J. Oliver Williams
Professor of Political Science
North Carolina State University, USA
I. Introduction
Recognition
of the link between business and human rights has increased
significantly in recent years placing a greater emphasis on social and
economic rights. Although human rights are principally the
responsibility of governments, this has become increasingly an important
issue for business. Responsibilities of businesses, especially
multi-national corporations, in fields of labor rights [child labor,
freely chosen employment, wages and working conditions inhuman
treatment] are contained in national and international law and are
recognized my responsible multinational corporations. Now, social,
cultural and even civil rights are being privatized as expectations of
companies regarding human rights emerge among governments and
non-governmental organizations [NGOs].
An
important question is the prospects of promoting human rights standards
beyond traditional areas of labor law into the realms of political and
civil rights.
Can
business succeed, where government has failed, in spanning the cultural
gap between countries and regions in human rights that are regarded as
universal in western societies but culturally relevant in Asian
countries?
Although the commitment of business in human rights are voluntary, unless backed by
national and international law, public opinion, shareholders, and
international organizations can bring support and pressure to
incorporate human rights standards in international commerce.
Can the reach of business across national borders play an effective role in promoting human rights? If
so, will businesses that engage in global commerce help to create
harmonious environments among countries that promote international trade
but differ on cultural principles of rights of individuals?
II. Business and Human Rights
Recognition
of the role of business in advancing human rights has increased
significantly in recent years. As a result evidence indicates that
discourse on human rights is increasing in corporations that span
national borders, expectations regarding human rights have increased
among the largest companies, and that businesses operating in global
commerce are under greater pressure from the public, from government and
from human rights [NGOs] to avoid business practices that violate human
rights. Likewise, increasingly, there is evidence that more of the
largest companies are following business practices that are consistent
with legal principles embodied in national and international laws.
The social responsibility movement is relatively new in the history of capitalism. In 1800, Adam Smith wrote, in Wealth of Nations:
“By
pursuing his own interest [an individual] frequently promotes that of
the society more effectually than when he really intends to promote it. I
have never known much good done by those who affected to trade for the
public good.”
As late as 1970, Milton Friedman, modern day proponent of free market economy, wrote:
“There
is one and only one social responsibility of business—to use its
resources and engage in activities designed to increase its profits so
long as it stays within the rules of the game, which is to say, engages
in open and free competition without deception or fraud.”
“That’s
the orthodox view among free market economists: that the only social
responsibility a law-abiding business has is to maximize profits for the
shareholders.”
Today, in both the European Union and North America,
codes of social conduct are prevalent in a wide variety of
international corporate sectors. Business for Social Responsibility
lists 98 corporations in North America
with a human rights policy in its business codes of conduct, along with
economic and social rights and environmental protection. BSP for over a
decade has helped companies to achieve success in ways that demonstrate
respect for ethical values, people, communities and the environment. BSR
connects members to a global network of business and industry peers,
partners, stakeholder groups and thought leaders. BSR also convenes and
facilitates cross-sector dialogue and collaboration and includes human
rights among its other concerns which include business ethics,
responsibility to communities and the environment. In
2005, the UN Commission on Human Rights requested the UN
Secretary-General to appoint a special commission on the issue of human
rights and transnational corporations and other business enterprises.
The SRC, while recognizing that human rights principles were intended to
limit state actions towards individuals or groups, has taken the stance
that human rights principles relate directly to private sector actions.
The
SCR categorizes human rights into economic, social. cultural, political
and civil Most notably, the SRC takes the positions that corporate
responsibility includes protecting civil rights, as well as economic and
social. At the same time, it refutes the contention that human rights
are a western or northern concept that do not apply universally. Noting
that economic and social rights, including the avoidance of forced
prison labor and child labor, has been a longer and more publicized area
of corporate responsibility, the SRC recognizes that the United Nations
Universal Declaration of Human Rights is the most widely recognized
human rights benchmark and holds that corporate concerns must preclude
activities that that deprive citizens of basic civil liberties.
Recognition
of the link between business and human rights, the SRC points to two
recent trends which include [1] inclusion of human rights and civil
rights corporate codes of conduct; [2] inclusion of human rights into
global business principles that include trade sanctions on nations that
broadly disregard international human rights standards. The attention
paid to human rights by consumers and investors as well as shareholder
resolutions calling upon corporations to ensure that business is
conducted consistent with human rights standards, is cited by the SRC as
the stimulus for the embodiment of civil rights standards in business
practice.
Apart
from corporate response to consumes, NGOs and shareholders, human
rights embodied in national and international law has been a major
factor. In the U.S. and Europe,
courts have accepted lawsuits alleging that multinational companies
have contributed to human rights violations, particularly in third world
countries. To avoid legal responsibility, the SRC states that both
business practice and corporate codes of conduct needs to be consistent
with local and international laws to avoid challenges to their global
operations.
The
most comprehensive data on business practices in the field of human
rights is a recently released survey undertaken by the UN
Secretary-General’s Special Representative for Business and Human
Rights. Respondents to the survey, released in September, 2006, were a
“global Fortune 500”, included the world’s largest firms defined by revenue. Some 450 of these firms were located in the United States [176], Europe [195] and Japan [80].
Among
these large multinational corporations, nine out of ten reports having
an explicit set of human rights principles or management practices in
place. Significantly fewer, about half, reported to have had a significant human rights issue. At
the same time, corporate leaders stated that embarrassing relegations
created an immediate necessity to drive an uptake of human rights
concerns.
Of
significant interest, corporations include in their concerns issues that
span the spectrum of human rights included in the UN’s declaration on
universal rights and the social and economic rights embodied in other UN
covenants.
Among the 450 responding companies:
• Recruitment
and promotion based on merit, not race, gender or religion or other
factors, and workplace health and safety were cited by all of the 450
respondents.
• Freedom of association and collective bargaining were included by 87 percent.
• Forced, bonded or compulsory labor and child labor was cited by 80 percent of the companies.
• Three out of four companies indicate that they recognize a right to privacy.
Some variation occurred among countries in various regions of the global and across corporate sectors. Apart
from non-discrimination and workplace safety, which were virtually
universal concerns, extractive industries more frequently that European,
listed freedom of association and collective bargaining. Forced
labor and child labor were mentioned more frequently by European firms,
and European firms were more likely to recognize right to life, liberty
and security of the person. Right to privacy showed little regional variation and is supported across sectors.
The overall clear and strong levels of support do show some slight regional differences, at least in rankings. U.S.
companies rank employees and suppliers higher in their concerns but
place lower emphasis on community and country of operation than do
European firms. Japanese companies are least likely to include countries
of operation in their human rights concerns.
When
asked what if any human rights instruments influence policies and
practices, not surprisingly international business organizations were
cited. However, outside of business groups, the Universal Declaration of
Human Rights was the most cited. A fourth of the companies cited no
international instruments, but notably all extractive industries cited
the universal declaration and nearly half of Japanese firms indicated
that no outside international agreements affected human rights
practices.
III. Assessing the Impact Business Human Rights Initiatives
Non-governmental participation in human rights is receiving considerable emphasis. However,
the premise that capitalist markets will necessarily foster human
rights improvements is far from being realized. Still the growth of
international trade, and the increasing influence of international trade
organizations, and the willingness of multinational corporations to
articulate a human rights commitments hold promise that the
privatization of human rights will become an important strategy of
attaining human rights globally. Not only are corporations and
international business groups assuming greater roles in formulating and
advancing human rights concerns; businesses have begun to establish code
of conduct and monitoring business practices.
The
growing number of non-state actors, among multinational corporations,
international leading institution as well as insurgency groups and even
terrorists are part of the growing privatization movement.
Non-governmental organizations [NGOs], including Amnesty International
and Human Rights Watch that
serve monitoring and advocacy roles have taken the stance that private
sector action is important but must be accompanied by legislation and
continued governmental leadership.
Nevertheless,
important questions are raised by the privatization movement. While
bringing greater emphasis to economic rights, will privatization lead,
on the other hand, to less emphasis on non-economic, civil rights
embodied in the Universal Declaration? Will the power of citizens’
groups hold corporate human rights abusers accountable through
information campaigns and even product boycotts? Will good citizen
corporations set standards that third-party suppliers and companies that
violate human rights will be compelled to follow?
Of
great importance is what effect wills commercial human rights practices
have on countries with serious violations of universal rights?
On several of these questions, the record does not allow an assessment yet of the effectiveness of the privatization movement.
1. Has the privatization movement embraced non-economic rights?
Concern
for political and civil rights of citizens in countries where they
operate has been expressed widely in the codes of conduct of the largest
multinationals. Business for Social Responsibility on its web site
lists the codes of human rights practices of 21 top companies with human
rights reports.
Cisco
is among the corporations that affirm support of the United Nations
Universal Declaration of Human Rights and Global Compact, Cisco's codes
of conduct, employee policies and guidelines substantially incorporate
laws and ethical principles including those pertaining to freedom of
association, non-discrimination, privacy, collective bargaining,
compulsory and child labor, immigration and wages and hours.
Cisco’s
approach is to have codes, policies and guidelines are reviewed by a
corporate citizenship council consisting of an executive committee and a
broad-based global membership of Cisco management.
Hewlett-Packard, another international corporation that cites human rights in its code of conduct, states:
“We
also engage globally with various stakeholder communities to address
issues related to the environment, economic development, digital divide,
privacy, labor and human rights.”
HP has a policy of encouraging employees to apply time and effort to help solve problems in their communities.
In
reference to human rights, the HP code of business conduct “upholds and
respects human rights as reflected in the Universal Declaration of Human
Rights.”
HP
is also states a commitment to fair labor practices and the respectful
treatment of all employees, including the protection of workplace health
and safety and data-privacy protections.
Publishing
reports on social concerns and adopting codes of conduct do not
guarantee respect for human rights in corporative practices any more
than human rights are practiced in countries that a signature nations in
United Nations covenants.
Amnesty
International, on of the most respected non-governmental organizations
in the field of human rights, believes that the business community also
has a wider responsibility -- moral and legal -- to use its influence to
promote respect for human rights and advocates national and
international legal instruments that promote greater corporate
responsibility for human rights, including those that assure the risk of
legal accountability if a company commits or is complicit in human
rights abuses in their operations.
II. Status of Universal Rights in Government and Business
It
is in the area of individual rights embodied in the basic United
Nations’ Universal Declaration of Human Rights, where governments have
so widely diverged in the support and the practice of human rights
principles. It is in coming to an agreement on the principles of this
declaration that nation’s having failed so basically in human rights
practices. Throughout Europe and North America and some areas of South
and Central America and Africa these principles are considered universal rights that all individuals want and deserve. In most of Asia,
however, governments consider these rights to be based on western
values that do not reflect the values of Asians who culturally have
greater regard for social harmony and stability.
Until
there is agreement on these principles there is likely to be little
harmony on human rights among the major countries of the world.
Despite
the Bangkok Declaration that states a commitment to principles
contained in the Charter of the United Nations and the Universal
Declaration on Human Rights, leaders
in most Asian nations continue to advocate a cultural relevance in
universal rights, act on the principle that individual rights conflict
with social harmony and stability, and cite Asian values as
contradicting the western ideal of universality. In fact, it was from the Bangkok
meetings that Asian leaders began to promote a cultural relevance
approach to universal rights, although the principle had been argued
before then.
International
NGOs which are largely prohibited from monitoring and reporting human
rights violations in these countries, through contact they maintain with
human rights advocates in Asia,
conclude that non-democratic rulers are a bigger impediment to human
rights than the cultural and social value system of the region. Some
Asian scholars, as well, believe that the Asian values, historically
from the time of Confucius, have philosophical roots in individual
freedoms and rights.
II. Has there been an increase in the concerns for economic rights and the rights of women and children?
The
damaging exposure of the Nike Corporation, and later as many of ten more
multinational companies, in the treatment of women workers and use of
child labor shifted the debate over corporate social responsibility for
human rights. It created a watershed in the past decade by developing a
positive role in business and trade in enhancing respect for human
rights in countries with widespread violations. Revelations of child
labor and abysmal working conditions led corporations to express respect
for essential human and labor rights, such as freedoms of association
and expression, as well as an end to cruelty and discrimination and
inequality on the basis of ethnicity or gender. Advocacy by human rights
groups, repeated media exposure, and legislative interest in banning
products made by child labor from import in the United States
has made child labor and women’s working conditions a foremost human
rights issue in the global economy. The extensiveness of child labor,
estimated at over 250 million children working around the world, has
indicated a major social problem of condemning children to a life of
poverty by putting them to work in lieu of education.
Whether
the attention has improved significantly, or even marginally, women’s
working rights or reversed a trend in child labor has not been
documented. Journalist reports indicate that poor working conditions of
women China
is less a problem with joint venture companies in Special Economic
Zones [SEZs] than small scale manufacturers surrounding these zones.
III. Has privatization affected country human rights policies?
The ascension of China to the World Trade Organization, which facilitated dropping annual assessments of China’s human rights under Most Favored Nation trading status, has moved human rights from a central place in U.S. foreign policy to in most cases subordinate to trade policy. From a high point
in the Carter administration, when human rights were prominent in
foreign policy debate, human rights concerns now are raised in
conjunction with trading issues. While trade policies mandate that the
U.S. advance human rights through its voting in multinational trade
groups and its security assistance to other countries, the subordination
of human rights to trade and security concerns has not led to
consistency in current U.S. policy. Countries important to U.S. economic and political interests are not subjected to the same degree of human rights scrutiny as nations deemed less vital to U.S. interests. Recognizing that human rights are not central in U.S.
foreign policy, and inconsistent as well, NGOs that watch human rights
compliance have pushed for sanctions against nations committing gross
human rights violations.
The internet restrictions agreed to in China
by American internet providers illustrates two sides of a problem with
international corporations violating principles in the Universal
Declaration. The actions by the large information providers were viewed
as corporate complicity in restricting rights of freedom of speech and
information. The enormous outcry from western NGOs and citizens in
western countries indicate the scrutiny the corporations receive in
social and human rights issues. Although public opinion has not led to
any reversal of agreements made by Google
Actions
by Yahoo, Google and Microsoft are viewed in the West as corporate
complicity in restricting freedom of speech and information. The
enormous public outcry has not reversed agreements made by Google.
However, these corporations are likely to be more reluctant in making
further restrictions and will be especially guarded in the types of
information that they filter.
The issue also acerbates China’s
problem of human rights in international business. Private markets
thrive on information and to remain a hub in international trade and
manufacture, China
confronts a conflict between information flow that is vital to business
and the government’s ability to control, or even appear to control,
speech and information. The expectations of multinational corporations
in upholding human rights are likely to reverberate inside China as much as outside, with as much scrutiny as social and economic rights have previously received.
IV. Conclusions
In
the past decade, there has been considerable advancement in the trend
toward injecting human rights issues in global trade. In the business
world, public opinion, non-governmental organizations, and trade
organizations that have become a leading source for business throughout
the world have worked to raise the expectations of companies in social
and civil rights. This has led to the adoption of business codes of
conduct in many of the world’s largest companies. Significantly,
western businesses have included many of the rights considered as
universal rights in the United Nations declaration. Harmony on human
rights has been impeded by conflicting value systems toward universal
rights between western nations and the economically advancing nations of
Asia. It remains to be seen if global trade will become a vehicle for bridging the gap this basic human rights divide.
(China.org.cn)
Obama's TPP.
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