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Luxembourg – Guidance to business

Part I – Rational Framework for the development, adoption and implementation of the NAP

1. International Context

1.1. United Nations (UN) (pg. 12)

…The UN Global Compact supports businesses to carry out their activities in ways that are responsible by aligning their strategies and operations with the ten principles of human rights, labour, the environment and anti-corruption. The Global Compact is recognized as a major proponent of the UN Guiding Principles on Business and Human Rights. Luxembourg companies have adopted the ten principles enacted by the Global Compact. It should also be noted that in 2017 CSR Europe (The European Business Network for Corporate Social Responsibility) signed a Memorandum of Understanding with UN Global Compact. IMS Luxembourg (Inspiring More Sustainability) is the representative of CSR Europe in Luxembourg. The National Institute for Sustainable Development and Corporate Social Responsibility (INDR) and IMS are in the talks with the UN Global Compact to represent the local network.

 

1.2. European Union (pg. 13)

The European Commission has published an introductory guide to human rights for SMEs, based on the UN Guiding Principles on Business and Human Rights. This guide makes companies aware of the main international principles in this area and supports them in their implementation.

 

1.4. International Labour Organization (ILO) (pg. 14)

…As of March 17, 2017, the ILO has revised the Tripartite Declaration of Principles on multinational enterprises and social policy. This text provides guidance to companies on how to contribute to the realization of decent work for all. The principles set out in the Declaration are recommended for the attention of governments, employers’ organizations and multinational enterprises, and directly references the UN Guiding Principles on Business and Human Rights and implementing the Terms of Reference “Protect, Respect, and Remedy.”…

 

1.5. The Organisation for Economic Co-operation and Development (OECD) (pg. 14)

Responsible business conduct is an important aspect for a well-functioning space of trade and international investment. The establishment of a responsible business environment is in the interest of all stakeholders. It is in this context that Luxembourg, by adopting the OECD Declaration on Investment and Multinational Enterprises in 1976, also adhered to the OECD Guidelines for multinational companies, which were its corollary, and which for the first time instituted an international standard for responsible business for companies actively working internationally.

These Guiding Principles have since been adapted and developed five times, most recently at the OECD’s 50th Anniversary Ministerial Meeting, on May 25, 2011. On this occasion, the OECD Guidelines for Multinational Enterprises received a specific chapter on human rights, the wording of which was aligned on the United Nations Guiding Principles on Business and Human Rights. From a human rights perspective, the 2011 revision is a fundamental step and, by opening up its scope, has particularly widened the access to remedies since currently the complaints addressed to National Contact Points (NCP) in OECD Member States cover about a quarter of violations on human rights.

Part II – Process of the NAP

1. Initiation

1.3. A joint work program (pg. 21)

The joint work program includes:

  • an information, awareness and promotion campaign on the UN Guiding Principles that provides companies with the elements to better understand the scope of their obligations and their expectations, as well as the opportunity to realize the benefit of the guiding principles in terms of risk management and competitiveness,
  • the organization of training based on the UN Guiding Principles for the staff of signatory companies, taking into account the training cycle in CSR, open to all companies, organized by the INDR in collaboration with the House of Training,

 

Part III – NAP

1. Declaration of Engagement (pg. 26)

…In addition, the Government expects companies to fully respect human rights, and in particular: …

  • to provide the necessary governance instruments for this purpose, in particular by introducing a due diligence system. Due diligence means the process that, as an integral part of their decision-making and risk management systems, enables businesses to identify and prevent the actual or potential negative impacts of their activities, as well as to report on how they approach this issue. The nature and the scope of a due diligence that is reasonable for a particular situation depends on factors such as the size of the company, the context in which its activities take place, the specific recommendations of the Guiding Principles and the seriousness of the negative impacts. When companies have a large number of suppliers, they are invited to identify the general areas in which the risk of negative impacts is most significant; then, from this risk assessment, to exercise due diligence as a matter of priority for certain suppliers;

The overall objective of this NAP is to strengthen the protection and promotion of human rights in the context of corporate policies, governance and economic activities. In this spirit, the NAP aims to raise awareness of the United Nations Guiding Principles on companies and human rights, to see them applied at company and value chain level ​​and to monitor their implementation.

 

3. Government’s Response (pg. 28)

The Human Rights Guidance Tools developed by the UNEP Finance Initiative offers a human rights risk analysis by sector of economic activity, including the financial sector. This tool can be used to structure the dialogue with private sector actors and their sectoral professional organizations…

…In order to ensure a concrete follow-up that will allow a real measure of the commitment made by one another, it is proposed to organize training based on the UN Guiding Principles for the staff of signatory companies. To this end, a collaboration between the INDR and House of Training is encouraged in the second half of 2018. The participation of non-governmental actors may be considered for the development of specific training modules, for example on the theme of “Business and children’s rights”, the prevention of forced labour and human trafficking in supply and production chains and services used or “Business and Human Rights” offered by CSR-Europe through IMS-Luxembourg. (pg. 30)

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