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Environment Magazine September/October 2008


May-June 2009

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A Point of Departure in Muddy Waters

The popular demand for corporate responsibility in the wave of the recent economic downturn has focused largely on business ethics, although other strands—corporate social responsibility, corporate environmentalism, and sustainable development—have also figured strongly in discussions on the interactions between corporations and society. Yet an increasingly prominent debate focuses on businesses’ responsibility to uphold a core component of all these concepts: human rights. The 2008 report of the Special Representative of the UN Secretary-General on the issue of human rights and transnational corporations and other business enterprises, Protect, Respect and Remedy: A Framework for Business and Human Rights, entered the stage at a crucial point in this debate.

Seeking a fundamental platform for business ethics, Wharton  Business School professors Thomas Donaldson and Thomas Dunfee describe the rights specified in the 1948 Universal Declaration of Human Rights as the “best accepted and most widely promulgated candidates for universal norms.” Yet the concept of human rights is potentially more than just a moral framework for voluntary corporate citizenship; it is also closely linked to a strong tradition of international and national law. Historically, human rights have been conceived in terms of individuals’ or groups’ freedom from abuse or arbitrary action by their rulers. In the Western tradition, the English Magna Carta of 1215, which constrained the King of England’s powers (for instance, to unlawfully imprison his subjects), stands out as an important early example formalizing such rights. The contemporary bedrock of human rights law is the International Bill of Human Rights, which was established by the United Nations (UN) and consists of three parts: the Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights, and the International Covenant on Economic, Social, and Cultural Rights.

One important aspect of the emerging business and human rights agenda is the extent to which international human rights law is applicable to private-sector companies. Some legal scholars argue that the Universal Declaration is applicable only to the UN member states. But Louis Henkin, an influential former president of the American Society of International Law, articulated a counterargument that many others have adopted, based on the Universal Declaration’s preamble: “‘Every individual’ includes juridical persons. ‘Every individual and every organ of society’ excludes no one, no company, no market, no cyberspace. The Universal Declaration applies to them all.”

An early initiative to formalize some sort of application of international human rights law to the private sector was the 1990 draft UN Code of Conduct of Transnational Corporations, but it did not achieve any formal status. In 2003, the UN Sub-Commission on the Promotion and Protection of Human Rights published the Draft Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights (often referred to as the Draft Norms). The Draft Norms assigned far-reaching responsibilities for promoting and protecting human rights to companies, with emphasis on particular human rights, such as nondiscrimination, security of persons, and rights of workers. Acrimonious debates ensued, as business representatives and many governments argued that human rights responsibilities normally attributed to states should not be extended to the private sector. When the Draft Norms failed to become formally adopted, the UN Commission on Human Rights established the position of the Special Representative of the Secretary-General on the issue of human rights and transnational corporations and other business enterprises, with the incumbent John Ruggie mandated in 2005 to provide an overview of international standards and practices, as well as his views and recommendations. The final report of his first three-year term has done much to create a common point of departure in these debates, especially considering the hostility surrounding previous proposals.

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