By Jerome Bellion-Jourdan
Senior Fellow in Residence at the Global Governance Centre
The Graduate Institute
Synopsis: Getting traction towards a legally binding instrument to regulate the activities of transnational corporations and other business enterprises would require consensus-building. In the meantime, much remains to be done to implement the UN Guiding Principles on Business and Human Rights.
Keywords: Human Rights Council, UN Guiding Principles on Business and Human Rights, human rights, transnational corporations, negotiation
“It is on us all to work to reach the highest level of consensus possible and to culminate with a successful negotiation of an international instrument that reflects the aspirations of the whole international community. For that great challenge, I urge all countries to participate in the process”.
These were among the closing remarks of the Chairperson-Rapporteur at the 5th session of the United Nations (UN) Human Rights Council Intergovernmental working group, which met on 14-18 October 2019 in Geneva. The Intergovernmental working group is mandated to elaborate an international legally binding instrument to regulate, in international human rights law, the activities of transnational corporations and other business enterprises. The following are some of my personal impressions – as an observer and no longer as a negotiator – based on the proceedings that took place in Room XX at the Palais des Nations web streamed on UNTV, parallel events and informal discussions with diplomats and other stakeholders in the corridors.
Behind the scene, the question on many lips was: is this just another round in a so-called “treaty process” or are these genuine negotiations? Many felt that the 5th session suffered from a similar fate to the 4th when a first draft was presented, that is a format of expert presentations followed by reactions from States and other stakeholders, but not a proper negotiation.
Some expected that the changes introduced by Ecuador in the revised draft presented to the 5th session may trigger a new dynamic. Two such changes were particularly noticed as there was much attention to these issues since Human Rights Council resolution 26/9 established this Intergovernmental working group in 2014. The first is the draft’s preamble reference to the UN Guiding Principles on Business and Human Rights, which is meant to signal that the new legally binding instrument would be in line with this authoritative framework carefully crafted by Special Representative of the UN Secretary General John Ruggie and endorsed by the UN Human Rights Council in 2011. The second is revised language on the scope of the instrument that appears to respond to the demands from some States and other stakeholders that the new instrument should not be limited to “transnational corporations” and could cover all business companies.
However, these and other changes in the revised draft did not significantly affect the overall dynamics and the paradox of an inter-governmental process lacking traction from States. Some States, including the US, Canada, Australia, Japan, and the Republic of Korea, were not in the room. Others, such as China and the Russian Federation, maintained a critical view of the draft or the very objective of negotiating a new instrument. A few, including South Africa (co-sponsor of the process with Ecuador), Cuba and Venezuela, reiterated their principled support to the process and its objective, while others engaged mainly to request clarifications. The European Union participated without a formal mandate to negotiate, thus disappointing those who expect the EU to lead and bring a critical mass of States to the table. Will the new European Commission, coming to office in December 2019, take a different approach? The answers by Commissioner-designate for Justice Didier Reynders in his hearing before the European Parliament fueled expectations for European legislation on the duty of vigilance, but the question remains: if this materializes, would it be accompanied by a proactive support for a legally binding instrument at the international level?
“… some question privately the real intentions of the States pushing for a treaty.”
In contrast to the overall reluctance from States, civil society continues to be a driving force for a legally binding instrument, with hundreds of organizations united under the “Treaty Alliance” network. They include organizations that represent communities directly affected by abuses related to business activities, advocate against the negative impact of globalization, and promote human rights protection. All have come with high expectations that a legally binding instrument negotiated at the UN would address the current gaps in the prevention of abuses by business entities, and access to remedy when abuses occur. As the years pass, in addition to the lack of political will from States to enter in negotiations, some question privately the real intentions of the States pushing for a treaty.
Against the background of failed attempts to deliver legally binding norms since the 1970s, some fear that the discussions in this Intergovernmental Working Group could drag on for years without any result, or that it would result in an instrument that would be viewed by many States as unacceptable and impossible to implement. The polarization around the elaboration of new legally binding norms is also present in other areas, such as the “right to development”.
As we will shortly mark the 100th anniversary of multilateralism since the establishment of the League of Nations, and with multilateralism increasingly questioned, there is a need to reflect on next steps, if only to avoid disillusionment. A concrete way forward would be to invest intensively in consensus-building to identify common grounds among all States, those in the room and those outside the room. This would probably require engagement behind the scene to look candidly at the blockages: does the reluctance from States have to do with the current process, with the prospect of agreeing on any legally binding instrument, or with the draft currently on the table?
Building consensus also requires understanding perceptions from all sides to build trust. One such perception, deeply rooted in some circles, views “business” as intentionally involved in harmful activities. An exchange in a parallel event at the Palais des Nations illustrates the matter. Reacting to a civil society representative painting a simplistic picture of business, a business representative of Novo Nordisk recalled that “it is not true that all evil people go to business and all good people go to civil society” as many work in business with good intentions. Similarly, there is a perception that “business” is opposed to legally binding norms. Some business organizations, such as the International Organization of Employers, have expressed concerns about the current process and draft, but the picture is more complex. In private, and increasingly in public, we hear business voices in favor of regulation as long as it is effective and levels the playing field. Novo Nordisk has, for instance, come out in favor of mandatory due diligence.
While much remains to be done to build consensus around a possible legally binding instrument and agree on the best format for future negotiations, there appears to be consensus among States, business and civil society for swift action to prevent abuses and ensure access of victims to effective remedy. Without waiting for a new instrument, the UN Guiding Principles on Business and Human Rights allow for a smart mix of regulatory and voluntary measures under the three pillars: “the State duty to protect” recalling the existing obligations of States; “the corporate responsibility to respect” and “access to remedy”. The forthcoming UN Forum on Business and Human Rights on 25-27 November 2019 will be yet another opportunity to take stock of progress and challenges.
More broadly, while discussions around a legally binding instrument continue, much more can be done, in particular to better connect Business and Human Rights with the Agenda 2030 and with efforts to address wider global issues, such as inequalities and tax evasion; all this under the ticking clock of climate change.
The last two speakers, Peter Sorensen, Head of the EU Delegation to the UN in Geneva and Riccardo Serri, EEAS Division on Human Rights, restated the EU’s commitment to protecting human rights and contributing to the process of developing international regulations. Mr Sorensen added that the EU went to the IGWG meeting in Geneva with the primary but non-exclusive focus of supporting better UNGPs implementation. He concluded with saying that he hopes future UN Treaty consultations will be based on cooperation and overcome initial hurdles.
The limited scope adopted in the process and in the published draft has been a matter of contention since the start of the process. The scope obviously impacts on the reach and consistency of several sections and articles of a draft treaty whose focus is on the definition of grounds of legal liability for businesses (mainly civil and criminal) and access to remedy and reparation by the alleged victims of company abuse. Its disruptive effects can be seen for instance in the definition of corporate criminal offences that States Party are required to enact domestically. Under the current scope and definitions only criminal conduct (no matter its seriousness) that occurs in more than jurisdiction may be punishable, which may lead to the absurd outcome that egregious criminal conduct (for instance crimes against humanity) may not be punishable if committed by businesses acting only within one jurisdiction. The offences established in accordance with article 10.8 of this Convention shall be established in the domestic law of each State Party independently of the transnational nature of the business activity, except to the extent that the nature of the crime would require the transnational element.