International law should promote human rights before profit

Europe – Supply chains – Human rights due diligence

Whether it is workers who produce clothes for the European market under inhumane working conditions in Southeast Asia, the Brazilian village community whose subsistence is destroyed by a transnational mining project, European arms being exported abroad or Philippine farmers suffering from poisoning of pesticides produced in Germany or Switzerland: current national and international laws do not sufficiently protect their rights from the impact from business enterprises based in Germany, the EU or beyond.

Businesses’ conduct, whether by action or omission, can cause, contribute to or be linked with a variety of human rights abuses in their own operations or their business relationships, including global value chains. ECCHR views it as essential that companies be legally obliged to adequately address human rights risks – and for them to be held accountable for possible damages.

Case

Ten years after the UN Guiding Principles on Business and Human Rights were adopted, there is a broad recognition that companies have a responsibility to respect human rights. However, in practice, it is clear that this voluntary approach has not yielded the necessary results. Consequently, a growing number of European countries have adopted or are considering legislation mandating human rights due diligence, among them France and Germany. Requiring all companies in all sectors to address the human rights risks they cause, contribute or are directly linked to can ensure robust, resilient and sustainable value chains and investments.

On the UN level, an intergovernmental working group has been established to draft a treaty to embed the idea of mandatory human rights and environmental due diligence into a legal obligation.

ECCHR is working with institutions and other NGOs to push human rights due diligence legislation in Germany, the EU and the UN. This political advocacy is based on the expertise by ECCHR’s legal casework. Time and again, we see that the effects of legal interventions are limited due to the lack of adequate laws.

Context

Companies should be forced to ask: how can we contribute to the textile supplier in Bangladesh respecting labor rights? Or: how can we ensure indigenous groups are guaranteed their rights before building a wind park or opening a mine? Abusing the law must be sanctioned, for example with fines. Furthermore, the law must enable those whose human rights have been violated to enforce those rights in court.

Third-party (social) audits and certifications can play a key role in supporting risk analysis, but must uphold human rights due diligence standards themselves. Careless or incorrect certificates should not enable companies to ignore or cover up deficiencies like child labor, sexual violence or trade union repression.

Media

German NGO initiative is calling for a human rights due diligence law © Initiative Lieferkettengesetz
German NGO initiative is calling for a human rights due diligence law © Initiative Lieferkettengesetz

Documents (3)

Press (1)

Partners

Glossary (2)

Definition

Due diligence

Due diligence is a common concept in corporate risk management systems. The idea of corporate human rights due diligence (HRDD) is set out in the UN Guiding Principles for Business and Human Rights. HRDD obligations refer to a company’s duty to carry out ongoing risk management to determine if its business practices could potentially adversely affect human rights. This includes risks to all those who could be negatively affected by a corporation's actions (e.g. employees, consumers, and persons who could be affected by environmental harm).

Topics (1)

Insight

Social audits and certifications

Inspections, certifications, safety audits: what sounds helpful is often a sham. So-called safety and working condition audits are of little use to workers in global production and supply chains or residents of (agro)industrial areas. Instead of state inspections, for which there is rarely sufficient money or political will, private companies monitor labor, health and environmental standards.

This social auditing and certification system helps European buyers claim they are “doing something,” although in reality, it intensifies problems in the supply chain. By appearing to be a functioning, independent inspection of the supply chain, the system prevents the actors responsible – factory owners, manufacturers, distributors, and especially governments – from developing effective mechanisms to improve working conditions. The same applies, for example, to certifications of the sustainability of plantations, and the safety of medical products or hazardous structures such as dams.

However, repeatedly there are serious problems with inspections by private companies. Certifiers are sometimes commissioned and paid by the companies they inspect – undoubtedly a conflict of interest. Moreover, audits (also known as “conformity assessments”) often only provide snapshots of operations, especially when visits are announced, as is typical. In some cases, only issues with easily measurable indicators are examined, such as mandatory overtime and firefighting equipment. By making these visible and ignoring others, certifiers suggest that other problems, such as pressure on trade unions, discrimination or sexual harassment, do not exist. Inspection methods are also often problematic, for example, only using data from the inspected company’s management, interviewing workers in front of their superiors, or neglecting trade unions’ views.

ECCHR’s cases highlight a structural problem: in addition to their clients, certifiers bear responsibility for the environment and human rights, but it is difficult to hold them accountable. Particularly in high-risk industries such as mining and textiles, those responsible for safety, the environment and human rights must not be obscured by long and disperse decision-making chains. One possible solution is to create legal standards on quality control for social and sustainability audits, similar to those already in place for other types of certification.

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