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FOCUS December 2018 Volume 94

International Trend Towards Eradication of Human Rights Abuses in the Supply Chains

Takeshi Shimotaya

Currently, human rights abuses by transnational businesses continue to occur. In order to stop the abuses and to make businesses take appropriate actions respecting human rights, development of international standards and enactment of domestic legislations related to human rights have taken place. As an international standard, the United Nations (UN) adopted the “Guiding Principles on Business and Human Rights: Implementing the United Nations ‘Protect, Respect and Remedy,’ Framework” (UN Guiding Principles) in 2011 which states and businesses should follow. The amendment of the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises in 2011 and the issuance of "ISO 26000" as the international standard on corporate social responsibility in 2010 affected the preparation of the UN Guiding Principles. In recent years, with these international standards, called soft law, having been established, businesses have been required to voluntarily undertake human rights activities. However, alongside these activities, use of binding treaties and enactment of new domestic legislations have become the trend.

United Nations Binding Treaty
The development in the UN of binding human rights instruments remains a big international trend. Aiming to eradicate the human rights abuses of transnational corporations, the Human Rights Council adopted Resolution 26/9 in June 2014 to establish “an open-ended intergovernmental working group on transnational corporations and other business enterprises with respect to human rights.” Discussions about a binding treaty have been ongoing since 2014. The so-called "Zero Draft" of the draft treaty was published in July 2018 and then submitted to the United Nations High Commissioner for Human Rights.

The draft "Norms on the responsibilities of transnational corporations and other business enterprises with regard to human rights" adopted by the UN Subcommission on the Promotion and Protection of Human Rights in 2003 was discussed by the experts of the Human Rights Committee for potential ratification by the states that would help them impose human rights obligations directly on businesses. But there was a  huge gap between the businesses and human rights-related organizations and activists on what such “Norms” should be, and support from UN member-states could not be obtained. As a result, the UN Commission on Human Rights at that time did not express any opinion and intention about it. Against the background of the failure to adopt the “Norms as a treaty,” Professor John Ruggie of Harvard University was appointed as Special Representative of the Secretary-General of the UN in 2005 in order to tackle “the issue of human rights and transnational corporations and other business enterprises." Thanks to Ruggie’s holistic and systematic research, the UN Human Rights Council adopted the UN Guiding Principles in 2011. The UN Guiding Principles worked as the core international business and human rights framework that states and businesses have acted upon, but only on a voluntary basis up to now.

Since the UN Guiding Principles promotes voluntary efforts by states and businesses, it cannot be enforced. It has been pointed out that the actions of states and businesses have been very slow since the adoption of the UN Guiding Principles in 2011. Based on this background, some states (such as Ecuador and South Africa) have raised the issue of human rights abuses by transnational corporations and took on the role of core countries that have proposed the adoption of a legally binding instrument on business and human rights. After this, the United Nations Human Rights Council adopted Resolution 26/9 in 2014 “to establish an open-ended intergovernmental working group on transnational corporations and other business enterprises with respect to human rights, whose mandate shall be to elaborate an international legally binding instrument to regulate, in international human rights law, the activities of transnational corporations and other business enterprises.” These movements are aimed at making states and businesses comply with the international law on human rights.

The open-ended intergovernmental working group under Resolution 26/9 has been meeting on the drafting of an international human rights treaty. The working group held four meetings since 2014 discussing the scope, form and contents of the treaty. The Chair of the working group, the delegation of Ecuador, made public in July 2018 the "Zero Draft.” The "Zero draft" focuses on "business activities of a transnational character," rather than those of all companies. It also features a stronger obligation for countries that ratify the treaty to prevent human rights abuses arising from corporate activities and to ensure justice and access to remedy for victims. Some members of the civil society were concerned that the "Zero Draft" did not include many of the important points from the "Elements" document presented in 2017. At the fourth session of the working group held in October 2018, these important points were discussed as necessary in any international legally binding treaty on the issue. 

Enactment of Domestic Legislations
Domestic legislations on human rights are being enacted in a number of countries, independent of the trend of using legally binding treaties. The Dodd Frank Act Section 1502 in 2010 in the United States (requiring listed companies to report the existence of conflict minerals in their supply chains), the California Supply Chain Transparency Act in 2012 (requiring companies to check their direct suppliers on how they tackle the eradication of slavery and trafficking and to report their activities on their website) and the revision of the United Kingdom (UK) Company Law in 2013 (forcing listed companies in the UK to provide information on human rights in their annual reports) have been implemented. Based on the UK National Action Plan (NAP) that was adopted in accordance with the UN Guiding Principles, the UK "Modern Slavery Act" (requiring identified companies to report the procedures to identify and eradicate modern slavery on their supply chains) was enacted in March 2015. In addition, recently, the Australian Modern Slavery Act was enacted on 29 November 2018 and would enter into force from 1 January 2019. In France, the duty of vigilance law requiring companies to check their supply chains was enacted, and failure to comply with the required procedures would incur penalties for the companies. In the Netherlands, the Child Labor Due Diligence bill is under discussion but it plans to have the law enter into force from January 2020. These cases show a trend on enactment of national laws on business and human rights in countries that have adopted the NAP. The European Union adopted the conflict minerals regulation in March 2017, which will enter into force as EU Regulation from January 2021.

Reflections on the Trend of Binding Treaty Adoption and Domestic Legislations Enactment
Currently, the adoption by the UN of a binding treaty on business and human rights faces a number of issues:
The treaty-drafting process takes a long time;
The process of adopting a binding treaty and the promotion of UN Guiding Principles complement each other, thus discussions have been directed toward connecting the two processes;
The binding treaty should cover not only transnational corporations but all companies including domestic ones;
While discussion on the binding treaty continues, a state should have a NAP in accordance with the UN Guiding Principles and make it work;
National laws on human rights issues (e.g., Modern Slavery, Conflict Minerals, etc.) create mechanisms that require businesses to take action on human rights;
Businesses that have not implemented the UN Guiding Principles should start taking action, while those that already have implemented it should continue to make efforts and ensure that their system works well.

At present, globally, countries and companies voluntarily act on the UN Guiding Principles while states such as Ecuador and South Africa take the core role in the adoption of a binding treaty. The Ambassador of the Permanent Mission of Japan to the International Organizations in Geneva announced at the fifth, sixth and seventh sessions of the UN Forum on Business and Human Rights that Japan had initiated the process of formulating a NAP on business and human rights. We might suppose that the Japanese NAP will be adopted before 2020 when the Tokyo Olympic and Paralympic Games are held. While Japanese businesses should follow the NAP that Japan would adopt, they are already forced to take actions according to national laws (such as the Modern Slavery Act 2015 in the UK) being implemented based on the respective NAPs in other countries. The enactment of such domestic legislations prompted Japanese businesses to discuss whether or not they should be subject to such laws. But they should accelerate appropriate measures on human rights from the viewpoint of competition with European and North American businesses. Under these circumstances, it is impossible for Japanese businesses to ignore problems related to human rights and workers’ rights in factories in their supply chains in other countries.  Businesses need to consider the trend towards the adoption of a binding treaty and to take action in compliance with national laws implementing the UN Guiding Principles. Similarly, Japanese businesses are now required to take such action in countries that have such laws.

Takeshi Shimotaya is the Executive Director of the Global Alliance for Sustainable Supply Chain.
For further information, please contact: Takeshi Shimotaya, Global Alliance for Sustainable Supply Chain, e-mail: shimotaya.t@g-assc.org; http://g-assc.org/en/.

Tracking Equality at Work

The New Zealand Human Rights Commission issued on 27 June 2018 its final report entitled Tracking Equality at Work 2018. 

Here below is a brief introduction of the project and an over-all statement on the results of the monitoring done in 2018:

Overall results show that the labour force participation and unemployment rate for women is improving however there are persisting inequalities particularly for young Māori women and  young  Pacific  men  and  women,  evidenced  by  high  not  in  education,  employment  or  training (“NEET”) rates for 20-24 year olds and high unemployment rates for people under 25  years  which  are  two  to  three  times  higher  than  those  of  European  New  Zealanders.  Young  Middle  Eastern,  Latin  American  and  African  (“MELAA”)  women  of  20-24  years  also  have a high NEET rate that is over double that of European New Zealanders. 

Full  data  sets  are  not  available  for  disabled  workers  until  the  Census  2018  data  is  made  available at the end of 2018. However, data reflective of the Census 2013 data shows that disabled people and particularly disabled women are the most marginalised in New Zealand’s labour market.

Source: www.hrc.co.nz/files/2115/3013/8951/Tracking_Equality_Report_FINAL.pdf

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