Moving to curtail rights abuses by companies


When it comes to power, think transnational corporations.

Back in March Foreign Policy published an excellent report on the power of the 21st Century corporation, including these observations:

Already, the cash that Apple has on hand exceeds the GDPs of two-thirds of the world’s countries. Firms are also setting the pace vis-à-vis government regulators in a perennial game of cat-and-mouse. After the 2008 financial crisis, the U.S. Congress passed the Dodd-Frank Act to discourage banks from growing excessively big and catastrophe-prone. Yet while the law crushed some smaller financial institutions, the largest banks — with operations spread across many countries — actually became even larger, amassing more capital and lending less. Today, the 10 biggest banks still control almost 50 percent of assets under management worldwide. Meanwhile, some European Union officials, including Competition Commissioner Margrethe Vestager, are pushing for a common tax-base policy among member states to prevent corporations from taking advantage of preferential rates. But if that happened (and it’s a very big if), firms would just look beyond the continent for metanational opportunities.

The world is entering an era in which the most powerful law is not that of sovereignty but that of supply and demand. As scholar Gary Gereffi of Duke University has argued, denationalization now involves companies assembling the capacities of various locations into their global value chains. This has birthed success for companies, such as commodities trader Glencore and logistics firm Archer Daniels Midland, that don’t focus primarily on manufacturing goods, but are experts at getting the physical ingredients of what metanationals make wherever they’re needed.

Could businesses go a step further, shifting from stateless to virtual? Some people think so. In 2013, Balaji Srinivasan, now a partner at the venture-capital company Andreessen Horowitz, gave a much debated talk in which he claimed Silicon Valley is becoming more powerful than Wall Street and the U.S. government. He described “Silicon Valley’s ultimate exit,” or the creation of “an opt-in society, ultimately outside the U.S., run by technology.” The idea is that because social communities increasingly exist online, businesses and their operations might move entirely into the cloud.

The U.N. ponders a move

Two years ago, the United Nations Human Rights Council voted to begin the process of regulating the way transnational corporations impact human rights.

Here’s how the vote went:

  • In favor: Algeria, Benin, Burkina Faso, China, Congo, Cote d’Ivoire, Cuba, Ethiopia, India, Indonesia, Kazakhstan, Kenya, Morocco, Namibia, Pakistan, Philippines, Russia, South Africa, Venezuela, and Vietnam
  • Opposed: Austria, Czech Republic, Estonia, France, Germany, Ireland, Italy, Japan, Montenegro, South Korea, Romania, Macedonia, the United Kingdom, and the United States of America
  • Abstained: Argentina, Botswana, Brazil, Chile, Costa Rica, Gabon, Kuwait, Maldives, Mexico, Peru, Saudi Arabia, Sierra Leone, and the United Arab Emirates

The idea has won the support of more than 80 countries, though Obama’s America remains firmly opposed.

The work continues.

From the latest report from the Working Group on the Issue of Human Rights and Transnational Corporations of the United Nations Human Rights Council:

The most egregious business-related human rights abuses take place in conflict-affected areas and other situations of widespread violence. Human rights abuses may spark or intensify conflict, and conflict may in turn lead to further human rights abuses. The gravity of the human rights abuses demands a response, yet in conflict zones the international human rights regime cannot possibly be expected to function as intended. Such situations require that States take action as a matter of urgency, but there remains a lack of clarity among States with regard to what innovative, proactive and, above all, practical policies and tools have the greatest potential for preventing or mitigating business-related abuses in situations of conflict. In the present report, the Special Representative of the Secretary-General on the issue of human rights and transnational corporations and other business enterprises outlines a range of policy options that home, host and neighbouring States have, or could develop, to prevent and deter corporate-related human rights abuses in conflict contexts.

>snip<

States should warn business enterprises of the heightened risk of being involved with gross abuses of human rights in conflict-affected areas and clearly communicate their expectations with regard to business respect for human rights, even in such challenging environments. With few exceptions, States have yet to convey their expectations of business behaviour in situations of conflicts. Normally, States would convey such expectations through policies, laws and regulations. For example, in the area of anti-corruption, States in recent years have agreed upon and communicated their expectations regarding standards of business conduct with respect to bribery through international conventions and domestic policies and regulations. However, unlike anti-corruption, the existing legal and policy framework relevant to conflict-affected regions does not have a component that is specifically designed to deal with the problems of business involvement.

This lack of regulatory clarity limits the ability of States to engage or advise business enterprises regarding acceptable conduct in or connected to conflict-affected regions. Therefore, states should review whether their policies, legislation, regulations and enforcement measures effectively address the heightened risk of businesses operating in conflict situations being involved in gross human rights abuses, including through provisions for human rights due diligence by business. They should ensure that their regulatory frameworks are adequate, the applicability to business entities is clarified and, for the most extreme situation, make sure that the relevant agencies are properly resourced to address the problem of business involvement in international or transnational crimes, such as corruption, war crimes or crimes against humanity.

Abby Martin interviews one of the measure’s architects

In this, the latest episode of Abby Martin’s series for teleSUR English, the San Francisco Bay Area native interviews a diplomat who played a seminal role in shaping the UN panel’s mandate.

From teleSUR English:

The Empire Files: Bringing Corporations to Justice with Ecuador’s UN Rep

Program notes:

For the first time ever, progress is being made at the United Nations for a binding legal instrument that would hold corporations accountable for human rights violations. Transnational corporations — many with larger economies than the countries they operate in — have enjoyed immunity from charges for destroying the environment and taking human lives. But Ecuador is leading a fight in the UN to create an international treaty and standards that can change this equation. At teleSUR’s studios in Quito, Abby Martin interviews Ecuador’s Permanent Representative to the UN and Chair of the negotiations for the binding instrument, María Fernanda Espinosa, about the need for this step.

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