How events in Geneva could re-define the future of business

Ben Amunwa on 3 July 2015

The discussions of the UN Human Rights Council’s Intergovernmental Working Group (‘IGWG’) could result in a draft treaty to be proposed to the international community for ratification by States. The meeting in Geneva could set the tone of the negotiations as a final text is hammered out in the coming years.

This is the start of a new and potentially historic phase in the business and human rights (‘BHR’) field. The creation of an international treaty and the eventual enactment of legislation to enforce it are a long way off, but the talks could help clarify the human rights obligations of businesses, the role of states, and the rights and remedies for individuals at international law.


Background

Since around the early 1970s, international lawmakers have been concerned with the social and environmental footprint of modern-day transnational corporations. Corporate social responsibility (‘CSR’) has been an enduring, if at times divisive, feature of the global business agenda since the early 1990s.

During this time, regional conventions and courts have been developed to safeguard civil and political rights. However, the social, cultural and economic rights often infringed by industrial development have been largely left to voluntary principles and aspirations.

Despite numerous atrocities associated with business, (recall the collapse of the Rana Plaza garment factory, Bhopal, the extrajudicial killing of environmental activists in Ogoniland, and corporate complicity in the holocaust and apartheid in South Africa) existing legal structures in this area remain non-binding, cluttered with overlapping, vague, voluntary frameworks. To date, the question of whether international law should impose any direct obligations on businesses at all remains hotly disputed.


Breakthroughs and barriers

It will be a busy 4 days for the IGWG.

As much as negotiations are likely to be fraught with difficulty, there may also be opportunities to attempt to resolve some of the issues that have delayed progress on legislating for BHR for several decades.

High-level political tension exists between developing countries, some only too keen to divert attention from their own appalling human rights records to the western corporations investing in their territories, and western governments protective of the companies whose profits form a substantial chunk of their stock exchanges. (For its part, the UK made its position clear by voting against the creation of the IGWG, as did the US and a clutch of EU states).

The issue of whether the treaty should require civil remedies for the victims of corporate human rights abuses is an important one and raises a number of practical and financial problems, not least, how far States should be required to facilitate access to judicial remedies in an era of austerity.

This issue has come to the fore in the UK, where post-1 April 2013, the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (‘LASPO 2012’) has severely restricted the ability of civil claimants and their lawyers to litigate under conditional fee (so-called ‘no win, no fee’) agreements, by preventing the recovery of success fees and after-the-event insurance premiums that are essential to enabling some of world’s poorer claimants to sue multinationals effectively.

There are vexed issues of law too, (ably summarized in a helpful ‘white paper’ commissioned by the Law Society and American Bar Association here). They include the question of how to deal with conflicts between different jurisdictions. Where for example abuses occur in one state, the relevant business is hosted in another, or several other states, and the victim/s of
abuse reside in a third state, all of which might have jurisdiction under an international treaty.

In summary, lots of questions with no easy answers and plenty of options for the IGWG to explore as the draft treaty takes shape and exerts influence on the future of global business.

 

 

Posted by Ben Amunwa

Founder and editor of Lawmostly.com. Ben is a business and public law barrister with the 36 Group. He gives expert legal advice on employment, immigration and commercial disputes to a wide range of clients.

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