LONDON, 28 April 2003 — Human rights and business have always been difficult and controversial bedfellows. The aid and human rights industry have consistently attacked big business for its lack of environmental and social accountability. NGOs (non-governmental organizations) and charities singled out the tobacco, alcohol, diamond extraction, and arms industries for being “merchants of death”; and the sports goods and carpet manufacturing industries as “child labor exploiters.”
With US companies and a few others lined up for huge reconstruction contracts in Iraq, international human rights organizations have warned these companies bidding for contracts to ensure that they do not become guilty of human rights abuses. Amnesty International has just published what it claims is the first human rights checklist for companies titled “The Human Rights Responsibilities of Companies.” The checklist draws on existing international laws, treaties, and codes including child labor, trade unions for workers, working with sub-contractors and ensuring that security arrangements do not lead to torture, ill-treatment or curtailing freedom of expression. According to Peter Frankenthal, Amnesty’s UK Business and Human Rights Manager, “Companies now expect to be scrutinized for their human rights practice.”
More and more global companies are producing social and environmental audits of their business activities. The better the company’s corporate environmental audit, the higher the value of its stock. In fact, environmental impact assessments are now almost compulsory on many projects financed by the World Bank and many regional and national development agencies. Companies such as Shell have regular forums between senior management and social committees whose aim is to familiarize senior management with the sentiments of the “real world”, to learn how the community perceives the company and its activities and how the company can change and correct those concerns and perceptions.
In the UK, the Association of British Insurers have called on companies it represents to disclose social and ethical risks so as to assess value.
The Amnesty Human Rights and Business Checklist focuses on the right to equal opportunity and non-discriminatory treatment, the right to personal security, rights of workers, respect for national sovereignty and human rights, obligations in regard to consumer protection, obligations in regard to environmental protection and general implementation.
Similarly, governments may collude with business in violating human rights. International agencies such as the UN, which are responsible for the very human rights treaties and conventions, too are not without any blame, although they essentially remain hostage to their paymasters and the bully boys on the block — the superpowers. Take, for instance, the UN Security Council. There is a strong case to amend the rules relating to the “Permanent Five”. Germany and Japan are much larger economies than the UK and France, and yet they are not permanent members of the Security Council. Nor are emerging giants such as Brazil and India.
The council can be a powerful tool of censure, but only when it acts under a consensus — for instance, in the area of economic and arms sanctions. Against Iraq, there was rigorous enforcement. Against Apartheid South Africa there were blatant disagreements and violations, and only minimal consensus. Against Israel, no US president would even contemplate any sanctions for fear of the wrath of the powerful Jewish lobby in American domestic politics.
The current Amnesty Human Rights and Business Checklist is too general and narrow, and also does not extend to the internal mechanics of corporate and business structure and operations — corruption in management (accounting failures) and the way they impact on the human rights of employees especially those that lost their pensions; the way corporates (and their stockbrokers and auditors) over-value their stock and the way this profiteering impinges on the human rights of consumers and of those who subsequently buy the stock; the obscene bonuses and fat cat salaries paid to senior management as if they are solely responsible for adding value to a company and for its success. Sometimes bonuses are paid even in the case of failing enterprises. The very nature and movement of capital especially by fair-weather fund managers in the West have left many an emerging economy in tatters, not that they are solely to blame. Isn’t profit maximization at any cost the ultimate human rights violation of business?
The truth is we need a wider debate about human rights and business. All over the world, the rights of workers are being revised and diluted, against the bogey of globalization, competition, and the forces of the market.
However, management and the owners of capital, have thus far escaped the equivalent reforms unleashed on employees all over the world. And yet in some of our leading democracies they are the bedfellows of presidents and prime ministers; and some of them end up as vice-presidents, finance ministers, energy ministers, and science ministers.
