Regulating Business and Human Rights Across Borders

By Jinny Kim

With the spread of globalization and the rise of multinational business, the adverse impact of corporate actors on human rights has been the subject of increasing attention. For Canadians, the deaths of over 1,100 Bangladeshi workers making Joe Fresh garments in a horrific factory collapse in 2013 brought these concerns front and centre.[1] In Ontario, a case concerning the murder and rape of Mayan villagers in Guatemala by security forces allegedly under the control of Canadian parent company HudBay Minerals Inc. has been ongoing since 2010.[2] As more corporations expand their operations internationally, there is a growing need to supervise their actions, and actions which may be attributed to them, so as to prevent human rights abuses and enable victims to seek redress.

In 2011, the United Nations Human Rights Council endorsed the UN Guiding Principles on Business and Human Rights (UNGPs).[3] The UNGPs set out the “Protect, Respect and Remedy” framework, which consists of the state duty to protect human rights, the corporate responsibility to respect human rights, and the right to a remedy for victims of human rights abuses.[4]

The UNGPs have received significant support from the private sector. [5] According to a 2014 survey of senior corporate management from around the world, a “large majority of executives now believe that business is an important player in respecting human rights, and that what their companies do – or fail to do – affects those rights.”[6] Over 80 percent of the respondents saw human rights as a matter for both businesses and government, while 71 percent said their companies’ responsibilities went beyond simply complying with local laws.[7]

While some regard the UNGPs as having created a positive change in corporate actors’ approach to human rights, others remain concerned about their non-binding nature.[8] In response to this concern, the governments of Ecuador and South Africa drafted a UN Human Rights Council resolution calling for a legally binding international instrument on transnational corporations and human rights.[9] In June 2014, this resolution was adopted by the UN Human Rights Council.[10] It creates an open-ended intergovernmental working group (IWG) with the mandate to negotiate a binding treaty on transnational corporations and other business enterprises that operate globally.[11] Thus far, there have been two negotiation sessions.

The most recent session was held in October 2016. Member states, intergovernmental organizations, NGOs in consultative status with the UN Economic and Social Council, and several other groups engaged in comprehensive discussions on the potential treaty. Many NGOs agreed “that any binding instrument must clearly establish the obligations of transnational corporations to comply with environmental, health and labour standards and international humanitarian law.”[12] Also discussed was the need to bolster the remedy component of the UNGPs to include “the right of individuals and affected communities to access to justice and include provisions for the accountability of parent companies, protection of human rights defenders and the right to self-determination.”[13] The session’s keynote message highlighted the need for a binding treaty on the grounds that transnational corporations can often be more powerful than governments. A treaty with the power to hold corporate actors accountable could help to “strengthen the capacity of [governments] to ensure remediation.”[14]

The first two working group sessions were “dedicated to conducting constructive deliberations on the content, scope, nature and form” of the potential treaty.[15] The Panel discussions from the latest session indicate that some of its main themes were: 1. the scope of the state’s duty to protect human rights, including extraterritorial obligations; 2. the types of human rights violations that will trigger corporate liability; 3. which transnational corporations and business enterprises will be overseen by the Treaty giving consideration to the complex corporate structures of today; and 4. the interactions between domestic and international laws in providing victims with appropriate remedies, among others.[16] It is hoped that in the result, the Treaty will lead to effective oversight of Canadian transnational firms and their subsidiaries, as well as ensuring that victims of business-related human rights abuses have access to suitable remedies.

[1] Matthew McClearn,“Global Report: The Uncomfortable Truth about Bangladesh; Loblaw had Plenty of Warning”, Canadian Business, (6 June 2013), online: <http://www.canadianbusiness.com/global-report/global-report-loblaw-and-the-uncomfortable-truth-about-bangladesh/>.

[2] Marina Jimenez, “Mayan Families’ Quest for Justice against Canadian Mining Company HudBay”, The Star (20 June 2016), online: <https://www.thestar.com/news/world/2016/06/20/the-mayans-vs-the-mine.html>.

[3] Guiding Principles on Business and Human Rights: Implementing the United Nations ‘Protect, Respect and Remedy’ Framework, HRC Res 17/4, UNHRCOR, 2011, UN Doc A/HRC/17/31.

[4] Ibid.

[5] Paul Kielstra, The Road from Principles to Practice: Today’s Challenges for Business in Respecting Human Rights (The Economist Intelligence Unit 2015).

[6] Ibid at 4.

[7] Ibid.

[8] Republic of Ecuador, Statement on Behalf of a Group of Countries at the 24^th Session of the Human Rights Council, UNHRCOR, 24th Sess, (2013).

[9] Ibid.

[10] Elaboration of an International Legally Binding Instrument on Transnational Corporations and Other Business Enterprises with Respect to Human Rights, HRC Res 26/9, UNHRCOR, 26th Sess, UN Doc A/HRC/RES/26/9, 2014.

[11] Ibid at 2.

[12] Report on the Second Session of the Open-ended Intergovernmental Working Group on Transnational Corporations and Other Business Enterprises with Respect to Human Rights, UNHRCOR, 34th Sess, UN Doc A/HRC/34/47 (2017), at 6.

[13] Ibid.

[14] Ibid at 4.

[15] Ibid at 3.

[16] Ibid at 9-22.