SEC filing requirements come with a certain amount of liability for company executives, thanks to the Sarbanes-Oxley law, providing more assurance that companies are truly transparent about their supply chain management.  These public reports then give consumers and responsible investors the information they need to make more informed decisions.  In this way, the government has made civil society's "policing role" easier -- by getting through that pesky first step of figuring out just what the companies are claiming to do.  [See more on the DRC Conflict minerals law, and new proposed legislation related to slavery and going beyond just eastern Congo, in the other thread: What new opportunities and new initiatives are arising for advocates?]

Government and Civil Society Can Play Policing Role Together

Thank you Karen for participating and for your contribution.  

The DRC Conflict Minerals law is certainly a valuable first step.  I assume the only thing consumers, investors and other stakeholders need to know on this issue is that companies have indeed declared that they do not do any kind of business with or import –through a third party– any minerals from the DRC.  To be sure, this only addresses some of the worst kind of human rights violations in a company's activity, such as outright slavery.  This brings to mind that a prevalent and very predatory violation of labour rights practice is customarily ignored and, thus, condoned by all States everywhere: the payment of misery wages.  In fact, the right to a living wage –endorsed in the Universal Declaration of Human Rights, is customarily not addressed in practically all voluntary CSR guidelines, despite the fact that the main motive for thousands of corporations to invest in so-called developing economies is to secure the lowest possible labour cost.  Therefore, with the full support of both their home countries and of potential host countries, corporations are free to roam the world in pursuit of the cheapest labour cost.  This is a critical issue with many negative multiplying effects on societies both North and South, and yet it is deliberately ignored by all States and many CSR practitioners.  This is one major reason, among others, I think we need to keep demanding the approval of a universal and comprehensive legally-binding framework, whilst, concurrently, until they actually fulfil our demand, use all sorts of non-judicial mechanisms, with consumer social responsibilty as a prominent one.

What is the role of unions in holding corps accountable?

cantabro wrote:

This brings to mind that a prevalent and very predatory violation of labour rights practice is customarily ignored and, thus, condoned by all States everywhere: the payment of misery wages.  In fact, the right to a living wage –endorsed in the Universal Declaration of Human Rights, is customarily not addressed in practically all voluntary CSR guidelines, despite the fact that the main motive for thousands of corporations to invest in so-called developing economies is to secure the lowest possible labour cost.  Therefore, with the full support of both their home countries and of potential host countries, corporations are free to roam the world in pursuit of the cheapest labour cost. 

Over the weekend, a friend of min told me a great story about how unions have been able to effectively hold corporations accountable for their human rights abuses in other countries - specifically with regard to low wages (as Alvaro raised in his comment above).  There was a company based in Scotland that owned a busing company that worked here in Minnesota.  This company did not let their employees unionize, did not give their employees healthcare and paid very low wages.  They also exploited their workers by hiring women on welfare because the company would receive tax breaks for one year (after the year they would find new employees on welfare in order to continue to receive the tax break).

The bus union (this company's competition in the city) saw what was happening and wanted to stop this company from undercutting the market (and hurting the jobs of the employees of the bus union).  The union decided to find out more about this company.  They found out that this company pays their staff in the United Kingdom much better than their staff in the United States AND those UK workers had the right to unionize. 

The bus union in the US decided to educate the employees of this company both in the UK and the US by coordinating exchanges between the staff.  When the unionized employees in the UK saw what was going on in the US they were outraged and demanded (through the UK government) that the company meet their human rights obligations in the US - and it worked!  The company was made to pay their workers in the United States a comparable wage to their staff in the UK and they were provided with benefits and rights. 

Are there other stories out there of the impact that unions can have on companies to uphold their human rights obligations in other countries? Unions have this great potential of cross-border collaboration -- has this potential been utilized?

The International Labor Organization has a great webpage with resources on international labor law. How has international labor law been utilized to hold corporations accountable?

Consumer and investor responsibility

Dear Chris, thank you for your participation.  Investor responsibility is becoming a rather important player, with a lot of leverage, in making corporations upgrade their business practices to make them sustainable in all three dimensions of their sphere of influence.  I was not aware about the passage of CA Transparency in supply Chains Act in the California Senate.  It looks like a very good starting point, so congrats!!.  I would have to say that to make it even more effective, there is a great need for the development of a CSR standard that all companies would need to use as a point of reference.  This is instrumental for both consumers and investors to assess whether the data provided by corporations objectively indicates that they are above or below the expected standard.  I know for a fact that there are critical elements of business practices that are not even address by most voluntary practices; the most prominent of all being the right to a living wage in the companies' home state and, particularly, throughout their supply chains.  Thus, stakeholders would need to agree on a comprehensive framework to assess a company`s performance that everybody can rely on.  Ideally, we would need a legally-binding framework that the State can enforce.

Regarding your question about the development of technologies to support consumer and investor responsibility, I believe that social networking can be one effective vehicle to disseminate information and talk about it, but not to produce information in a systematic manner.  To do this, we would need a centralised system that would follow a process to monitor the sustainability of a company`s business practices. I have a practical illustration of what I mean by this. Since 2007, I have been participating in an ambitious project to address this issue.  What the group has found is that, given that there is such a broad and diverse spectrum of tools to rate a company's sustainability performance, we would hardly be making any important contribution by adding another set of standards to be used by corporations.  So, gradually, the group has arrived at the conclusion that it needs to develop a set of standards (a Gold Standard) to rate the raters and the technology necessary to make information useful for all stakeholders: companies, asset managers, consumer organisations, governments… After years of learning and evolution in sustainability ratings, the group concluded that it is time for an independent, non-commercial initiative to move ratings into a new chapter to guide capital, consumer preferences, procurement and business-NGO partnerships toward companies that are true sustainability leaders and to steer underperformers toward a sustainability pathway. This initiative, the Global Initiative for Sustainability Ratings (GISR) is attempting to better understand the universe of external sustainability ratings with a view to influencing and improving the quality and transparency of such ratings.  The first step is to perform what the GISR has called the rate the raters research.  To accomplish the assembling and assessing of the current ratings landscape, the GISR is working with London-based Sustainability to use their "Rate the Raters" research project.  This will allow the GISR to move directly into designing a benchmark, "gold standard" ratings scheme.  A critical element of the design of the GISR is information technology.  Thus, the evaluation of alternative IT platforms will also be conducted, with an eye toward maximising the transparency of the GISR framework, soliciting comments from users, and fostering social networks to spreading awareness and uptake of the GISR framework.  The GISR envisions the IT platform to be completely transparent and fully interactive, so that stakeholders such as investors, consumers, asset manager and others can use and feed the system in addition to the actual rate the raters process. This is still at a planning stage, but we certainly feel that information technology will play a key role and social networks will make a huge contribution to spreading information.

 

Álvaro J. de Regil, Executive Director, The Jus Semper Global Alliance

Communities' Active Participation is important

Empowering communities to speak up about corporate human rights abuses is important in campaigns. But first, they must know their rights as individuals, and advocates play a major role in community education. Being able to articulate their issues themselves, and work together with other support groups in highlighting their issues is a crucial aspect that should be considered. While some campaigns are wages in home states, the struggles and resistance of communities and their voices of opposition against human rights abuses in their local areas are effective means to indicate the problems being brought about by non-compliance of human rights standards.

Participation in Voluntary Processes

There are also a number of voluntary processes that are addressing the nexus of business and human rights issues.  Civil society involvement in these processes is important for them to have any meaning.  For example, in the context of private security contractors (PSC), the public association of their activities with human rights abuses is one they are hoping to change.  Thus, the Swiss Department of Foreign Affairs has partnered with the Geneva Center for the Democratic Control of Armed Forces (DCAF) to support the development of a Code of Conduct (Code) that seeks to develop operational guidelines, and to establish international PSC industry norms and standards for the provision of private security services. 


The contract law based mechanism provided in the Code, as well as the call to build a “broader initiative to create better governance, compliance and accountability. . . [To] establish external independent mechanisms for effective governance and oversight . . .” does constitute a significant step forward in ensuring accountability over PSCs.  So too does the development of an independent auditing and verification system and the creation of a multi-stakeholder steering committee of six to nine members who will function as a “temporary board” and will be responsible for developing and documenting the initial arrangements for the independent governance and oversight mechanism.


The reality is that the legal system has not been receptive to cases brought against private contractors.  Even the most public of cases, including that against Blackwater guards for the shooting of 17 Iraqi civilians in Nisour Square, have resulted in dismissals in U.S. courts.  This culture of impunity extends across PSC activity as well.  On September 11th, 2009, the U.S. Court of Appeals for the D.C. Circuit in a 2 to 1 ruling dismissed a lawsuit brought against CACI International that alleged CACI personnel participated in torture and abuse at the Abu Ghraib prison.


The reality is, no matter how one feels about the privatization of warfare, the Code has the potential to be a definite advancement in building some accountability on this issue.  More than that, the Code and the companies that sign on to it are evidencing concern for the human rights at the core of their business practices. They have involved stakeholders, including civil society and governments, in the Code’s formulation, and will continue to involve these groups through the oversight mechanism created.

What is the potential of the Codes of Conduct?

Hello Amol and Alvaro - thank you for starting this discussion on the potential of the Codes of Conduct for businesses.  I found a great Ted Talk video with Auret van Heerden (labor activist and head of the Fair Labor Association) in which he explains the problem (the global supply chain) and makes the business case for fair labor and human rights (Codes of Conduct).  This video is helpful to better understand the complexity of the problem and the history/reasoning behind the Code of Conduct.

What do others think about the potential of the Codes of Conduct to prevent business-related human rights abuses abroad? Will it be possible, as Auret recommends, to create a safe place for NGOs and multi-national corporations to come together to define the problem and develop solutions?

What is the potential of the Codes of Conduct?

Hi Kristin,  Well, I am familiar with the work of the FLA and I do not agree with its vision, which is clearly conveyed by Auret VanHeerden.  He is clearly telling us to give up on governments and to actually submit ourselves to the will of corporations and to follow the logic of the market.  How come he doesn't address the obvious questions?: how come there is governments lack the political will to regulate the impact of business activity on the environmental and social dimensions?

Here is a brief assessment of his talk. First I think it is a major mistake to suggest that we can rely on voluntary codes of conduct, because we would be yielding to the power of the market. Second, there are literally dozens of codes of conduct, precisely because they are being developed through quid pro quo negotiations with corporations.  Third, this makes the spectrum of codes of conduct quite heterogenous, to the point that they end up competing against each other in a downward spiral to attract more corporations.  The logic being that the more flexible and less demanding, the more likely they will attract more corporations.  This is precisely what I meant before when I asserted that corporations really get to cherry pick the codes of conduct they like the best and discard the rest. They can even cherry pick the norms they like within a code of conduct and ignore the rest.  The best example is the GRI, which supposedly has become "the" most popular guidelines for CSR assessment and reporting.  At one point in time, the GRI offered two options to report: 1) in accordance and 2) completely flexible.  Later, they dropped the "in accordance" and now companies can report completely as they wish.  Fourth, who gets to define what is the proper standard?  Are they really addressing  all the issues or only the ones that are considered "acceptable" by the logic of the market?  Fifth, the last time I checked part of of the FLA funding came from some of the corporations participating on its scheme, which they also get to seat on its Board.  So how independent can a code of conduct be when it is mostly funded by corporations? 

Lastly, neither the FLA nor the GRI nor virtually any code of conduct that I know of addresses a fundamentally issue of corporate malfeasance that is systemic and pervading through the entire global supply chain: the right to a living wage.  The only code of conduct that I am aware of that has a living wage code is the ETI from the UK.  Yet it does not really define what a living wage should be nor provide a methodology to determine what a living wage should be for a particular job in a specific country.  In fact, the right to a living wage is a taboo issue among practically all stakeholders, but even more predominantly among governments, multilateral organisations, such as the ILO, the OECD and, to be sure, corporations.  The main reason all types of companies have moved to China, India and other countries of the sort is because they can pay miserable wages (about $1 an hour) to the workers in the supply chains and, thus, extract incredibly cheap labour costs that have nothing to do with the real cost of living in these countries.  This customarily violates, in a very grave manner, human rights and, thus, imposes on millions of people a meagre and undignified existence.  Many talk about "decent work" agendas, such as the ILO, or they declare the right of workers to just and favourable remunerations, ensuring for them and their families an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection. Nonetheless, the fact of the matter is that in practice they make sure that the right to a living wage is systematically shunned from any real standard.

In this way, I believe that it is a major mistake from conscientious and socially active citizens to envision any voluntary initiative to regulate the impact of business on human rights as "the" way to make corporations behave in a socially responsible and sustainable manner.  In the best case, we can resort to use civil society initiatives that are truly independent from corporate power as tools to exert pressure on corporations –through consumer and investors power– transitionally, while we concurrently work to force any government that regards itself as democratic to fulfil its most primeval responsibility: to procure the welfare of all ranks of society, and especially of the dispossessed, and not of the market, as is the case today.  My view is that if we succeed in making governments fulfil their basic responsibilities, CSR will cease to exist, it would become a moot point, for legally-binding legislation will take over and provide the right framework to control corporate malfeasance <FutureCSRMirrorSociety.pdf.

Thank you for the opportunity to participate,

 

Álvaro J. de Regil – The Jus Semper Global Alliance.

Business impacts on democratic rights

Dear Alvaro and all,

I strongly agree with you when you say “the public matter has been privatised and governments discussed it in private with the institutional investors, who are the actor truly in control the system.  In other words, we really do not live in democratic societies but marketocratic societies.”  

We rarely focus on this in our corporate accountability campaigns, but business-related abuses don’t only occur at the particular sites of business activity. They also manifest in the ways in which private interests and values influence public policy, law and authority. What sort of monetary policy is set, what type of health care is legislated, what political platform candidates will present are heavily set by private actors across so-called modern democracies, so much so that it is difficult anymore to distinguish the boundaries of the public from the private. Policy and regulatory capture by business is real in many sectors, and it strongly affects the degree to which a government is willing and able to act on civil society’s demands to hold companies to account. Private interests are more and more usurping or making impotent people’s democratic rights. This destroys the assumption that we are working with governments who have the society’s interest in mind, and forces us I think to recalibrate our campaigns in some important ways.

Do folks have stories or strategies to share which reclaim the state in the interest of human rights over private interests?

As our resident government representatives, I am interested to know from Chris and Djibril what sort of obstacle  business lobbies have played in Sacramento, and how you/your colleagues were able to sidestep them to breakthrough with the legislation you mention passed.

 

Business Impacts on Democratic Rights

Dear Niko,


Thanks a lot for your comment.  I agree with everything you wrote re regulatory and policy capture.  Djibril, as a staffer in the CA Senate, can speak to this more broadly (I'm a consultant, who works on public policy issues), but I can comment on our experience with the CA Transparency in Supply Chains Act.  That bill was opposed by the CA Chamber of Commerce, the CA Retailers, the CA Trade and Manufacturing Association, etc.  I think the composition of the legislature and the bill's author made a big difference.  The bill was authored by the Senate President, and he could hold his caucus together. It passed the Assembly and Senate on party-line votes, with Dems supporting and Republicans opposed.  However, it was signed by a Republican Governor.  I think the support of the socially responsible investment community made a huge difference; the bill could be characterized as providing information desired by a certain, and growing, class of investors, so they could better assess the investment risks associated with inadequate supply chain policies, i.e. there was a business case for supporting the legislation.  In addition, the baseline for compliance was raised from $2 million in annual sales to $100 million, removing the argument that it would impose costs on small businesses.  Also, I think the fact that it didn't have to go through the appropriations committee was crucial.  As you know, CA is facing a massive budget deficit.  A bill that would have cost the state money wouldn't have made it through the process.  Given the climate of austerity, I think this is important and potentially reveals a tactic that could be replicated: bills that require increased disclosure do not impose costs on states, and can also garner the support of the SRI community, undermining business opposition.  Finally, I was working as an Advisor to the Alliance to Stop Slavery and End Trafficking (ASSET) at the time, which is an anti-slavery NGO founded by Julia Ormond, the actress and former UNODC Goodwill Ambassador Against Slavery and Human Trafficking.  Julia is a very dedicated and intelligent advocate, and I think her participation in the process, including providing testimony at Assembly hearings and lobbying the Governor's office, made a real difference. For instance, she had access to the Governor that other organizations and advocates didn't have, and I think their common Hollywood background and experience and the PR possibilities her involvement presented made a big difference.  While I think that the other issues I cited were instrumental in getting the bill passed, I think it'd be a mistake to underestimate or discount Julia's influence. Anyway, getting back to the other issues,  I believe that legislation calling for increased disclosure of environmental, social, and governance (ESG) policies allow for the formation of diverse coalitions, and that the data such bills generate can be used by investors, consumers, etc, to exert more democratic influence over the private sector, through shareholder resolutions, or boycotts, if necessary.  I'd really like to hear people's thoughts on this, as we have an ally in Senator Corbett and other members of the CA legislature, and we might be able to get additional legislation introduced... According to various measures, CA is the 10th largest economy in the world, so legislation there can have significant extraterritorial reach and impact.


 


Chris 


      

ESG Disclosure and SEC Enforcement

Hi Chris,

I think the idea of wide ranging ESG disclosure is a good one and fits within the current understanding of what the state duty to protect and the corporate responsibility to respect should look like.  In fact, as the Special Representative has noted in reference to the State duty to protect, "encouraging or requiring companies to report on human rights policies and impacts is a key policy tool.   It enables shareholders and other stakeholders to better engage with business, assess risk and compare performance within and across industries.   Moreover, it helps companies to integrate human rights as core business concerns, supporting their responsibility to respect human rights."

The problem I see outside of the lacking political will for such disclosure is the capacity of regulatory agencies to monitor, oversee and engage in enforcement action.  As a study by the University of Arkansans revealed, 72% of companies failed to disclose on their filing forms that they had received sanctions the Environmental Protection Agency (“EPA”).   This is a clear violation of law as SEC Regulation 103 requires disclosure around pending or likely enforcement actions where the penalty is expected to exceed $100,000.   It also indicates that lacking enforcement by governments has the potential to plague regulatory advancements pertaining to human rights.

Thus, while expanding ESG disclosure is a valuable end from a human rights advocates perspective, we also need to be exerting pressure on our regulators to do their job.

I know ESG disclosures have been mandated in progressive European countries, at least for State-owned businesses.  How have regulators been there?

My submission to the SR on this mandating social and human rights reporting is available here, under 14th Session.

 

ESG Disclosure and Regulatory Evasion

Hi Amol,


Thanks a lot for your comment, and for including your submission to the SR.  I think your comment regarding enforcement is really important.  Using the CA example again, the duty to monitor compliance resides in the Attorney General's office, and I know a number of NGOs were going to try to meet with either the AG or the DAGs to convince them of the importance of their role.  Still, I'd be really interested in seeing the answer to the question you posed regarding regulators in the European countries that have mandated extensive ESG reporting.  And I'd also be interested in your thoughts regarding holding regulators accountable.  I recently read Matt Taibbi's latest piece in Rolling Stone regarding the SEC's unwillingness or inability to hold anyone accountable for the financial crisis and I think the performance of regulators is a crucial issue-- what good are laws if they're not enforced? Does anyone have any examples of effective advocacy related to the enforcement of existing laws? 

Regulating the regulators

Chris and Amol,

I agree with you both on the issue of regulatory failings. Its one of these really systemic issues, cutting across regulatory agencies in so many countries--from the SEC and the EPA as you mention, as well as similar failures of tax agencies to investigate fraud and tax evasion and the failures of DOJ to investigate corporate complicity in war crimes and torture--this all under the Obama Administration. I agree with your diagnosis that part of this has to do with resources and capacity constraints. But knowledge and power over information is also a key determinant I think, as public enforcers very often don't have the capacity to leverage the information they need to bring cases and to influence the media well enough to build the public support against powerful, white-collar wrong-doers. These challenges of course are greatly magnified for regulators in low-income countries, who not only lack the resources, capacity and power over information, but also have to deal with the fact that many of the large multinationals they are mandated to regulate could simply threaten to pull their operations, take the government to the ICSID - International Centre for Settlement of Investment Disputes, simply refuse to pay compensations, or lobby more powerful governments to exact punishments, for example through ending trade privileges, as is the case of Chevron.

There is no silver bullet to solving these problems, but the most effective advocacy to regulate the regulators--so to speak--has been a mix of strong, committed community groups teaming up with NGOs and the media--the fourth estate--to hand the concrete facts, arguments and actionable solutions to the regulators so that they have no other option but to act.

Beyond that, I also hold open some hope that well-meaning regulators in governments can work together across borders to end corporate abuse as part of their obligations to international cooperation, such as is happening to a limited degree on corruption, financial sector standard and international crimes. I would be eager to hear more from others on this, in particular if you are aware of other examples where well-intentioned goverment regulators are working together in different parts of the world to prevent and punish business-related abuses.

Business Impacts on Democratic Rights

Dear Chris, 

 

Glad to hear from you again.  I'd like to pose, for your consideration, getting in touch with Allen White, from the Tellus Institute in Boston.  Allen is the leader of the Global Initiative for Sustainability Ratings (GISR) that I mentioned on my previous reply to you.  I think there may be some good synergies between what you are trying to accomplish and the GISR's goal of developing an effective and reliable assessment tool that consumers and investors can use to make well-informed decisions.  The GISR is a project of Corporation 20/20; a broader project to transform business culture.  Allen's e-mail is awhite [at] tellus.org and the website is http://www.corporation2020.org/.

 

Álvaro de Regil – The Jus Semper Global Alliance

Corporate Control

Hi Alvaro,

Thanks for the comment.  I agree wholeheartedly that there is a need for legally binding frameworks for corporations vis-a-vis their environmental and social impacts (including human rights).  I do think this calls for a reorientation of the current business-first paradigm to a more people centered approach to our economy.  The kind of agreement you contemplate above could be just what is needed: a universal and binding instrument.  What are your thoughts on the political will for such an agreement, at the global level?  Would it be limited to a specific set of corporate activity (ie. activity in conflict or weak governance zones)?

Corporate Control

Thanks Amol for your comment,

The answer is straightforward.  There is no political will from governments to pass any type, whatsoever, of binding regulation to harness business activity and make it sustainable vis-á-vis the environmental and social (including human rights) dimensions.  In my opinion, as stated earlier, we do not enjoy truly democratic governments. On the contrary, they actually operate as market agents, they have privatised the public matter and they have transformed our societies into marketocratic societies.  I think it is now quite transparent that since all sort of corporate interests are free to finance the campaigns of their favourite politicians, they get to set the public agenda. In this way, I think it is almost impossible to construct a CSR legally-binding framework without first changing the rules of the game for how governments are elected.  We need to build a truly democratic ethos.  For more on all of this you can visit our project <www.jussmper.org>.  

Also, there is another project where we are indeed trying to change the current marketocratic paradigm to a people-centred paradigm.  We are targeting corporate culture and the whole thing starts with six principles of corporate redesign.  For more on this you can visit <www.corporation2020.org>

Alvaro J. De Regil – The Jus Semper Global Alliance

What Role for State Based Non Judicial Mechanisms?

CORE have done quite a lot of thinking about the potential role of state based non judicial mechanisms at the home country level in helping to improve corportate accountability.  Achieving effective access to justice in the host country is clearly priority, but problematic for a number of reasons, as outlined in a report we produced with The London School of Economics, The Reality of Rights.

In the home country, National Contact Points can play a useful role, particularly in union related disputes, but are far from functioning effectively, as OECD Watch regularly highlight. The potential role of National Human Rights Institutions at the home country level in business and human rights related disputes is also evolving. The NHRI's Biannual Conference last year was on this theme, and The Edinbourgh Declaration made some interesting suggestions about their role.   The NGO statement and other documents also provide some interesting ideas for the future and are available here.

CORE have also proposed the potential introduction of new mechanisms.  In the UK, this could be a new Commission, mandated to ensure UK companies adhere to Internationally agreed human rights and environmental standards.  It would clarify compliance standards for business - provide advice, take complaints - from whistleblowers and stakeholders, conduct investigations, support NHRIs and other related groups in the host country - and, importantly, have powers to penalise non compliant companies and provide remedy to victims.  More detail of our proposal can be found here and in our report Filling the Gap.

We also produced this recent report, Protecting Rights: Repairing Harm, on the role of  state based non judicial mechanisms in improving access to justice.  Be great to hear your thoughts.

Hannah Ellis, Coordinator, The Corporate Responsibility (CORE) Coalition

What Role for State Based Non Judicial Mechanisms?

Hello again Hanna, thank you so much for all your comments and valuable materials.  

I have glanced at them and they seem to address and attempt to answer very appropriate questions, particularly how can people have better access to inexpensive, effective and flexible mechanisms to resolve human rights disputes with business entities instead of resorting to court action.  I think one effective concept would be to create a State based institution –or an extension of a national human rights institution– that is specifically designed to provide a dispute resolution and redress mechanism for human rights violations by business entities, perhaps in the ways the papers that you are referring to propose.  They seem to be very plausible if there is the political will from the State. They would also need to be legally binding and would need to really have teeth to enforce standards and deter companies from breaching them.  

However, I am sure you are well aware that a major problem with national efforts to curve corporate malfeasance is that companies would move to less stringent or non regulated "havens" where they can feel free to go about their business with complete disregard for their so-called "externalities".  This would likely be the case unless the State makes a specific point to make companies based is such State responsible for ensuring that all their subsidiaries and their supply chains observe the same norms outside of its territory, which makes it all the more complex.  This brings me again to the same conclusion:  addressing corporate malfeasance comprehensively and effectively would require that all States agree on creating the same institutional edifice that would set the standards and the mechanism to enforce them and provide redress, in the form a universal and legally-binding framework, so that companies would no longer have any safe havens to go and continue operating with unsustainable business practices. In 2003 the Sub-Commission on the Promotion and Protection of Human Rights, under the UN Economic and Social Council (ECOSOC), approved a draft of the Norms on the responsibilities of transnational corporations and other business enterprises with regard to human rights; but The Commission on Human Rights put the draft in the trash bin under the pressure of key States, the International Chamber of Commerce and other corporate interests.  Yet, I believe we have to keep insisting at the international level and, concurrently, creating national entities just as the ones your papers propose. 

Hi Hannah, Thanks a lot for

Hi Hannah,


Thanks a lot for all your contributions and the links you've provided.  I have a question for you and the rest of the group: given the emphasis on austerity in the UK and US, including every US state, what kinds of legislation can we pursue that will not have to go through an appropriations committee?  The CA bill that I worked on last year, the CA Transparency in Supply Chains Act, didn't have to go through the appropriations committee, as the cost to the state was so small.  However, an earlier iteration of the bill called for the establishment of a commission, and that version was defeated, due to the modest cost to the state.  I think the experience with the last CA bill demonstrates that it's still possible to get meaningful CSR bills through a legislature, even in a climate of austerity and budget crises, but I think this makes our work much more difficult and I'd be grateful to hear everyone's thoughts on this. 

Climate of austerity

Hi Chris,  I think that the current crisis is here to stay for a long time and it should not be a deterrent to pass meaningful CSR legislation.  But I agree that is going to be harder. Thus, we need to be much more creative and with sharper and sounder arguments.  I think we have one strong argument in our favour.  The root of the problem that triggered the current crisis is a systemic one and it is centred on the sheer laissez faire unregulated business environment.  Therefore, a legally binding regulatory framework is urgently needed.  Yet, another systemic problem that needs to be address concurrently is the fact that governments have been transformed into agents of the market, and, hence, the laissez faire ethos.

Climate of Austerity

Hi Alvaro,


Thanks a lot for your response, and for introducing me to corporation2020 and Allen White!  I will definitely follow up on that lead.  As for the climate of austerity, the persistence of the crisis, and the common laissez faire ethos governing both the private sector and the government, I think you're absolutely right.   We should be sharpening our arguments and reminding people that this ideology is responsible for our current crisis and that there's a different way of doing business, that alternatives exist.  I'm hoping the assualt on collective bargaining rights in Wisconsin, Indiana, Ohio, etc, will lead to a larger discussion in the US, and that it won't be too parochial...

Mining, CSR and Latin AMerica

Dear All,

In Latin America the work of NGOs monitoring mining corporations' compliance with CSR is really difficult. To start with, the great majority of indigenous people directly affected by irresponsible mining practices are not consumers. They are self-sufficent, and function outside what we know as the cash economy.

The other issue is that with the exception of oil multinatiionals such as BP, Shell etc. ordinary junior mining corporations do not have a brand name to worry about as they change names often or are bought by a bigger company. Even in the event that a “non-regulated heaven” as Alvaro puts it decides to request compliance with what are very generous legal requirements, the companies reserve the right to disobey. This is the case in Guatemala of Goldcorp, a Canadian company, owner of the gold mine “Marlin” through its 100% subsidiary “Montana S.A”. On a yearly basis the company imports huge quantitiesof cyanide and so far refuses to pay import taxes. US$20,000 - the amount to pay - is negligible but the company just doesn't see the need to pay, and there is very little the government can do, as Montana is the single most important revenue source for the country.

This is just the tip of the iceberg. After years of being targetted by NGOs, a group of Goldcorp's investors decided to check for themselves how their money was used . The result is that some investors are now urging the company to develop better community relations with the affected communities. This is despite the fact that what the communities said they wanted was for the company to repair the environmental damage already caused and leave .

Furthermore, given the high number of HR abuses, last year the IACHR requested the government to suspend the operations of the company . The only thing that has happened is that in January this year Montana anounced an increase in their production. As Alvaro says, companies are able to cherry-pick what they like in relation to CSR, and in this case Montana has decided not to report on the violent conflict that has torn the communities affected by the Marlin Mine . If you read the Annual Report there is not a single entry for the conflcit, and yet the communities rate the conflict as the most important issue arising as a result of the presence of the mine within their territory .

In Latin America mining corporations do not move to other less pushy governments. They stay where the mineral is found . Why should they move to another “heaven” when they have the power to make governments adapt to their company's needs through international courts which allow the company to get away with negotiations? Invoking the CAFTA agreement “Pacific Rim” has requested in the US  nothing less than US$ 100 millions for compensation from  El Salvador, arguing potential loss of earnings and violations of their investors ' rights .

I agree with Niko. There are a host of issues that NGOs do not discuss and the fact that - north and south -  corporations are embedded within governments and political elites is one of them. I have used two corporate examples that illustrate the dangers of pursuing instruments that only scratch the surface and he OECD is one of them.

Any comments on how we deal with this situation? To me it is linked to credibility with the millions of people suffering buisiness-related abuses, and is one of the most important challenges facing NGOs .

--

Int'l Fed of Chemical, Energy, Mine and Gen Workers Unions

Hi Glevys,

Thank you for sharing these challenges facing NGOs in Latin America (and everywhere).  I wonder how you think unions might be able to help you in this situation.  The problems that you highlight in your comment are many and there are many different targets and audiences, as well.  I know that unions want to protect their workers but I wonder if that could also have a positive impact on the communities where these companies work?

Are you familiar with the International Federation of Chemical, Energy, Mine and General Workers' Unions (ICEM)? They bring together unions all over the world to have a bigger impact collectively on workers' issues.  Here is some information I found on their website:

How can workers face up to the might of the global corporations? By organising globally. That is why more than 20 million workers worldwide are already members of the ICEM, the International Federation of Chemical, Energy, Mine and General Workers' Unions. The ICEM is a rapidly growing industry-based world labour federation dedicated to practical solidarity. It unites trade unions in its sectors on all continents. Its aim is to become a truly global trade union.

Its main focuses are:

  • negotiating and monitoring global agreements with multinational companies - mainly on workers' rights, equality at work and the highest standards of health, safety and environmental protection worldwide
  • networking trade union reps within global corporations
  • coordinating solidarity and support for member unions during disputes
  • union-building in countries where unions are weak or non-existent
  • providing information and expertise on topics ranging from collective bargaining to health and safety standards
  • representing workers' interests within the UN, its agencies and other intergovernmental bodies
  • skills training and development work with trade union officers and rank-and-file union members.

ICEM helped to bring together Xstrata (a Swiss mining company) unions in 2008 from six countries - they decided to start an International Solidarity Fund and to create a Global Council of Xstrata unions.

I added a different comment regarding unions and the impact that unions can have on increases wages for workers in other countries.  I thin kthat the issue that you are addressing in your comment is different in that you are focusing on the communities -- but is there a connection? What is the connection? Has this connection been utilized in other campaigns?

Leveraging the Money - influencing financial institutions

The New Tactics project has a great case study that shares the strategy of the FoodFirst Information and Action Network (FIAN) in Germany to influence large mining operations that were causing human rights abuses in Ghana by putting pressure on banks and other financial institutions that invest in those mines. The tactical notebook outlines the step by step process of, Leveraging the Money: Enforcing human rights by influencing financial institutions

Have others "gone to the source", so to speak, by seeking to influence or cut off the source of funds from the banks providing the required funds needed by large mining operations to continue?

Non-Judicial Approaches - Some Initial Thoughts

Newbie here, from a Quaker peace project located next to Fort bragg. We have many torture connections in this area, and have been active for five-plus years in tgrying to bring them to public notice and evoke some kind of official response and accountability.

We've done pretty well at raising the issue in various ways; but so far we've run into a solid wall of stonewalling by all the public and corporate officials we've dealt with. We're not giving up, but that stonewalling is the ongoing context for our work.

I was at the New tactics seminar in DC about torture last September, and was bemused to hear from the top-level experts who spoke with us that in DC currently, just about every "official" avenue for seeking accountability is likewise currently closed down: the courts are locked behind "states secrets" claims; Congress is bought off; and the Administration, after throwing a couple of crumbs, has completely affirmed the policy of denial and impunity.  

It was dismaying to see so many DC practitioners survey this bleak landscape and then say, in effect, "Well, we'll just keep doing what we've been doing, only more so." Perhaps because I was from a provincial small group in NC, it was more possible to say, "When all the boxes are locked, maybe it's time to think outside the box?"

Here's how we're trying to do this: my familiarity with other socieeties where torture regimes have held poer and then been forced to yield suggests that when the perps and their henchpeople leave office, they do their best to wrap themselves in impenetrable layers of impunity. They also work hard to get their publics to forget what has happened; "look ahead, not backward," etc.

Then civil society and human rights groups go to work on the successor government(s) to wear holes in these walls, and reach through them. They also aim to thwart the "forced forgetting" of what has happened.

This "Interval of impunity and denial" and the struggle to break through it can last decades. It was ten years after Pinochet left office that he was put under house arrst in London; etc.

It seems to me that we are now in the US "Interval of Impunity and Denial," and all our major governmental institutions are deeply complicit with it.

So, what is to be done in this period? I can only answer for myself: I'm not a lawyer, so I can't sue anyone. I don't command a large staff or budget, so mounting a national/international effort is out of reach.

What's available to me are opportunities to speak up against the "forced forgetting," via the various media available: from print, to protests, to personal presentations to responsible bodies.

Here in NC we have been pretty busy pursuing a wide range of ways of speaking up; and I think we can claim some success in keeping the issue of torture, and its NC connections, in the public discussion here, whereas major institutions would like to it be shoved down the memory hole.

While we continue to do this, institutionally "bigger fish" will, I hope, find aways to batter through the walls of impunity and begin actual accountability actions. Such work is "above my pay grade," as they say here; I wish them well, but do not have high hopes for early results.

The key element in our work here will be whether we can sustain it for as long as needed. This is tough; American activisitgs often show the characteristics of other US consumers, and get bored with an issue, wanting to move on to new causes. Our five years of work is remarkable in that respect.

If we have something to offer others, I suggest it lies more in the focus on resisting the "forced forgetting" that the American public is being subjected to. The more original and daring ways to bring the issue to light in various contexts that are employed, the better chance we will have. For me, this points to a lessened focus on DC; not only are the official levers inoperative, the media there have shown clearly that this issue is "not news." 

Yet the tentacles of torture reach very widely in our society, and take many forms. One example: I have been stunned by the presentations by psychologists about how deeply their profession has been suborned and corrupted by the developing torture machinery. There are other professional groups where similar issues coud be raised, as well as various parts of the country with connections of complicity like those here in NC. Again, the key variable will be imagination and daring, as wellas doggedness.

I wish us all well.

 

 

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