The State responsibility to foster a corporate culture respectful of human rights both at home and abroad is a key element of the first pillar of the UN Guiding Principles on Business and Human Rights, the state duty to protect. Corporate law dictates the formation and the activities of corporations, while corporate governance regulates the balancing of interests among a business’s different stakeholders. Corporate law and governance therefore directly shapes what businesses do and how they do it. However, their connection to human rights remains poorly understood, as they are often viewed as distinct legal and policy spheres, populated by different communities of practice, as can be seen in the Report of the Special Representative of the Secretary General on the issue of human rights and transnational corporations and other business enterprises. Some of the key concepts and characteristics of corporate law such as legal personality, limited liability, liability within corporate groups, and delegated management have been obstacles to the legal accountability of transnational companies for human rights-related abuses by their subsidiaries and business partners. On the other hand, several aspects of corporate law and governance such as rules on company disclosure, non-financial reporting, directors duties and stakeholder engagement are important for the protection of human rights and remediation of any harms.
The UN Guiding Principles recognise the key role of corporate law and governance in the protection of human rights. According to Guiding Principle 3, in meeting their duty to protect, States are urged to:
“(a) Enforce laws that are aimed at, or have the effect of, requiring business enterprises to respect human rights, and periodically to assess the adequacy of such laws and address any gaps;
(b) Ensure that other laws and policies governing the creation and ongoing operation of business enterprises, such as corporate law, do not constrain but enable business respect for human rights
(c) Provide effective guidance to business enterprises on how to respect human rights throughout their operations;
(d) Encourage, and where appropriate require, business enterprises to communicate how they address their human rights impacts.”+ Read more
The Commentary to UN Guiding Principle 3 adds that States should “consider a smart mix of measures – national and international, mandatory and voluntary – to foster business respect for human rights.” These measures “might range from non-discrimination and labour laws to environmental, property, privacy and anti-bribery laws. Therefore, it is important for States to consider whether such laws are currently being enforced effectively, and if not, why this is the case and what measures may reasonably correct the situation.” Furthermore, “[l]aws and policies in this area should provide sufficient guidance to enable enterprises to respect human rights, with due regard to the role of existing governance structures such as corporate boards.”
Former UN Special Representative on Business and Human Rights, Professor John Ruggie, conducted a cross-national study on human rights and corporate law as part of the “Corporate Law” project. The study sought to identify how corporate and securities law in 39 jurisdictions encourages companies to respect human rights. Observations and trends emanating from the study were published in a report in 2011. The study identified that the respondent States drew a link between corporate law and governance and human rights, citing that “several States recognize through their corporate and securities laws that responsible corporate practice should avoid negative social or environmental consequences, including for human rights.” (Report on Human Rights and Corporate Law)
The extent to which directors are required, allowed, or encouraged to consider the human rights impact of a business’s operations has recently been examined. A middle-ground between Shareholder Primacy and Stakeholder Theory, in corporate governance is the concept of Enlighted Share Value (ESV). ESV is the idea that “corporations should pursue shareholder wealth with a long-run orientation that seeks sustainable growth and profits based on responsible attention to the full range of relevant stakeholder interests”. The United Kingdom legislature incorporated ESV in the director’s duties provisions of the UK Companies Act 2006 to make it possible for directors to take into account the long-term sustainability of the company, and not purely short-term profits. Another interesting development from the United Kingdom is the creation of Community Interest Companies (CICS). A CIC is a limited liability company, with special additional features, created for the use of people who want to conduct a business or other activity for community benefit, and not purely for private advantage. This is achieved through a “community interest test” and “asset lock”, which are regulated by the Government, and ensure that the CIC operates for the community’s benefit.
Businesses are also undertaking voluntary measures either at their own initiative or in response to shareholder pressure. For instance, 20% of the annual cash incentive compensation for Alocoa’s executive officers is tied to security, environmental and diversity targets. Shareholders are increasingly urging businesses to incorporate environmental, social and governance (ESG) considerations in their operations. Shareholders of ExxonMobil successfully petitioned the company in 2017 to appoint a climate change specialise to its Board of Directors.
Companies can contribute to respect for women’s rights through women’s economic empowerment supported by sound corporate governance. In support of this, over 3,000 global businesses have endorsed the Women’s Empowerment Principles, a joint effort by UN Women and the UN Global Compact, which focus on corporate actions to encourage women’s empowerment in the workplace.
Future developments to help corporate law and governance incorporate human rights impacts include increasing the extent to which directors and officials can consider human rights impacts in a business’s operations, linking executive pay to ESG considerations, and possibly redefining the purpose of a corporation (Purpose of the Corporation Project).
SDGs 16 (peace, justice and strong institutions) and 17 (partnerships for the goals), have clear links to corporate responsibility and governance, outlining targets on reducing corruption and bribery (16.5), accountable and transparent institutions (16.6), and encouraging states and companies to create meaningful partnerships for enhanced SDG implementation through finance, trade, technology, and multi-stakeholder and public-private partnerships (Goal 17). SDG 17 highlights contains key targets that represent enabling factors for the achievement of the 2030 Agenda as a whole. Much of its content is also reflected in detail in the Addis Ababa Agenda for Action.
Policy coherence is a key enabling factor for SDG achievement, highlighted in SDG 17. There is thus a strong basis to work towards ensuring that legal and policy frameworks enabling achievement of the SDGs – including corporate law – are also in line with states’ human rights commitments. Since the overarching aim of the SDGs is to “realize the human rights of all”, a successful realisation of the 2030 Agenda will require policy coherence to ensure that “states meet their duty to protect human rights from business-related human rights abuses and that businesses meet their corporate responsibility to respect human rights”, as is further explained in the key recommendations to Governments and businesses from the UN Working Group on Business and Human Rights.
16) Peace, Justice and Strong Institutions
17) Partnerships For The Goals
What National Action Plans say on Corporate law & corporate governance
Action point 4
Promote existing qualitative initiatives on human rights and social responsibility
Promouvoir les initiatives qualitatives existantes relatives aux droits de l’Homme et à la responsabilité sociétale
The Flemish government plans a sustained and sectoral approach to social responsibility as companies operating in the same sector face similar challenges. In consultation with the sectoral organizations, the Flemish authorities will support these organizations and their members in order to sustain their value chains and management of their businesses.
Action point 9
Strengthen collaboration between public services and the various organizations active in the field of human rights and of international entrepreneurship
Renforcer la collaboration entre les services publics et diverses organisations actives dans le domaine des droits de l’Homme et de l’entrepreneuriat international
This section mentions that the regional authorities and a number of Belgian institutions at several levels (such as Ducroire, Finexpo, the Belgian Investment Company, the Belgian Investment Company for Developing Countries, and also organizations such as the Chambers of Commerce among others) that support international entrepreneurship can also obtain information on the ground, through their members, and gain experience in the field of corporate management of human rights issues around the world. An action therefore involves the collection of information from such stakeholders.
Action point 15
Incorporate the principle of “due diligence” into the management of the company, also in the terms of human rights
Intégrer le principe de « diligence raisonnable » au sein des organismes de gestion de l’entreprise, également en matière de droits de l’Homme
This section mentions corporate governance. Concretely, the action will consist of contacting those responsible for the two Belgian corporate governance codes in order to examine the possibility of integrating international developments, in particular with regard to human rights, which will entail the attempt to minimize the administrative burden on public authorities or enterprises, but without impairing the application and implementation of ambitious criteria and controls.
Action point 29
Facilitating the circulation of knowledge in the field of human rights and CSR
Faciliter la circulation des connaissances dans le domaine des droits de l’Homme et de la RSE,
The government of Walloon will seek to encourage university networks of researchers concentrating on the topic of management of corporate socio-economic aspects on the perspective of the respect for human rights and CSR.
Pillar 1: The State Duty to Protect Human Rights
Strand 8: Legislation, Policies and Incentives
Action Point 8.1. (page 60)
The Ministry of Economy will support the legal provision committed in the Agenda for Productivity, Innovation and Growth seeking to create a legal framework for social business enterprises, by encouraging the incorporation of business and human rights criteria.
Strand 9: State Business Enterprises
Action Point 9.2 (page 49)
The National Oil Company (ENAP), with the support of independent experts, will prepare a baseline to identify eventual impacts on human rights and the promotion and respect actions the company is currently performing. This aims to identify gaps and manage the relevant plans for human rights remediation and mitigations. Priority subjects included in the study will be: life, health, environment, water, communities and workers. This initiative is based on the new Sustainability Policy passed by the Board of Directors in December 2016. It is composed of four strands: consideration of stakeholders, environment, integrated management and human rights.
Action Point 9.3 (page 50)
The Ministry of Economy, Development and Tourism will support the incorporation of the Guiding Principles in the business enterprises forming part of the System of Public Business Enterprises (SEP).
To strengthen coordination between the Ministries forming part of the Inter-Ministerial Working Group, amplify the impact of this Action Plan, and make known its progress, the Group will carry out the following actions: …
2. Encourage the adoption of policies, statements or codes of conduct by business enterprises and urge the implementation of mechanisms of due diligence
Pillar 2: The Corporate Responsibility to Respect Human Rights
Strand 2: Promotion of Corporate Due Diligence in the Field of Human Rights
Action Point 2.1 (page 54)
The Ministry of Foreign Affairs, through the General Directorate of International Economic Relations, will:
- Promote human rights in the management of public funds to promote exports carried out by ProChile, through the progressive incorporation of analysis mechanisms helping to ensure that business enterprises having access to the tools offered by this entity respect human rights. Likewise, it will establish, if relevant, requirements about sustainability and respect for human rights, as criteria to choose the business enterprises participating in programmes to promote exports and corporate activities, including SMEs and micro SMEs. …
Action Point 2.2 (page 55)
The Ministry of Economy, Development and Tourism will: …
- Hold a working group meeting at least once each semester with the Division of Social Economy and Associativity and the Division of Smaller Business Enterprises, with the purpose of identifying the impact of human rights in the management of businesses such as cooperatives and SMEs, and of incorporating the vision of human rights and business enterprises within this type of economic associations. Based on the activities of the working groups, sector guides will be developed to evaluate compliance with human rights issues, with special emphasis on the management of supply chains. …
- Agree, with business enterprises represented in the Social Responsibility Council for Sustainable Development, upon the development of memorandums of understanding, guides, handbooks and guidelines containing best practices, so that they can become an integral part of business and human rights standards in the following subject matters: labour practices, impact on communities, corporate practices and supply chain management. …
- Coordinate technical meetings with SEP, CORFO, SERNAC and SERCOTEC to agree on the incorporation of targets and indicators of compliance with human rights standards in these services.
`The Colombia NAP does not explicitly address this issue’
Criminal liability of legal persons in the field of human rights [page 11-12]
“Implements Principles 1 and 3a
Modern business is inconceivable without companies and cooperatives. They facilitate the concentration of funds, limit risk, and create opportunities for professional management. They are a means of implementing major business projects. However, like any other such means, companies may be open to abuse. Those who engage in crime can divide up responsibility for decisions and hide behind convoluted management structures. At large corporations, it can often be difficult to find a specific liable person. The Act on the Criminal Liability of Legal Persons [Act No 418/2011 on the criminal liability of and proceedings against legal persons] resolves this by making it possible to infer that a legal person as a whole is liable.
The most serious human rights abuses can be punished as crimes. According to the case-law of the European Court of Human Rights, too, the state duty to efficiently investigate and ultimately punish infringements is central to human rights protection. However, criminal prosecution is the strongest instrument of power the state can wield, and has repercussions for employees, shareholders, creditors, business partners and others who have nothing to do with criminal activity. In this light, legislation needs to be monitored and evaluated.
While the state carries primary responsibility for human rights protection in its territory, in today’s interconnected age the stringent application of the principle of territoriality is impossible. The Czech Republic has decided that – whether unilaterally or on the strength of an international treaty – it will prosecute certain unlawful conduct by Czech nationals irrespective of where this conduct occurs. As such, it is assuming responsibility for the conduct of its nationals (including businesses) abroad, thus making it possible to fill in the regulatory gap to some extent in those cases where such conduct is not punishable under another country’s law.
Current state of play:
- The criminal liability of legal persons was introduced into Czech law in 2011 and covered and exhaustive set of criminal acts. In 2016, the concept underlying the definition of the criminal liability of legal persons was revised so that a legal person can now be liable for all crimes other than a narrow group of acts expressly precluded by law.
- Czech law allows a Czech citizen or a legal person established in the Czech Republic to be prosecuted even if they committed their crime abroad.
- Foreign nationals and legal persons perpetrating a crime to the benefit of a Czech legal person may also be prosecuted.
- Under Czech law, the most serious human rights violations [The criminal acts listed in Section 7(1) of Act No 40/2009, the Criminal Code] can be prosecuted regardless of the perpetrator’s nationality or where such violations occurred.
- The Czech Republic is party to a number of international treaties on legal assistance and on the prosecution of various types of international criminal activity, including the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions.
- Evaluate the impacts and practical application of the new text of the Act on the Criminal Liability of Legal Persons. If it transpires that the legislation still has loopholes impeding or preventing the prosecution of serious violations of human rights, propose amendments to the law.
Coordinator: Ministry of Justice
Deadline: 31 December 2018”
Disqualification of a member of a body [page 13-14]
“Implements Principles 1 and 3b
If a company executive orders or, due to negligence or connivance, allows the company he or she manages to encroach on human rights, that executive must be found to be liable. It is always more advisable to prosecute specific culprits rather than a whole company. However, a criminal penalty is not always appropriate. Indeed, criminal prosecution appears to be too strict a response to minor or negligent breaches of the law.
One possible solution is disqualification – banning someone from holding corporate directorships. Professionals recommend disqualification as a lighter form of punishment for a number of acts directly associated with business activity. Disqualification is a punishment that is suitably harsh for the perpetrator without carrying the stigma of criminal prosecution, and does not harm the company as a whole. Furthermore, judicial proceedings in such a case are simpler and more economical.
Although current Czech law does accommodate disqualification, this is restricted to a narrow set of offences and the maximum duration is limited. In this respect, we need to explore whether the present wording of constituent elements is sufficient, i.e. whether it is broad enough for the courts to have sufficient opportunity to apply this instrument, while being definitive enough so that members of company bodies know what acts are prohibited. We should also consider what the maximum duration of disqualification ought to be for the various acts.
Current state of play:
- The disqualification of members of governing bodies from holding such office was introduced into Czech law in 2014 by the Business Corporations Act. This makes it possible to punish those who have bankrupted their company or have repeatedly and seriously breached the tenet of due diligence. They may be disqualified for up to 3 years.
- Members of governing bodies, influential persons and controlling entities may be disqualified. [Section 76(2) of Act No 90/2012 on companies and cooperatives]
- Assess the use and applicability of this concept and consider whether it needs to be revised. In particular, evaluate the breadth of constituent elements, how sufficient the definiteness and precision of the law is, as well as the maximum disqualification period and variations depending on the seriousness of the act, and consider extending this concept to other persons effectively exercising influence over the running of a company. Also consider revising this concept so that it is not limited to companies, but can also be applied to other types of organisation with a different legal form. In these assessments, focus on the punishability of acts where a member of a governing body enables human rights standards to be breached either wilfully or out of gross negligence. If the concept of disqualification proves to be hard to apply in these situations, consider revisiting the constituent elements so that disqualification is easier to impose in such circumstances.
Coordinator: Ministry of Justice
Deadline: 31 December 2020”
State aid, guarantees and subsidies [page 26]
“Current state of play:
- Guidelines on Corporate Governance of State-Owned Enterprises are taken into account in the management of state enterprises and companies in which the state has a shareholding.”
Transparency [page 37-38]
“The Guiding Principles set great store by openness and transparency, which in practice means communication with the public, with employees and with other stakeholders. Businesses should make public the fact that they are mindful of their responsibility, that they are not just assuming this responsibility for show, and that they accept it as part of their business ethics. This ongoing communication could include not only the public, but also investors, business partners and potential employees, for whom the business, by following this path, has become a more attractive partner or place to work. Communication may be one way (e.g. various forms of non-financial reporting) or bidirectional (e.g. public hearings on matters of general interest).
The Government of the Czech Republic recommends that businesses where the activities, products, services or business relationships are associated with risks of serious human rights violations formally provide information on how they are dealing with those risks, even in situations where the law does not require them to do so. The government recommends all companies reporting on human rights to take account of the Reporting Framework for the UN Guiding Principles on Business and Human Rights. Reporting should provide information of relevance without overwhelming the reader. The Government also recommends that large-scale projects with a potential major impact be publicly presented and consulted.”
While there is no explicit reference to corporate law and corporate governance in the Danish NAP, it is possible to read elements of it.
Appendix 1, GP3b
Status in Denmark (initiatives implemented before the UN ratification of the Guiding Principles) [page 26]
“all new legislation is evaluated in terms of human rights consequences. Large parts of Danish national law support compliance with the UNGPs such as legislation on labour issues, the environment, child labour etc. This type of protective legislative framework of Denmark enables business respect for human rights.”
This implies that Denmark undertakes efforts to ensure that all legislation, including corporate law, is evaluated in terms of human rights consequences.
Appendix 1, GP 4
Status in Denmark (initiatives implemented before the UN ratification of the Guiding Principles) [page 28]
“[The Danish Investment Fund for Developing Countries (IFU)]’s overall objective is to promote sustainable economic growth, economic development and a more equitable distribution of income by co-financing private sector investment in developing countries. IFU’s investments in projects should contribute to job creation, good governance, respect for the environmental, higher social standards and community development.”
2 The state and companies
2.1 The state as an economic operator [page 22-23]
“The Ownership Steering Department in the Prime Minister’s Office has set a CSR reporting requirement for unlisted companies that are either majority-owned by the state or entirely state-owned. This also includes human rights. The obligation requires that companies submit reports in accordance with the best practices in the branch of activity concerned and, at minimum, adopting the standards corresponding to those of their central competitors.
As an owner, the state expects that the administration and management of state-owned companies take human rights into consideration in a responsible and transparent manner, both in their own organisation and in their subcontracting chains.
As a follow-up measure, the working group proposes that
- the importance of human rights to the state when serving as a company owner will continue to be emphasised in preparing the next decision in principle on ownership policy.
- When the amended OECD Guidelines on Corporate Governance of State-Owned Enterprises enter into force around the end of 2015, the new definitions of policy will be included in the ownership guidance practices of the Finnish state.
Principal responsible party: Prime Minister’s Office, schedule before the end of 2016.”
I – The State’s Obligation to Protect Human Rights
The International Framework
1. The United Nations (UN) [page 13]
… France also chairs the Group of Friends of Paragraph 47 of the Rio+20 Declaration. This group promotes sustainable development reporting to better ensure that economic actors respect social, environmental, good governance and human rights standards. This group successfully advocated for reporting to be reinforced and extended to all SDGs …
2. The International Labour Organization (ILO)
France is second to just one other country in its ratification of ILO conventions. It has ratified 127 conventions, including the eight fundamental conventions and the four governance conventions (considered priority instruments). It regularly publishes reports on the enforcement of these conventions, which are submitted to the organization’s Committee of Experts on the Application of Conventions and Recommendations. The observations and recommendations of this committee are taken into account when revising national regulatory instruments and practices. France is committed to seeing ILO, a source of international labour laws, establish a shared reference standard based on a common interpretation of conventions. It actively supports the universal ratification process for ILO’s eight fundamental conventions. For several years, it has also underlined the need to reinforce the organization’s supervisory system.
France is one of ILO’s more active members and has a permanent seat on the organization’s Governing Body. It adheres to and promotes the Decent Work Agenda, and fully supports the Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy (the MNE Declaration). The country has signed a four-year partnership agreement with the International Labour Office, which involves implementing CSR initiatives and contributing to
the Better Work Programme.
4. The International Organization for Standardization (ISO) [page 15]
France actively contributed to work completed by ISO which resulted in the adoption of the ISO 26000 standard on social responsibility for businesses and organizations. This standard seeks to promote a common understanding of social responsibility, but cannot be used for certification. The ISO 26000 standard deals with seven core subjects, one of which is human rights …
… In addition, France steered work on the voluntary international standard ISO 20400, which provides guidance on sustainable procurement for organizations in the public and private sectors, through the French standardization organization AFNOR. This standard aims to establish a basic frame of reference to tackle the practices of social and environmental dumping. It was approved in late January, which paved the way for its publication.
Actions Underway [page 16]
- France is participating in work carried out by the UN intergovernmental working group on transnational corporations and other business enterprises with respect to human rights, which has been mandated to elaborate an international legally binding instrument, subject to the integration of parameters defined with our European Union partners, in order to ensure that the process respects the unanimity and integrity of the UN Guiding Principles (applicability to all businesses, consultation with businesses and integration of UN Guiding Principles).
- Working with the Group of Friends of Paragraph 47 of the Rio+20 Declaration, France supports the reinforcement of reporting requirements in the environmental, social and governance fields, especially with respect to the implementation of the Sustainable Development Goals adopted on 25 September 2015.
- France actively contributes to OECD activities in the field of responsible business conduct, particularly its work on due diligence (in the textile and finance sectors) and reinforcing the OECD Guidelines to mark their 40th anniversary (from June 2016 onwards).
Actions to be Implemented
- Work to enhance cooperation between the World Trade Organization (WTO) and ILO to better integrate international social standards on responsible production processes and methods (for example, targeting child labour and forced labour), in order to promote a level playing field that takes into account existing frameworks and regulations.
The European Framework
7. The European Union (EU) [page 17]
France has played an important role in ensuring that these issues are high on the European agenda, particularly with respect to the adoption of the European directive on binding non-financial reporting, which France actively supported during negotiations.
It also promoted the inclusion of social, environmental and governance standards in trade and investment agreements. It helped to ensure that the conclusions of the Council of the EU under the Dutch Presidency were adopted, supporting the enforcement of the UN Guiding Principles on Business and Human Rights and their integration into development policy.
France could play a key role in the adoption of a common European framework on due diligence. The French National Assembly launched a parliamentary “green card” initiative to this effect.
- France has made human rights a requirement in non-financial reporting following the transposition of European Directive 2014/95/EU of the European Parliament and of the Council of 22 October 2014 amending Directive 2013/34/EU as regards disclosure of non-financial and diversity information by certain large undertakings and groups.
- France is promoting the notion of due diligence at the European level to encourage the creation of a common framework based on the legislative framework adopted in France.
- France has transposed the European Directive on trade secrets into national law, allowing businesses to protect trade secrets while assuring the necessary transparency of business activities and conduct, and the protection of whistleblowers acting in the public interest.
The National Framework
10. The Reinforcement of Legislation [page 23]
Recent public policies have led France to adopt new legislative measures supporting CSR.
- For approximately ten years, French legislation has required all large companies to publish detailed information on their CSR policies. The 2001 Act on New Economic Regulations, otherwise known as the NRE Act, requires listed companies to disclose specific social and environmental information in their management reports. The Act of 12 July 2010, also referred to as the Grenelle II Act, reinforced transparency requirements in two ways:
- Under Article 224 of this act, the annual reports of asset management companies must mention the ways in which their investment policies take into
account environmental, social and governance criteria.
- Under Article 225 of this act and the decree of 24 April 2012, companies must provide more detailed information, non-listed companies that exceed thresholds (for example, the threshold of 500 employees) must respect transparency obligations, 11 and independent third parties must check the
- Under Article 224 of this act, the annual reports of asset management companies must mention the ways in which their investment policies take into
- Articles 70-IV and 173-IV of the Act on Energy Transition for Green Growth of 17 August 2015 extended reporting requirements by introducing the concept of the circular economy and asking companies to provide information on how the use of their goods and services affected climate change. An implementing decree was adopted in August 2016 to clarify these obligations.
France also played a key role in developing transparency obligations for companies at the European level. It was the main supporter of the draft directive on non-financial reporting obligations, published on 22 October 2014, which requires large European listed companies to publish reports on their social, environmental, human rights and corruption policies. France encouraged the European Commission to take an ambitious approach when adopting the guidelines discussed in the directive. The directive is currently in the final stages of being transposed into French law. This will reinforce existing non-financial reporting requirements for companies.
- In the development field, the Act of 7 July 2014 on France’s strategy for development and international solidarity states that policy in this field must take into account “the social and environmental responsibility of public and private actors”. In addition, “France shall promote this requirement to partner countries and other donors”.
- Furthermore, “It shall also encourage businesses with their headquarters in France and with offices abroad to implement the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights”. Also under this act, “Companies shall implement risk management procedures to identify, prevent or mitigate social, health and environmental damage and human rights abuses that may arise as a result of their operations in partner countries”.
- The Act of 21 July 2014 defined the scope of the social and solidarity economy (SSE) for the first time. The notion of an SSE enterprise now covers
- traditional actors (nonprofit organizations, mutual societies, cooperatives, and foundations) as well as new forms of social enterprise (commercial companies which pursue socially useful goals and decide to adopt SSE principles). Under this definition, the SSE represents 10% of GDP and 2.3 million employees. After the Rana Plaza tragedy, France wished to give consumers the ability to check manufacturing conditions for goods sold in France by distributers, manufacturers and producers. Article 93 of the SSE Act, which discusses transparency obligations with respect to the social conditions of a product’s manufacture, entered into force on 1 August 2014.
- Article 13 of the SSE Act seeks to ensure that more public purchases are made from socially responsible businesses (many of which are part of the SSE) and that better use is made of social clauses in procurement contracts. It states that, if a maximum annual procurement amount is exceeded, contracting authorities must adopt schemes promoting socially responsible purchases. This article came into force on 1 February 2015 (Decree of 28 January 2015).
- Article 11 of the SSE Act creates a “socially useful solidarity-based enterprise” accreditation which is awarded to businesses with high social standards so they can attract private financing from socially minded investors, particularly solidarity-based employee savings. This article came into force in the first quarter of 2015 after the Conseil d’Etat (Council of State) issued a decree to this effect.
- An act on a duty of vigilance for parent companies and outsourcing companies was promulgated on 27 March 2017. Under this act, companies that employ more than 5,000 employees in France, or more than 10,000 employees in France and abroad, must draft and implement due diligence plans. Plans must set out reasonable measures to identify risks and prevent serious abuse of human rights, fundamental freedoms, health, personal safety and the environment, arising as a result of the operations of the company, of companies under its direct or indirect control, or of subcontractors and suppliers with which it has well-established commercial relationships.
13. The Role of Public Agencies
The Agence Française de Développement (AFD)
… Also pursuant to Article 8, the AFD must incorporate social responsibility into its governance system and operations. It must implement measures to evaluate and control the environmental and social risks of the operations it finances, and to promote the financial transparency of businesses involved in these operations, country by country. Its annual report must mention the ways in which it addresses social responsibility requirements …
15. Economic Sectors and Human Rights
The Extractive Sector [page 34]
… France’s actions in [the extractive sector] focus on multilateral and European initiatives reinforcing the legal and regulatory framework for businesses working in the extractive sector, especially in regions with fragile governance systems …
II – Businesses’ Responsibility to Respect Human Rights
6. Reporting [page 44]
Businesses must monitor the human rights measures they adopt and disclose on theirinitiatives in this field.
Under European Directive 2014/95/EU, human rights will become one of the pillars of CSR. This position will be reflected in French reporting requirements when the directive is transposed into national law. It should be noted that human rights reporting is already a requirement under the regulatory provisions of the Commercial Code. Decree 2012-557 of 24 April 2012 on the social and environmental transparency obligations of businesses places human rights on an equal footing with other issues.
- France is continuing to implement monitoring indicators and communicate with external stakeholders on business commitments and enforcement under the UN Guiding Principles on Business and Human Rights.
Actions to be Implemented:
- Implement provisions to help transpose the European Directive on non-financial reporting into French law.
Objective 25.1.1: Ensure assessment of regulative influence on the market.
Objective indicator: Existence of document assessing influence on market of concrete area before introducing every concrete regulation.
- Creating working group conducting analysis about the influence of regulations on market.
- Defining conditions and criteria of expert participation in working groups.
- Conducting expert activities with the side initiating communication regulatory.
Responsible agency: Government of Georgia, The office of the Business Ombudsman of Georgia.
Partnership agency: Business sector; Global compact Georgia; CIDA.
Objective 25.3.1: Analyse existing situation regarding direct and indirect state involvement and define suggestions for creating effective mechanisms with the aim to prevent discrimination.
Objective indicator: Analytical document of existing situation through experts’ involvement.
- Planning actions of sharing recommendations and implementing them.
- Implementing agreed action plan.
Responsible agency: Administration of the Government of Georgia.
No partnership agency.
Objective 25.6.1: Elaborate appropriate amendment package concerning corporate social responsibility, including women strengthening principles.
Objective indicator: Elaborated legislative amendments package.
Activity: Researching mechanism of probable promotion concerning corporate social responsibility, including the principle of strengthening women.
Responsible agency: Ministry of Economy and sustainable development of Georgia in cooperation with parliament.
No partnership agency.
1.1 Basic rules of economic policy
Bi- and multilateral economic relations
Measures [page 18]
- “The EU Special Incentive Arrangement for Sustainable Development and Good Governance (‘GSP+’) can be used as a format for promoting the observance and application of human rights standards by governments of developing countries. In the forthcoming review process of 2018, the Federal Government will press for further strengthening of that instrument.”
The current situation [page 19]
“the Federal Government has undertaken to implement the Voluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries and Forests and has initiated a number of development cooperation projects to assist governments of developing countries in enforcing the land-tenure rights of marginalised groups, in strengthening stakeholders in civil society and in raising awareness among companies, for example those investing in agriculture, and gaining their support for the application of these guidelines with a view to preventing illegal actions such as land-grabbing.”
Enterprises in public ownership [page 26-27]
The current situation
“there is a federal regulatory instrument known as the Public Corporate Governance Code of the Federation (PCGK Bund), comprising recommendations and suggestions for good corporate governance and addressed to enterprises in which the Federal Government holds a majority stake. The federal administration of shareholdings is organised on a decentralised basis and is the task of whichever federal ministry is responsible for the company’s area of activity. Section 1.4 of the Public Corporate Governance Code states that the federal ministry responsible for the shareholding should ensure that enterprises acknowledge and comply with the Code and embody it in their corporate rules. The Code is part of the Principles of Good Corporate Governance and Management of Federal Holdings, which were adopted by the Federal Government and published by the Federal Ministry of Finance in its role as the lead body in this field. They form the foundations for responsible management of federal stakes in enterprises and provide for standardised performance of this task by the various federal ministries. Several federal states and municipalities have separate management codes for their own holdings.”
“The Federal Government, in cooperation with the Council for Sustainable Development, will expand the training courses of the federal holding management bodies to include sustainability matters and so focus its attention on responsibility for human rights in the enterprises in which it holds a direct majority share. The scope of the training curriculum of the holding management bodies shall be inserted as part of the next revision into the Public Corporate Governance Code of the Federation. At the annual meeting of the bodies managing federal and state holdings, the states shall be urged to follow this federal practice.”
Annex 1 – List of additional and ongoing actions to be carried out across Government
Development Cooperation to [page 21]
“21. Support developing countries to improve their business and investment environment and continue to promote transparent, accountable and effective governance systems, rule of law, and equitable and inclusive economic growth, including transforming economic opportunities and outcomes for women and girls.”
Section 3: Actions
I. Key commitments to ensure policy coherence across Government [page 16]
“Ensure coherence between the National Plan on Corporate social Responsibility and the National Plan on Business and Human Rights, including by promoting cooperation between the Business and Human Rights implementation Working Group and the Corporate Social Responsibility Stakeholder Forum”
- Department of Foreign affairs and trade, enterprise and innovation
The Irish NAP also provides information on due diligence (see the section on Due Diligence), and corruption (see the section on Corruption)
IV. Italian ongoing activities and future commitments
“The legality rating is an indicator of compliance with high standards of legality by companies. It is a tool introduced into Italian law by Decree Law No. 29 of 24 March 2012 in order to promote principles of ethical behavior in the business environment through the assignment of a recognition, measured in “stars”. These are indicative of the respect for legality by companies that have requested it and, more generally, the degree of attention paid to the proper management of their business. The rating is linked by law to advantages in the granting of public loans and facilities for access to bank credit.” (p. 16)
Responsible Conduct and Due Diligence in the framework of the United Nations, OECD and European Union
“Finally, in its Resolution of 10 March 2021, the European Parliament addressed to the Commission recommendations concerning Due Diligence and Corporate Responsibility for a future directive, which would contribute to preventing and mitigating potential or actual negative impacts of business action on human rights, the environment and good governance.” (p. 44)
Chapter 2. Action Plan
2. Areas of the NAP
(3) Measures of the Government Promoting Corporate Responsibility to Respect Human Rights
A. Measures Related to Domestic and Global Supply Chains and Promotion of Human Rights Due Diligence Based on the UNGPs
(Existing framework/Measures taken）
Japan’s Stewardship Code and Corporate Governance Code refer to grasping the status of investee companies and corporate information disclosure to promote sustainability initiatives, including elements of ESG issues. In addition, the Stewardship Code, which was revised again in March 2020 also includes reference to consideration on sustainability when holding dialogue between institutional investors and investee companies. Furthermore, the Guidance for Collaborative Value Creation was published as a guideline for dialogue and disclosure on voluntary and proactive initiatives of companies on non-financial information, including ESG factors.
|CHAPTER TWO: SITUATIONAL ANALYSIS AND THEMATIC AREAS OF FOCUS
2.4 Revenue Transparency [page 9]
[T]he NAP consultations identified several challenges that affect revenue transparency:
CHAPTER THREE: POLICY ACTIONS
3.1. Pillar 1: The State Duty to Protect
Policy Actions [Page 21]
The Government will:
x. Finalise the development of regulations to the Access to Information Act to facilitate disclosure of contracts, including those that have a significant economic and social impact in the country and join the Extractives Industries Transparency Initiative (EITI) for the facilitation of revenue transparency;
3.2. Pillar 2: Corporate Responsibility to Respect Human Rights
Policy Actions [Page 18-19]
b) Human Rights Policy commitments
The Government will:
i. Require businesses to adopt human rights policies, including taking measures to ensure their operations respect human rights, including by providing access to a remedy for human rights violations;
Enforce the requirement for businesses to prepare non-financial reports in line with the Companies Act, 2015, and encourage proactive disclosure of their impacts on human rights and the mitigation measures they are taking in this regard.
Objective 1: ensuring State’s duty to protect, defend and respect human rights
A. Legislative measures [page 1]
2. “Reforming legal regulation regarding administrative liability. The aim is to regulate individual administrative liability in the Republic of Lithuania, to separate it from criminal liability, ensuring the main features of the administrative liability: simple fast-track process, preference to non-repressive impact measures, and their adequacy to the committed offence, thus increasing effectiveness of these measures.
The measure is carried out with a view to improving the Draft Code of Administrative Offenses of the Republic of Lithuania, submitted for deliberation to the Seimas of the Republic of Lithuania on 7 June 2012.”
Objective 2: promoting corporate responsibility and respect in the field of business and human rights
A. Implemented and on-going measures for the development of CSR in Lithuania [page 6]
3. “The application of CRS principles to the state-owned enterprises … It was foreseen that state-owned enterprises (hereinafter referred to as the SOE) operating under the principles of good governance may act as examples of socially responsible business. To this end, since 2010, actions were taken to restructure SOEs with a particular focus on corporate transparency and social responsibility.”
‘Luxembourg’s NAP does not explicitly address this issue’
The 2020-22 NAP states the second edition of the National Action Plan complements the first NAP. Additional information about the first NAP can be found here.
‘The Mexico NAP does not explicitly address this issue’
3.4 Transparency and reporting
Reporting [page 30]
“The government continues to call companies’ attention to the need to comply with the Corporate Governance Code and the principle that members of the management and supervisory boards should take account of CSR in fulfilling their duties. The government has pointed out that CSR should be part of the entrepreneurial spirit. It is therefore essential to devote serious attention to CSR within the existing structures and responsibilities of the management and supervisory boards. Their reports should also include more information on their CSR policies.”
Summary [page 8]:
Norway already has sound legislation for safe guarding human rights. In many fields processes have already been started and changes made that are relevant to UN and OECD instruments, for example the Government’s state ownership policy, corporate governance of the Government Pension Fund Global and a number of measures implemented by diplomatic and consular missions.
1. Global developments and CSR
1.3 CSR in the Norwegian business sector [page 10]:
The Norwegian Corporate Governance Board (NUES) has published recommendations that have to be followed by all companies listed on the Oslo Stock Exchange.
2. The State Duty to Protect Human Rights
GP3 [page 18]:
In meeting their duty to protect, States should: (…) Ensure that other laws and policies governing the creation and ongoing operation of business enterprises, such as corporate law, do not constrain but enable business respect for human rights.
CHAPTER 2: National Action Plan Priority Areas and Proposed Actions
3.2. NAP Priority Areas
3.2.1 | Financial Transparency, Corruption and Human Rights Standards in Public Procurement Contracts (page 18)
‘As established during the NBA and consultative process, lack of financial transparency especially in relation to corruption and bribery are prevalent in Pakistan. These have a direct correlation with human rights as the lack of financial transparency contributes to money laundering, terror financing and tax evasion, which negatively impact social development programmes and human rights. Additionally, the nexus between corruption and the adverse impact on human rights needs to be explicitly highlighted in legislation and policies, and in the working of law enforcement bodies.
Various laws and regulations have been introduced by the State of Pakistan to curb corrupt practices and activities involving bribery. Similarly, enforcement mechanisms have also been established to ensure the effective implementation of the laws and regulations prohibiting corruption and activities involving bribery. […]’
- Federal (page 18)
‘9. Pass the Whistleblower Protection and Vigilance Commission Bill 2019 to ensure protection of whistle-blowers disclosing information related to financial discrepancies and corruption.
Performance indicator(s): Enactment of the Whistleblower Bill
UN Guiding Principle(s): 1, 3
Relevant SDG(s): Goal 16 – Peace, Justice and Strong Institutions’
This information is also covered under Appendix I: Implementation Plan, Proposed Action 9 designating the Ministry of Human Rights and the Ministry of Law and Justice as Leading Entities (page 46).
’12. Further strengthen judicial processes and create awareness on issues related to Anti-Money Laundering/Counter Terror Financing (AML/CTF) to encourage financial transparency.
Performance indicator(s): Number of trainings on AML/CTF
UN Guiding Principle(s): 1, 2, 3, 25
Relevant SDG(s): Goal 16 – Peace, Justice and Strong Institutions’
This information is also covered under Appendix I: Implementation Plan, Proposed Action 12 designating the Ministry of Human Rights, the Ministry of Law and Justice and the Anti-Corruption and Economic Crime Wing (Federal Investigation Agency) as Leading Entities, and designating the National Accountability Bureau, the Securities and Exchange Commission of Pakistan, the State Bank of Pakistan, the Provincial Home Departments, the Provincial Law Departments, the Supreme Court of Pakistan, the High Courts, the District Courts, the Federal and Provincial Judicial Academies, the Federal and Public Service Commissions, the Anti-Narcotics Force, the Anti-Terror Courts, the Provincial Anti-Corruption Bodies as Additional Entities (page 46).
ANNEX II: Actions Already Undertaken by Pakistan
A. General Measures Relevant to Business and Human Rights (page 72)
‘The Public Sector Companies (Corporate Governance) Rules 2013 have been promulgated, which require that a Code of Conduct be created which articulates acceptable and unacceptable behaviour, and ensures that adequate systems are in place for the identification and redressal of grievances from unethical practices.’
B. Measures Relevant to NAP Priority Areas
i. Financial Transparency, Corruption and Human Rights Standards in Public Procurement Contracts (page 73)
‘The Public Procurement Regulatory Authority has also been established at a Federal and Provincial level to assess procedures and take measures to improve governance, management, transparency, and accountability of all work related to public procurement. Should any changes require specific laws or rules, the Authority can recommend new laws and policies to the State to be enacted.’
‘Pursuant to Pakistan’s grey-listing by FATF, several laws and guidelines relating to AML/CTF have been passed. The Financial Monitoring Unit has been set up to investigate cases of suspicious transactions. The regulations and policies promulgated by the State in this regard aim to enhance financial transparency of different business entities.’
THE BUSINESS AND HUMAN RIGHTS SITUATION IN PERU
Some specific sectors have adopted RBC approaches to a greater extent, such as mining, hydrocarbons, energy, and agriculture. In 2002, the SNMPE approved a Code of Conduct, which has been developed over the years with the incorporation of new principles in 2016 and 2018. Through this, SNMPE members declare, among other issues, that their activities seek to contribute to sustainable development and promote and implement environmental protection practices, and that these should be carried out following principles of corporate governance, transparency, and anti-corruption, and respect and promote human rights.
A 2019 study prepared by Confiep (2019) with support from the ILO identified the good practices of the business sector in terms of human rights in Peru, based on information reported by 252 companies between 2016 and 2017. Regarding corporate commitments to human rights and other related policies, the sample evidenced the following: 5% stated their alignment with the Guiding Principles, 7% adopted human rights policies, 31% declared having human rights declarations, and 57% did not report specific information on human rights (Confiep, 2019, pp. 13-15). Regarding their corporate policies, those identified are related to labor rights (86%), supply chains or suppliers (75%), the environment (71%), and communities and local development (63%) (Confiep, 2019, pp. 18-19). Of the companies analyzed in the study, 63% reported having integrated management systems and 79% with risk management tools (Confiep, 2019, pp. 15-17), which contribute to due diligence. – page 32
In the area of mining, the Responsible Mining Founding report (RMF & Centro Vincular-PUCV, 2020) evaluates mining companies based on their policies and practices concerning economic, environmental, social, and governance issues, scoring each category from 0 to 6. – page 34
In terms of transparency and integrity, it is necessary to have specific trade union instruments on the implementation of integrity and anti-corruption policies in the value chains. In this regard, the initiative to adopt codes of ethics and the explicit anti-corruption commitment adopted by associations such as Confiep should be highlighted. Likewise, progress must be made in the implementation of corporate mechanisms for participation and access to information, especially on conflicts of interest and income and asset declaration systems for internal and external agents. – page 37
CHAPTER III DIAGNOSIS AND BASELINE: ACTION AREAS
3.2. Conclusions of the specific issues
Transparency, integrity, and fight against corruption
In recent years, the conviction has been established that corruption cuts across different areas and has a direct and unacceptable impact on human rights. For this reason, the State has signed the main treaties on the subject, which it has been implementing in its internal regulations through a National Policy and a National Integrity and Anti-Corruption Plan. It has also created integrity offices or units at the central government level, which has made relative progress at the sub-national level. In terms of transparency, progress has been made with measures such as the mandatory presentation of the declaration of interests. On the other hand, it is also necessary to strengthen the autonomy and effectiveness of the National Transparency Authority. Likewise, it is necessary to strengthen the public procurement model to include incentives for companies that meet integrity standards, as determined by the evaluation of the state of the art of the GP-RBC approach in the public procurement system, which will be carried out within the framework of the implementation of the NAP.
From the business sector, there is an explicit commitment of the unions to articulate their efforts with public policy on the matter. Proof of this are measures such as the Technical Secretariat of the Global Compact, the incorporation of SDGs in business work, the Private Anti-Corruption Council, the Ethics Committee, the Code of Conduct, the participation of important business associations in the High-Level Anti-Corruption Commission, the Transparency Initiative in the Extractive Industry, among others. Regarding reparation mechanisms, progress has been made in incorporating the administrative responsibility of companies for corruption offenses, which should be complemented with expeditious and accessible reparation procedures and a system of precautionary measures or guarantees of non-repetition. – page 43
Environmental Impact Assessment (EIA)
The formal business sector has generated good practices to be considered in the construction of a public policy on business and human rights and RBC. This should promote and guarantee corporate due diligence mechanisms from the formulation of the EIA, being strengthened by transparency mechanisms, training, multi-stakeholder dialogue, risk identification, complaints, among others, as recommended by the UN System, the Inter-American System, and the OECD. – page 49
Business associations in the sector, such as AGAP, have implemented good corporate practices, such as the adoption of codes of conduct, crime prevention policies, and measures against Covid-19, among others. However, there is no information from the public policy on their implementation, so it is necessary to generate public policy mechanisms to promote due diligence and reporting of these advances to the competent state sectors, as well as to strengthen the channels of complaint and internal human rights policies of the companies. – page 50
Table 8: NAP strategic guidelines and objectives, and alignment with the axes of the Peru Vision 2050
Strategic guideline No. 1: Promotion and dissemination of a culture of respect for human rights in the business environment in accordance with the framework of international standards of the guiding principles and other international instruments.
Objective No. 1: Officials, managers, and public servants incorporate the guiding principles and other related international instruments in public management, specifically in the service they provide.
Action: To implement training on GP-RBC and other international standards, from the governing body of the corresponding entity, aimed at its officials, managers, and public servants
Background: In order to guarantee a permanent state training and awareness-raising effort for officials, managers, and public servants at all levels, each entity of the Executive Branch will progressively implement training initiatives on GP-RBC that meetthe particular institutional needs, taking into account, to the extent necessary, the context of the health emergency caused by Covid-19. For this purpose, the entities may coordinate with MINJUSDH, to articulate technical and/or financial support with international organizations and international cooperation.
Indicator: Annual progress report on the implementation of training initiatives. – page 57
Strategic guideline No. 3: Design of public policies that promote respect for human rights by companies through accountability, investigation, and sanction for the impacts of their activities.
Objective 1: Promote policies and/or standards that guarantee respect for human rights in business activities.
Action: Institutionalize intersectoral coordination through the creation of a permanent coordination space, made up of directors of the Executive’s Social Management Offices
Background: Create a space for coordination with the directors of the social management offices to periodically analyze the different social conflicts registered in the Peruvian territory, establishing lines of action and proposing strategies to address the conflict in which situations that could constitute violations in terms of business and human rights are identified on time.
Indicator: Standard for the creation of the permanent intersectoral coordination space. –page 105
Objective No. 2: Technical assistance to companies for the observance of human rights in their business activities
Action: Promote the implementation of compliance and corruption prevention mechanisms, considering the GP- RBC approach.
Background: It consists of generating spaces for discussion on the benefits of corporate compliance, as well as providing support to the business sector, both private and public, for the implementation of these corruption prevention schemes.
Indicator: Number of activities to disseminate and promote the measure. – page 109
Strategic guideline No. 4: Promotion and design of due diligence procedures to ensure the respect of human rights by companies
Objective 2: Establish mechanisms for companies to report on their human rights due diligence processes.
2017-2020 NATIONAL ACTION PLAN
Pillar II: The corporate responsibility to respect human rights
2. Dialogue and exchange of knowledge and experience in implementing CSR [page 29]
“There are four categories of corporate activities that relate to corporate social responsibility: corporate governance, employees, the environment, and the product”.
2021-2024 NATIONAL ACTION PLAN
|10. Ministry of Culture, National Heritage and Sports
Implementation of the equal-treatment policy in sports
3. Promoting the participation of women in management structures of Polish sports associations and encouraging them to implement the recommendation following from the Good Governance Code for Polish Sports Associations (PZS), which indicates that women should constitute at least 10% of the PZS board composition if women account for more than 30% in national teams managed by the given PZS and at least 30% if there are more than 50% women in national teams.
Although the Good Governance Code for PZS is a non-legislative tool and does not constitute a source of rights or obligations directly for the addressees, it provides an opportunity to promote desirable models without interfering with the autonomy of the sports movement. – page 29
2. Ministry of Development Funds and Regional Policy
Responsible business – promoting due diligence standards
The effectiveness of activities carried out so far in the form of cooperation within the Advisory Board for Sustainable Development and Corporate Social Responsibility encourages further development of the initiative and dialogue with representatives of various institutions and sectors. Therefore, the activities of the Advisory Board for Sustainable Development and Corporate Social Responsibility will be continued in the years to come. Within the framework of the Advisory Board’s work, plans involve a continuation of activities in the field of promoting standards related to respect for human rights in business activity of enterprises. A significant role in this respect will be played by the Working Group for Relations with Individuals Performing Work. The scope of tasks of the Working Group will be determined each time by the Advisory Board for Sustainable Development and Corporate Social Responsibility within the framework of annual action plans. The plans of the Working Group include, among others, the following activities:
· promotion of the handbook entitled: “CSR Guidebook to Safe and Sustainable Work Environment” consisting in distribution of the handbook in both electronic and printed versions and by establishing cooperation with centres and institutions dealing with the labour market in Poland in order to discuss the issues included in the handbook and the needs for changes in the Polish labour law system, – page 10
The issue of due diligence in the field of human rights will also be of particular interest to the Advisory Board for Sustainable Development and Corporate Social Responsibility in view of the legislative changes planned at the EU level as regards due diligence in the area of human rights and environmental issues, as well as in the field of non-financial reporting covering, among others, issues concerning the respect for human rights. Monitoring the directions of legislative changes in non-financial data reporting planned at the EU level, as well as work in areas related to non-financial reporting, constitutes one of the tasks of the Working Group on the Development of Non-financial Reporting established on 31 March 2021. – page 11
Respect for human rights in the business sector is also required by the laws governing corporate liability for damages, ownership relations, consumer protection, the fight against corruption, and privacy protection. (pg. 10)
Principle 3(d) – Non-financial reporting
Slovenia has adopted a new legal regulation aimed at increasing the transparency of certain companies and at improving the adequacy, convergence and comparability of non-financial information, increasing the transparency and consequently the diversity in their administrative, management and supervisory bodies, increasing corporate responsibility and efficiency and thereby the effectiveness of the single market, and at improving corporate management. (pg. 21)
[T]o create a transparent, effective and clear management system which fosters the trust of investors, employees and the general public in the corporate management system, Slovenia has extended the list of companies which are required to include non-financial statements in their annual reports. (pg. 21)
Principle 5 – Oversight
The Slovenian development cooperation is aimed at enhancing human rights in developing countries, whereby good governance and strengthening the rule of law, including respect for human rights and equal opportunities, are classified as horizontal or multi-sectoral fields of activity. (pg. 25)
Principle 10 – Basic Principles
Slovenian representatives participate on the board of directors, Slovenia will continue to cooperate actively in accordance with the EBRD’s fundamental principles relating to respect for human rights. (pg. 33)
Annex – Human Rights Due Diligence in Practice
Human rights are a significant element of corporate social responsibility and as such have to be incorporated into risk management and management reviews. (pg. 46)
C. Current Status
1. Domestic Status [page 3]
- Increased discussion of corporate social responsibility as a result of human rights issues such as low wages, child labor, poor working environment and forced migration of indigenous people in the management process of multinational corporations.
- Following the adoption of the ‘UN Guiding Principles on Business and Human Rights’ in 2011, various follow-up measures are being pursued to realize the guiding principle internationally.
- Description of the expiration dates of the comprehensive policy for sustainable management by amending the 「Industrial Development Act」 on December 2017.
* Article 19 (Comprehensive Policies for Sustainable Management)
(1) The Government shall formulate and implement comprehensive policies every 5 year to encourage corporations to promote activities for sustainable management that takes into account economic profitability, environmental soundness, and social responsibility.
- According to ‘Operation Rules for National Contact Point (NCP) for Implementing OECD Guidelines for Multinational Enterprises’ enacted in 2001, NCP was established within the Ministry of Trade, Industry and Energy. But considering the fact that it is insufficient to prevent human rights violations of corporations, NCP amends operational rules and strengthens the diversity and professionalism of its members.
2. Implementation of the Second NAP [page 4]
- Promotion of social responsibility, including respect for human rights in managerial activities.
– Publication of operating casebook of Creating Shared Value Forum and opening of training course for experts of corporate social responsibility and creating shared values.
– Revision of 「Procurement Business Act」 and addition of an article promoting corporate social responsibility on January 2016.
- Improvement of OECD Guidelines for Multinational Enterprises National Contact Point (NCP).
– Held meetings and seminars for overseas Korean companies to promote the implementation of OECD Guidelines.
– Operated NCP website (www.ncp.or.kr) and opened English website.
– Diversified the composition of the members as requested in the OECD Guidelines and professionalized the operational procedures.
D. Tasks for the Third NAP
Institutionalization of Human Rights Management
1. Secure corporate responsibility on human rights [page 4]
- Express expectations of corporate responsibility on respecting human rights in a way that can be effectively communicated to corporations in order to fulfill their responsibilities in respect of human rights.
– Express expectations of corporate responsibility on respecting human rights through its official website. (declaration)
(1) All corporations within the territory or jurisdiction of Republic of Korea, regardless of its size or location, should implement the corporate responsibility on respecting human rights defined by UN Guiding Principles.
(2) To the extent possible, corporations should pay attention to prevent human rights violations happening at supply chain such as business partners or supplying companies.
(3) Government should provide necessary support and legal, policy, and institutional arrangements for corporations to fulfill their human rights responsibilities.
2. Establish and implement measures for corporate sustainability management [page 5]
- Reflect ‘respecting human rights·prohibition on discrimination’ ‘work-life balance’ on the criteria of factual survey on corporate sustainability management and reward assessment.
- Include corresponding strategy about making global standard and norms of corporate sustainability management.
II. Antecedent and Context
Human rights are one of the elements that comprise Corporate Social Responsibility along with others such as social elements; environmental elements; also those relating to the balance of work and family life; good governance; and transparency.
Guiding Principle 2
“The self-regulation codes will also be promoted, taking as an example relevant sector experiences, such as the Global Code of Ethics for Tourism of the World Tourism Organization (WTO) or the Code of Conduct for the protection of children and adolescents against sexual exploitation in the Tourism and Travel Industry, as well as the relevant labor conventions of the ILO.”
“The Government will establish networks among Spanish companies or that the ones that operate in Spain for the promotion of: measures, procedures or internal systems that can effectively contribute to the prevention and/or mitigation of the negative consequences of business activities on human rights; as well as for the dissemination of good practices aimed to avoid these consequences, or to influence their avoidance, reduction or remedy. The establishment of procedures for internal assessment and determination of action will be promoted in a manner that avoids other negative consequences on human rights.”
“The Monitoring Commission will design and submit to the Government the adoption of an incentive system that includes both large companies and Small and Medium Enterprises (SMEs) that carry out policies in the field of human rights. These incentives may be economic, commercial, visibility and image, or other nature, to encourage companies to have policies and reliably certify that they have implemented adequate procedures at a global level according to their size and circumstances, namely:
A public commitment to assume its responsibility to respect human rights in accordance with the provisions of the Principle no. 16;
A process of due diligence aligned with the sectorial guides regarding the OECD (due diligence guidance), and based on the dialogue with stakeholders that allows identification, prevention, mitigation, and accountability of how they address the impact of their own activities and those that are directly related to their business relationships in accordance with the provisions of Principles no. 17 to no. 21;
Some processes that allow to remedy all the negative consequences on human rights that have caused or contributed to provoke according to what is established in Principles no. 22, no.29, no. 30, no. 31.”
Guiding Principle 3
In order to increase transparency, and the confidence of consumers and investors on Spanish companies, the Government will compile the reports that companies write voluntarily, in accordance with the Spanish Strategy for Corporate Social Responsibility, and the Article 39 of the Sustainable Economy Law. It will be encouraged that these take into account the impact of their activities on human rights, including the value chain, introducing a specific chapter for that purpose. Likewise, and in relation to the reports and reports mentioned in the article 35 2 a) of the Sustainable Economy Law, which binds state business corporations, and public business entities attached to the General State Administration, it will be promoted the inclusion of a section on human rights. In addition, the transposition of Directive 2014/95 / EU on disclosure of non-financial information and information about diversity by certain large companies and certain groups will be carried out.
Guiding Principle 28
“The Government will promote the development of practical guides and compile good practices on the establishment of grievance mechanisms managed by companies themselves that respect the criteria identified in Guiding Principle 31.”
Guiding Principle 30
“The Government will support the development of effective mechanisms for access to remedy in the collaborative mechanisms it participates in in accordance with the criteria identified in Guiding Principle 31.”
“The Government will publish the recommendations that are appropriate for the companies to establish or participate in the effective operational level grievance mechanisms available to the individuals affected by their negative consequences.”
The three pillars of the UN Guiding Principles on Business and Human Rights [page 6]
“A clear Swedish profile in this area can contribute to strengthening Sweden as a brand. The Guiding Principles are also fundamental to the corporate governance of state-owned enterprises.”
1 The State duty to protect human rights [page 11]
Criminal law provisions to protect human rights
“Sweden has a number of criminal law provisions for the protection of human rights regardless of the context in which an offence is committed, including in the business context. Through these criminal provisions Sweden also fulfils its international commitments in relevant respects. Examples include: …
Corporate fines entail liability for companies, among others. Although only natural persons can be convicted of a crime, corporate fines may be imposed on a business operator (e.g. a legal entity) for crimes committed in the exercise of business activities. (Chapter 36, Penal Code).”
Annex: Measures taken [page 23-24]
The State as owner
- “According to the government state ownership policy, state-owned companies are expected to set a good example, which means that they must seek to comply with international guidelines such as the UN Global Compact, the UN Guiding Principles on Business and Human Rights, and the OECD Guidelines for Multinational Enterprises. They must also be transparent and report in accordance with the Global Reporting Initiative (GRI). State-owned companies must also identify areas of CSR that are relevant to their business strategy and the board of directors must set strategic sustainability targets. The ownership policy applies in companies where the State is the majority owner; in other companies, where the State is part-owner, the State seeks to ensure that the ownership policy is followed, in dialogue with other owners.
- The Government has held seminars for the chairs of boards and managing directors of all state-owned companies on the Government’s expectations regarding the companies’ application of the UN Guiding Principles on Business and Human Rights. A study was carried out in 2013 on the international guidelines from the UN and the OECD, aimed at facilitating companies’ application of the state ownership policy. …
- A business analysis tool that sheds light on relevant areas of CSR, including human rights, has been developed for state-owned companies by the Government Offices corporate management organisation. The analysis increases the owner’s awareness of the companies’ risks and opportunities and how these can be managed. The result of the analysis is integrated in corporate governance and taken into account in the Government’s regular dialogue with the company, in monitoring the company’s development, and in the recruitment and nomination of board members.
- Like other state-owned companies, Swedfund International AB (Swedfund) and the Swedish Export Credit Corporation (SEK) are required to comply with the government state ownership policy for CSR, as described above. Moreover, Swedfund and SEK have social mandates specially adopted by the Riksdag. Swedfund is required to ensure that its investments comply with international standards and CSR principles, within clear and sound corporate structures that do not contribute to tax evasion, money laundering or terrorist financing. SEK is required to take account of conditions such as the environment, corruption, human rights and working conditions in its credit assessments.”
Annex: Measures planned [page 27-29]
Regulations and legislation
- “The interim report Implementation of the EU’s new accounting directive (Swedish Government Official Reports 2014:22) proposes enhanced transparency regarding payments made by some companies active in the extractive industry and in the logging of natural forests. The provisions will require companies to publish annual reports on payments made to authorities in the countries in which they operate. The aim is to combat corruption.”
- The EU has adopted a Directive amending the Accounting Directive on disclosure of non-financial and diversity information. Corporate disclosure of sustainability and diversity policy (Ministry Publications Series 2014:45) proposes that certain companies prepare a sustainability report providing information on, for example, respect for human rights and anti-corruption activities. It is also proposed that the corporate governance reports of certain listed companies disclose the diversity policy that applies to their board.”
The State as owner
- “CSR will continue to be an integral part of the Government’s active corporate governance of state-owned companies. The human rights work undertaken by state-owned companies will be examined in relevant cases in the sustainability analysis and followed up in stakeholder dialogues between representatives of the owner and the companies.”
“The Government’s clear expectation is that companies operating in Sweden or abroad comply with the UN Guiding Principles for Business and Human Rights and other relevant guidelines in this area, and review their due diligence and redress mechanisms. Companies operating in markets where human rights challenges are particularly serious should place special emphasis on work in the area.”
The Swiss NAP does not make an explicit reference to Corporate law and corporate governance
III. The state duty to protect human rights
B. Actions taken
- Voluntary commitment to implementation of international covenants (page 6)
‘The Taiwan government has committed to fully implement human rights both at home and abroad. […] although Taiwan is not a member of the United Nations, it has nevertheless signed and ratified important United Nations human rights covenants in recent years, including the […]”Convention against Corruption.”’
- Business-related human rights safeguards in Taiwanese legislation (page 7)
The Taiwan government has already incorporated the […] “Convention against Corruption,” and other such UN covenants and conventions into domestic legislation, so they can be directly applied as Taiwan law.’
IV. The corporate responsibility to respect human rights
B. Actions taken
- Greater information transparency (page 13)
‘Since 2014, the Taiwan government has used legislation to require listed companies matching a certain description to prepare a CSR report each year, and as of 2020 our government — making reference to the non-financial disclosure rules and practices of financial markets around the world — has included […] corporate governance matters in its disclosure requirements in order to ensure that the key performance indicators in non-financial disclosures are more closely linked to the way a company is managed.’
This information is also covered under Appendix 4: Overview of the implementation of the state duty to protect and the access to remedy, The state duty to protect, UNGP3, Actions taken (page 41).
[…] In response to the Taiwan government’s call for companies matching a certain description to prepare a CSR report each year, many private groups and organizations have also begun to assess the quality of CSR reports. For example: (a) A well-known magazine that has adopted the IFRS reporting standards carries out annual assessments of the quality of company CSR reports and presents awards to recognize the best ones. (b) There is a private think tank that collaborates with academia to issue the Taiwan Corporate Sustainability Awards each year, encourage the public to accept volunteer training and participate in the evaluation of enterprise sustainability reports and ESG comprehensive performance, spur enterprises to improve information transparency. Also, in response to the Sustainable Development Goals (SDGs), our government has set up a number of corporate excellence awards to recognize strong performance in such areas as transparency and business ethics, gender equality, and talent development. The purpose is to get companies to strengthen disclosure of non-financial information and implement human rights policies.’
C. Actions planned
- Advocate for disclosure of non-financial information (pages 14-15)
‘In addition to studying the feasibility of expanding the range of businesses subject to a compulsory requirement to prepare CSR reports, the Taiwan government will also advocate for disclosure by businesses of non-financial information (related issues will include important environmental, social, and governance (ESG) topics — such as the use of consumer information, the use of energy, waste handling, labor conditions, environmental protection, forced evictions, indigenous land rights, gender equality, and consumer protection measures — all of which are matters of concern to stakeholders). The goal of such a policy would be to ensure that businesses understand that the disclosure of non-financial information can make up for the shortcomings of financial information, thus enabling businesses to effectively identify and manage risks. This would facilitate the formulation of better business policies, and contribute to the achievement of forward-looking objectives, thus enabling the adoption of sustainable business practices.’
This information is also covered under Appendix 4: Overview of the implementation of the state duty to protect and the access to remedy, The state duty to protect, UNGP3, Actions taken (page 41).
V. Access to remedy
B. Actions taken
- Actions taken
Extraterritorial jurisdiction (page 18)
‘With respect to any human rights abuses that occur overseas, Taiwan already has laws and regulations which provide that such abuses are subject to the jurisdiction of Taiwan’s judicial authorities no matter where the abuses have taken place. For example, if a responsible person or an employee of a company […]offers a bribe to a public servant from Taiwan or a foreign nation in connection with cross-border trade, investment, or other business activities (as referred to in Article 11 of the “Anti-Corruption Act”), the offense will be subject to the jurisdiction of Taiwan’s judicial authorities regardless whether the offense is punishable or not under the law of the land where the crime is committed.’
Appendix 1: Concrete actions taken by Taiwan to fulfill the state obligation to protect
- Taiwan’s commitment to human rights and international participation (pages 23-24)
‘The “Act to Implement the United Nations Convention against Corruption,” which entered into force on 9 December 2016, was enacted in response to international trends and challenges in the fight against corruption. Our government issues periodic reports on the state of Taiwan’s implementation of the UN Convention against Corruption.’
- Promotion of corporate social responsibility (pages 26-28)
‘The government may incorporate legally binding non-financial reporting requirements to ensure that companies conduct human rights due diligence. Article 10, subsection 4, item E of the “Regulations Governing 27 Information to be Published in Annual Reports of Public Companies” provides that corporate governance reports shall address CSR elements, such as environmental protection, community participation, social contribution, social services & welfare, consumer rights, human rights, and health & safety.’
‘The Taiwan Stock Exchange (TWSE) has issued the “Taiwan Stock Exchange Corporation Rules Governing the Preparation and Filing of Corporate Social Responsibility Reports by TWSE Listed Companies,” and the Taipei Exchange (TPEx) has issued the “Taipei Exchange Rules Governing the Preparation and Filing of Corporate Social Responsibility Reports by TPEx Listed Companies.” If a listed company is in any of the following circumstances, it shall prepare and file a corporate social responsibility report in Chinese according to these Rules: (a) the company is in the food industry, chemical industry, or financial industry; (b) no less than 50 percent of the company’s total operating revenue is derived from food and beverages; or (c) the company’s capital stock is not less than NT$5 billion. A listed company to which the above descriptions apply shall prepare a corporate social responsibility report for the preceding year, making reference to the Global Reporting Initiative (GRI) Standards and the Sector Disclosure documents issued by the GRI.’
‘To strengthen corporate governance, the TWSE and the TPEx have issued several codes of best practice, including the following:
“Corporate Social Responsibility Best Practice Principles for TWSE/GTSM Listed Companies”: Listed companies are expected to implement CSR measures to manage their economic and environmental risks and impacts.
“Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies “: Listed corporations are required to establish a corporate culture built upon good management and integrity. Corporations shall also consider the background of their suppliers. Corporations are expected to act with high integrity.
“Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies”: Listed companies are expected to establish good corporate governance systems and respect the rights and interests of all stakeholders.’
Appendix 2: Concrete actions taken by Taiwan to ensure respect by businesses for human rights
- In order to strengthen enterprises’ CSR implementation and enhance human rights awareness, the Taiwanese government and civil society have implemented a number of support measures, including the following: (page 33)
‘In order to promote the development of a sustainable investment environment, TWSE subsidiary Taiwan Index Plus Corporation and FTSE Russell jointly released the “FTSE4Good TIP Taiwan ESG Index,” the first ESG index that fully integrates environmental, social, corporate governance, and financial indicators in Taiwan.’
Appendix 3: Concrete actions taken by Taiwan to provide effective remedy systems
- Extraterritorial jurisdiction
Article 11 of the “Anti-Corruption Act” provides that a public servant who offers (in connection with cross-border trade, investment, or other business activities) to bribe a public servant from Taiwan, the Chinese mainland, Hong Kong, or Macao shall bear criminal liability, and the offender will be dealt with according to the provisions of the “Anti-Corruption Act” regardless whether the offense is punishable or not under the law of the land where the crime is committed.
3.The core content of the National Action Plan on Business and Human Rights
3.1 Action plan on labour
3.1.3 Action Plan (2019–2022)
Pillar 1: State duties in protecting (Protect)
|Responsible agencies||Time-frame (2019–2022)||Indicators (wide frame)||Compliance with National Strategy/ SDGs/UNGPs|
|15.||Operations set for business sector||Regulate, supervise and require the large business sector and companies listed in the stock market that use migrant labour as their primary production resource, prepare a Human Rights Due Diligence report as a measure in deterring labour exploitation. The said report must be disclosed to the public in order to create awareness and be easy to review. This is important for transparency and traceability in accordance with good corporate governance.||– Ministry of Industry
The Office of the Securities and Exchange Commission
|2019–2022||Letter circulated to the companies listed in the Stock Exchange of Thailand for disseminating the report on Human Rights Due Diligence||– National Strategy for National Competitiveness Enhancement
– SDG 8 and 12
– UNGPs Articles 1, 3, 4, 5, 7, 17, 18 and 19
Pillar 2: Responsibilities of the business sector in respecting of human rights
2.1 Compliance with labour laws, the Thai Labour Standards and the principles of human rights
- State enterprises and the business sector must provide an announcement or a statement on the human rights policy in their organizations. This includes the UNGPs
|Responsible agencies||Time-frame (2019–2022)||Indicators (wide frame)||Compliance with National Strategy/ SDGs/UNGPs|
|4.||Special Economic Zones||Consider making guidelines or measures for Special Economic Zones (SEZs), including the Eastern Economic Corridor (EEC) so they adhere to the highest standards of good governance and the guideline of the corporations while the commitment to implement UNGPs should be reflected in the establishment and management of the SEZ and EEC||– Office of the National Economic and Social Development Council
– Ministry of Commerce
– Ministry of Industry
– Ministry of Interior (Department of Public Works and Town and Country Planning)
|2019–2022||Guidelines and measures for the Special Economic Zones (SEZs), including the Eastern Economic Corridor (EEC) to comply with the highest standards of good governance and UNGPs||– National Strategy for Eco-Friendly Development and Growth
– National Strategy for Public Sector Rebalancing and Development
– SDG 11, 13, 14 and 15
– UNGPs Articles 1, 3, 4, 5, 7, 8, 10 and 31
CHAPTER FIVE: INSTITUTIONAL FRAMEWORK
5.10. UWA, UNRA, NEMA, AND NFA
iii. Ensure that businesses under take ESIA prior to commencement of businesses operations and conduct annual audits.
5.13. Private Sector
ii. Ensure that the corporate policies and plans including practices are compliant with the action plan.
The UK 2013 NAP provides in the section detailing The existing UK legal and policy framework that [page 9]:
“The UK has created or endorsed a number of instruments that motivate different aspects of good corporate behaviour and respect for human rights. These include:
- the UK Bribery Act where, in line with our OECD commitments, UK companies are now liable in the UK for acts of bribery committed anywhere in the world;
- the Declaration on Fundamental Principles and Rights at Work adopted in 1998 and the 8 core ILO Conventions ratified by the UK on labour standards;
- the OECD Guidelines for Multinational Enterprises, where the UK is generally recognised as having one of the most effective National Contact Points;
- Section 172 of the Companies Act 2006, which makes it clear that, in fulfilling their duty to act in a way which they consider would be most likely to promote the success of the company, directors must think about matters which might have a bearing on that success, including the interests of the company’s employees and the impact on the community of the company’s operations.
The UK 2016 Updated NAP reiterates these instruments [page 7] and makes an implicit reference to corporate law and governance when it raises the issue of the Modern Slavery Act which regulates reporting obligations of certain companies.
The UK 2016 Updated NAP also notes in the chapter on UK Action Plan implementation and further development that [page 24]:
“A non-exhaustive list of the different mechanisms for the promotion of good corporate behaviour, together with the Government departments that lead on them, is available on the online copy of this paper, found at https://www.gov.uk/government/publications/bhr-action-plan”
The U.S. NAP includes a substantial amount of information on this issue, focused largely on corruption and transparency.
Outcome 1.1: Promoting RBC Globally
New Actions [page 8]
“Corruption Consortium: An important deliverable from the International Anti-Corruption Summit held in the United Kingdom in May 2016, State and the U.S. Agency for International Development (USAID) will launch the Global Anti-Corruption Consortium (GACC), a new initiative to support international efforts to expose corruption, raise public awareness, and facilitate action by government, law enforcement, and multilateral organizations. GACC will expand the quality and scope of civil society investigations and reporting by mentoring investigative journalists and facilitating collaboration among anticorruption civil society actors. The initiative will improve civil society’s ability to pursue action by government and international bodies to combat corruption.” – Implementing Department or Agency: State, USAID
Ongoing Commitments and Initiatives [page 8]
“Inter-American Convention Against Corruption: The United States will continue to actively support implementation of the Inter-American Convention Against Corruption, including through active participation in the country review process” – Implementing Department or Agency: DOJ, State, Treasury, Commerce
“Asia–Pacific Economic Cooperation (APEC): The U.S. government has played an important role in numerous APEC initiatives to combat corruption, including the recent APEC Principles on the Prevention of Bribery and Enforcement of Anti-Bribery Laws, as well as the APEC General Elements of Effective Voluntary Corporate Compliance Programs adopted by APEC Leaders in 2014. For example, in August the United States and Peru hosted an all-day APEC Workshop on anti-bribery corporate compliance programs and incentives, organized by the Peruvian High-Level Anticorruption Commission and the Department of Commerce. The U.S. government is also actively engaged in the Business Ethics for APEC Small and Medium Enterprise Initiative, the world’s largest collective action mechanism to strengthen ethical business practices in the medical device, biopharmaceutical, and construction and engineering sectors.” – Implementing Department or Agency: State, Commerce
Outcome 1.2: Utilize U.S. Law, Multilateral Agreements, and Diplomacy to Promote and Enforce High Standards
Ongoing Commitments and Initiatives [page 9-10]
“Free Trade Agreements: … All U.S. FTAs since 2004 also contain transparency and anti-corruption provisions, including requiring our trading partners to criminalize both domestic and foreign bribery. For instance, the TPP includes a historic transparency and anti-corruption chapter. The TPP Parties have also agreed to encourage companies to voluntarily adopt corporate social responsibility principles that the TPP parties have themselves supported or endorsed relating to labor and environment issues.” – Implementing Department or Agency: USTR, State, Commerce, DOL
“Anti-Bribery and the OECD: The United States plays a leadership role in the Anti-Bribery Convention’s monitoring mechanism, conducted by the OECD Working Group on Bribery in International Business Transactions, which has been instrumental in increasing the number of countries enacting and enforcing foreign bribery laws. In the coming year, the U.S. government – led by State, the Departments of Justice (DOJ) and Commerce, and the Securities and Exchange Commission (SEC) – will continue to push for robust country reviews of Parties to the Antibribery Convention and examine obstacles to advancing the global efforts to address international bribery and corruption.” – Implementing Department or Agency: State, Commerce, DOJ, SEC
Outcome 1.2: Utilize U.S. Law, Multilateral Agreements, and Diplomacy to Promote and Enforce High Standards
Ongoing Commitments and Initiatives [page 10]
“International Anti-corruption and Good Governance Act (IAGGA): The U.S. government will continue its commitment to implement the IAGGA.” – Implementing Department or Agency: State, USAID, Commerce
“Federal Funding Accountability and Transparency Act of 2006 (as amended): Under this law’s implementing regulations, federal awardees currently report a variety of data on their first tier sub-awardees. The Department of the Treasury (Treasury) will continue to make this data available to the public on http://www.usaspending.gov/http://www.usaspending.gov/.” – Implementing Department or Agency: Trade
Collaborating With Stakeholders [page 13]
“Through the Extractive Industries Transparency Initiative (EITI), the United States is committed to promoting transparency in the extractives sector by playing an active role on the International EITI Board and Board committees. The U.S. commitment to EITI — both to promote it abroad and to implement it at home — sends a strong signal to our international partners that transparency is critical for countries at all levels of development, and in all regions.”
Outcome 2.1: Enhance the Value of Multi-Stakeholder Initiatives on RBC
New Action [page 14]
“Promoting Rights and Accountability through RBC: In May 2016, USAID launched a new Broad Agency Announcement calling for organizations and companies to collaborate in the development, piloting, testing, and scaling of innovative, practical, and cost-effective interventions to address human rights and anti-corruption in business activities globally. USAID seeks through this announcement to create more strategic, focused, and results-oriented approaches to generate solutions to rights abuses and corrupt practices in global commerce, and form partnerships to target risks and prevent violations. Under this umbrella announcement, USAID will continue its Supply Unchained initiative to better identify — and counter — human trafficking and other labor exploitation at its source.” – Implementing Department or Agency: USAID
Outcome 3.1: U.S. Government Reports
New Actions [page 17-18]
Country-Level Land Governance Profiles: USAID will develop and/or update 15 public country-level land governance profiles, which explain the land laws, land use patterns, gender concerns, land administration, and land markets within a given country. These profiles are an invaluable introduction for businesses that are looking to make land-based investments in a given country, and are conscientious about investing in an ethical and responsible manner. These profiles are also a critical resource for Embassy staff and others who counsel foreign businesses on potential investments.” – Implementing Department or Agency: USAID
Ongoing Commitments and Initiatives [page 18]
“Investment Climate Statements: State has and will continue to increase the focus on RBC in its annual country reports on investment climates. These reports, which have long covered all aspects of global investment climates, now include descriptions of labor rights and corporate responsibility practices.” – Implementing Department or Agency: State
“Country Commercial Guides: Commerce will continue to include an anti-corruption section in U.S. and Foreign Commercial Service Country Commercial Guides.” – Implementing Department or Agency: State, DOJ, SEC, Commerce
“Anti-Corruption Publications: U.S. government agencies will continue to provide information to companies through a number of U.S. and international publications designed to assist firms in complying with anti-corruption laws, including The FCPA Resource Guide.” – Implementing Department or Agency: State
“Responsible Investment in Burma: In 2012, the U.S. government issued the Reporting Requirements for Responsible Investment in Burma, which required U.S. persons undertaking new investment in Burma to report on certain policies related to responsible and transparent business practices. On October 7, 2016, the President signed Executive Order 13742, which terminated the sanctions program with regard to Burma and made compliance with the reporting requirements voluntary. State will continue to host the voluntary reports on the Doing Business in Burma website and use the information collected as a basis for informed consultations with U.S. businesses to encourage and assist them to develop responsible business practices in Burma. State is also working closely with the Government of Burma as it develops and implements standards for responsible business practices.” – Implementing Department or Agency: State, Treasury
Outcome 3.2: Build U.S. Government Officials’ Capacity to Support RBC
New Actions [page 19]
“RBC Training for U.S. Embassies: … U.S. embassies are already engaged in promoting and recognizing RBC via their participation in the Secretary of State’s Award for Corporate Excellence (ACE) process.” – Implementing Department or Agency: State
Ongoing Commitments and Initiatives [page 19]
“FCPA Training: State and Commerce will continue to provide FCPA and related anticorruption training to Commerce’s U.S. and Foreign Commercial Service officers and State Foreign Service officers so that they may raise awareness about corruption and compliance programs and assist U.S. companies as appropriate when confronted with corruption overseas.” – Implementing Department or Agency: State, Commerce, DOJ, SEC
Outcome 3.3: Capacity Building and Technical Support to Promote Enabling Environments
Ongoing Commitments and Initiatives [page 20]
“Engagement with Companies on Anti-Corruption Issues: DOJ, SEC, Commerce, State and other U.S. government agencies conduct outreach to the business community and will continue to coordinate with the private sector on anti-corruption issues. To this end, DOJ will continue to provide businesses, through its FCPA opinion release procedures, the opportunity to seek an opinion as to whether certain prospective, non-hypothetical conduct conforms with DOJ’s enforcement policy. Commerce and State, including through Foreign Commercial Service officers and State Foreign Service officers, will continue to raise awareness about corruption and the importance of effective compliance programs, and assist U.S. companies as appropriate when confronted with corruption overseas. High-level Commerce officials also meet with business leaders around the world and advocate with government officials on rule of law and anti-corruption issues, and the Commercial Law Development Program (CLDP) meets regularly with U.S. businesses to better understand their concerns about, and provide programming in priority countries on, the legal and regulatory reforms needed to reduce corruption and level the playing field in developing countries for U.S. companies.” – Implementing Department or Agency: DOJ, SEC, State, Commerce
Outcome 4.1: Recognize RBC Best Practices
New Actions [page 22]
“Promoting Human Rights in the ICT Sector: … State, working with other agencies and stakeholders, will develop a regular mechanism to identify, document, and publicize lessons learned and best practices related to corporate actions that promote and protect human rights online. …” – Implementing Department or Agency: State
“Modernize the Secretary of State’s Award for Corporate Excellence (ACE): For 17 years the ACE has recognized the best of U.S. business conduct abroad. Until recently, the ACE focused principally on corporate philanthropy rather than a company’s efforts to ensure that its core business is conducted responsibly. In 2015, the ACE was given out in distinct categories for the first time, designed to align with RBC international best practices. Partly as a result of these updates, the ACE ceremony received unprecedented global participation, with a 470 percent increase in Twitter activity, articles in Voice of America and the Huffington Post, and a 100 percent increase in ceremony viewership online. For 2016, the ACE will continue its focus on highlighting RBC best practices, and will be awarded for transparent operations, inclusive hiring, sustainable oceans management, and small or medium enterprises.” – Implementing Department or Agency: State
Annex II: Key Domestic Executive Orders and Regulatory Efforts [page 26-29]
“… The U.S. Foreign Corrupt Practices Act of 1977 (FCPA): In general, the FCPA prohibits certain classes of entities and individuals, including U.S. companies and citizens and companies publicly traded on a U.S. securities exchange, from offering to pay, paying, promising to pay, or authorizing payments to foreign officials to influence their acts or decisions or to secure other improper advantages.
”No Safe Haven” Initiative: The “No Safe Haven” initiative aims to deny entry into the United States and U.S. citizenship to the corrupt, to bribe payers, to those who benefit from corruption, those who commit certain human rights violations, and to human rights abusers and war criminals. The initiative is complemented by Presidential Proclamation 7750, which suspends the entry, in part, of public officials who accept bribes and the individuals who provide them, along with immediate family members of public officials who benefit from the corruption.
Kleptocracy Asset Recovery Initiative: DOJ uses legal tools to trace and recover the proceeds of foreign corruption in the United States. A team of prosecutors works with federal law enforcement agencies to track the proceeds of foreign corruption, prosecute those who launder the proceeds of corruption, and put forfeited assets to use for the benefit of the people of the country victimized by such abuses of public trust. The Initiative ensures that corrupt foreign leaders cannot seek to launder or spend their stolen wealth in the United States. DOJ also participates in various international fora on asset recovery and, along with the Departments of Treasury and State, pushes to strengthen the global implementation of the international anti-money laundering and counter-terrorist financing standards through the FATF. In addition to the Kleptocracy Initiative established in 2010, DOJ has five other anti-corruption programs. DOJ focuses on investigating and prosecuting domestic public integrity offenders, bribe payers, taxpayers who seek to conceal foreign accounts, and money launderers who facilitate the movement, use, and concealment of corrupt funds, and DOJ continues to provide legal assistance to its foreign partners to fight corruption and ensure it is not a profitable enterprise.
Money Laundering and Bank Integrity: Treasury administers the Bank Secrecy Act (BSA), which, among other things, requires financial institutions to maintain effective anti-money laundering (AML) compliance programs. Effective AML programs include, among other things, the ability to detect and report suspicious activity, including corruption, and to conduct due diligence and enhanced measures when banks, broker-dealers, or other institutions deal with senior foreign political figures. DOJ prosecutes criminal violations of the BSA focusing on criminal violations by financial institutions whose actions threaten the integrity of the individual institution or the wider financial system, as well as professional money launderers and gatekeepers. These unique cases reinforce the obligation on U.S. businesses in the financial sector to harden their infrastructure against financial crime—including bribery, misappropriation, and theft—and reinforce the private sector’s role as a strong line of defense against the introduction of ill-gotten gains to the U.S. financial system. …
“Transparency: The U.S. government is engaging in efforts to strengthen financial and corporate transparency to make our country even less attractive for the corrupt looking to spend the proceeds of their crimes. To that end, DOJ has submitted to Congress a package of legislative proposals that will improve the United States’ ability to combat money laundering, particularly when linked to foreign official corruption, and to locate and recover stolen assets and other criminal proceeds. Additionally, Treasury recently announced a final rule to increase transparency in the financial system. The final Customer Due Diligence rule, which was first noticed in 2014 and was subject to a public comment process, will require that financial institutions—including banks and other entities—collect and verify the personal information of the real people (also known as beneficial owners) who own, control, and profit from companies when those companies open accounts. It clarifies and expands BSA obligations and will be fully implemented by financial institutions no later than two years after its effective date (i.e. May 11, 2018). Finally, Treasury, on behalf of the Administration, sent to Congress draft legislation that would require companies formed within the United States to file adequate, accurate, and current information on its beneficial owners with Treasury. The proposed legislation includes penalties for failure to comply and is necessary to prevent the misuse of companies formed under state law. To address potential vulnerabilities in the domestic real estate market, Treasury uses its authorities to require certain title insurance companies to identify the natural persons behind shell companies used to pay “all cash” for high-end real estate in six major metropolitan areas.”