Guiding Principle 3
In meeting their duty to protect, States should:
(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.
States should not assume that businesses invariably prefer, or benefit from, State inaction, and they should consider a smart mix of measures – national and international, mandatory and voluntary – to foster business respect for human rights.
The failure to enforce existing laws that directly or indirectly regulate business respect for human rights is often a significant legal gap in State practice. Such laws 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.
It is equally important for States to review whether these laws provide the necessary coverage in light of evolving circumstances and whether, together with relevant policies, they provide an environment conducive to business respect for human rights. For example, greater clarity in some areas of law and policy, such as those governing access to land, including entitlements in relation to ownership or use of land, is often necessary to protect both rights-holders and business enterprises.
Laws and policies that govern the creation and ongoing operation of business enterprises, such as corporate and securities laws, directly shape business behaviour. Yet their implications for human rights remain poorly understood. For example, there is a lack of clarity in corporate and securities law regarding what companies and their officers are permitted, let alone required, to do regarding human rights. Laws 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.
Guidance to business enterprises on respecting human rights should indicate expected outcomes and help share best practices. It should advise on appropriate methods, including human rights due diligence, and how to consider effectively issues of gender, vulnerability and/or marginalization, recognizing the specific challenges that may be faced by indigenous peoples, women, national or ethnic minorities, religious and linguistic minorities, children, persons with disabilities, and migrant workers and their families.
National human rights institutions that comply with the Paris Principles have an important role to play in helping States identify whether relevant laws are aligned with their human rights obligations and are being effectively enforced, and in providing guidance on human rights also to business enterprises and other non-State actors.
Communication by business enterprises on how they address their human rights impacts can range from informal engagement with affected stakeholders to formal public reporting. State encouragement of, or where appropriate requirements for, such communication are important in fostering respect for human rights by business enterprises. Incentives to communicate adequate information could include provisions to give weight to such self-reporting in the event of any judicial or administrative proceeding. A requirement to communicate can be particularly appropriate where the nature of business operations or operating contexts pose a significant risk to human rights. Policies or laws in this area can usefully clarify what and how businesses should communicate, helping to ensure both the accessibility and accuracy of communications.
Any stipulation of what would constitute adequate communication should take into account risks that it may pose to the safety and security of individuals and facilities; legitimate requirements of commercial confidentiality; and variations in companies’ size and structures.
Financial reporting requirements should clarify that human rights impacts in some instances may be “material” or “significant” to the economic performance of the business enterprise.
What National Action Plans say on Guiding Principle 3
Action point 1.5 (p. 11): “Each entity part of the Working Group, according to their operational plan, will define their training plan on this matter and will encourage the learning management in order to guarantee the continuation of the execution of the actions of this Plan. The inter-institutional training processes will be promoted for a better understanding of this matter in its various aspects; thus, the national entities will manage, together with their peers in other countries with the Colombia based embassies, the relevant tools as may be required.”
Action point 1.6 (p. 11): “The Ministry of Foreign Affairs will disseminate and promote this plan internationally through its Diplomatic Missions, Permanent Representation Offices and Consular Sections.”
Action point 1.7 (p. 11): “The Ministry of Commerce, Industry and Tourism, through its offices and agencies charged with business internationalization, will promote respect for human rights in the business activities, providing support regarding the contents of this Plan.”
Action point 1.9 (p. 12): “The Post-Conflict Directorate, jointly with the Council to the President for Human Rights, will promote the agenda on human rights and peacebuilding in the business sector, in alliance with the Chamber of Commerce of Colombia; thus, a training and knowledge transfer process by the Government, as well as cooperation with enterprises and the enterprises’ employees will be created.”
Action point 2.3 (p. 13): “The Ministry of Commerce, Industry and Tourism will emphasize the inclusion, in the business negotiations with other States, of clauses or criteria on human rights; this will be considered in the negotiation of future agreements, review of current agreements, and/or unilateral or joint statements with the business partners.”
Action point 2.4 (p. 13): “The Ministry of Commerce, Industry and Tourism and its entities will determine the requirements regarding sustainability and respect for human rights as the criteria to select the enterprises to participate in their business activity encouragement programs, including the SME and micro SME (to this end, they will follow the OECD Recommendations for export credit entities http://www.oecd.org/tad/xcred/oecd-recommendations.htm)”.
Action point 2.5 (p. 13): “The Ministry of Commerce, Industry and Tourism and its entities (PROCOLOMBIA) will work to make the Colombian enterprises observe the human rights standards and will strive for incentives in the international market.”
Action point 5.6 (p. 17): “The Ministry of Commerce, Industry and Tourism will promote the business efforts to adjust their policies to the OECD Guidelines for Multinational Enterprises, for which purposes it will assess, within six month from the execution of this Plan, its strategy to disseminate the Guidelines so as to make them widely known.”
Pillar I. The State Duty to Protect Human Rights
Strand 1: Training in the Field of Business and Human Rights [pages 29-33]
The need to provide training in business and human rights was stated repeatedly during the different stages of the process. Both during the study of the baseline and at the seminars, dialogues and other opportunities to get involved in the process, the importance of raising understanding around business and human rights was stressed. Therefore, the following measures were committed:
1.1 The Ministry of Foreign Affairs will:
o Create alliances with different institutions to train interested actors. Material developed in this process will serve as a basis for other training actions included in this Plan.
o Work to build capabilities in the staff working at the Ministry of Foreign Affairs, through the development of an e-learning course on business and human rights.
o Strengthen the diplomats’ capabilities in the field of business and human rights, with the purpose that they have the right tools to support Chilean businesses abroad – through the development of an annual Module on Business and Human Rights taught at the Diplomatic Academy. It will promote, among the Chilean embassies posted abroad, tools allowing to guide Chilean businesses operating in those countries about risks in the fields of business and human rights.
o Develop projects of cooperation and exchange of experiences about business and human rights with Chilean embassies posted in countries showing more progress in this field, through its Programme of Activities Abroad (PAAE).31
o The General Directorate of International Economic Relations (DIRECON), will carry out internal actions to promote knowledge around business and human rights with the purpose that staff working in this Directorate take these criteria into account when developing their activities.
DIRECON will periodically report to the Trade Offices and Regional Offices of the Exports Promotion Directorate (ProChile) about business and human rights. o DIRECON will raise awareness and further knowledge concerning other relevant international instruments and their link with the United National Guiding Principles on Business and Human Rights, such as the Tripartite Statement of Principles on Multinational Business Enterprises and ILO’s Social Policy, and ISO 26,000. The above will be carried out through presentations, seminars, dialogues, briefings and publications in the website, as relevant.
1.2 The Under-Secretariat of Human Rights of the Ministry of Justice and Human Rights will:
o In the context of its mandate to design, foster and coordinate education and training actions concerning human rights for staff working for State bodies, promote the introduction of contents covering business enterprises and human rights in trainings and courses that come to its attention in its articulating role.
o Promote the introduction of contents covering business enterprises and human rights in training sessions for people joining State work through the Senior Public Management System led by the Civil Service.
o Promote the introduction of contents about business enterprises and human rights in training sessions held by the Armed Forces and the Order and Security Forces, when relevant, according to the trainees’ profiles.
o Introduce subjects concerning business enterprises and human rights in a future Handbook about the focus on human rights of public policies.
1.3 The Ministry of Labour will:
o Train workers about their rights and the Guiding Principles through the introduction of subjects related with business enterprises and human rights in the programmes of study of the Union School, with emphasis, inter alia, on labour rights and child labour.
o Train businesses (guilds, confederations, associations and SMEs), unions and civil servants in the field of business and human rights, emphasising labour rights. o Inform users about this Action Plan through a banner uploaded in the ministry’s website portal -aimed at providing additional information in this area, and showing the measures that the ministry is carrying out in the relevant field.
1.4 The Ministry of Energy will: o Through the Division of Social Involvement and Dialogue, within the implementation framework of the Indigenous Chapter of the 2050 Energy Policy will perform the following actions:
- Develop training sessions in renewable energy for indigenous leaders with focus on business and human rights.
- Perform activities to transfer experiences and knowledge to companies, so that they have information available for the development of energy projects in indigenous contexts.
- Develop actions to train business enterprises about human rights and corporate activity, focusing on indigenous rights and cosmovision.
- Train indigenous peoples about business and human rights. This initiative will be performed in conjunction with the Indigenous Affairs Unit of the Ministry of Social Development, which will facilitate coordination between initiatives carried out by both institutions within the context of the Action Plan.
1.5 The Ministry of Social Development will:
o Through the Indigenous Affairs Coordination Unit, carry out a Training Plan including indigenous peoples related subjects for businesses operating in the North and South macro-zones, including the focus introduced by United Nations Guiding Principles on
Business and Human Rights. Contents of these training sessions will include relevant international standards, which will be discussed with indigenous representatives and have the involvement of business enterprises. Through the Indigenous Affairs Coordination Unit, it will publish a Participatory Guide concerning Indigenous Rights and Cosmovision of Indigenous Peoples, allowing to advise and train business enterprises about these peoples and the respect for their rights.
o Train staff on the Guiding Principles, including professionals from the Division of Social Policies and the Division of Social Assessment and Investment.
o Through the Division of Public-Private Cooperation, include the focus on business, human rights and sustainable development in training activities about Public Incentives to Benefit Social Development by means of:
- Workshop-seminars about Public Incentives to Benefit Social Development for Business Enterprises and public-private cooperation in accordance with the Guiding Principles and the 2030 Agenda, thus strengthening the State-Business nexus and promoting due diligence in human rights.
- Introduction of a module about the “Guiding Principles on Business and Human Rights and their connection with the 2030 Agenda for Sustainable Development” in a workshop-seminar organised by business senior and executive staff. o Through the National Disability Service, will:
- Train public and private business enterprises to include inclusive for disabled people in inductions and training programmes.
- Organise seminars to public services and bodies, business enterprises and the civil society to address subject concerning disability. Also, a course about Human Rights and Disability will be given at universities, and outreach actions will be carried out involving public services and bodies, business enterprises and the civil society
1.6 The Ministry for the Environment will:
o With the support of expert organisations, coordinate internal training at a national and international level, and at a macro-zone level in the Ministry of the Environment, the Superintendence of the Environment (SMA) and the Environmental Assessment Service (EAS).
o In coordination with the Environmental Assessment Service, expand the training carried out in technical-environmental matters to representatives of the civil society and indigenous peoples to facilitate their involvement and the exercise of their rights during the process of citizens’ involvement.
o Upon creation of the Biodiversity and Protected Areas Service and of the Protected Areas National Service, carry out an outreach and training process including an analysis about their relationship with business and human rights.
1.7 The National Human Rights Institute will: o Train staff working in regions about business, human rights and sustainable development, in line with the 2030 Agenda.
o Update the booklet of emerging issues and the business and human rights card. o Introduce the Guiding Principles on Business and Human Rights in the recommendations they submit to the State about cases documented by this institution. These recommendations, and those coming from the international human rights system will be considered in training sessions given to public officers about companies and human rights.
1.8 The Ministry of Mining will organise talks and/or seminars about the introduction of human rights standards in the development of mining projects.
Strand 3: Inclusion and Non-Discrimination [pages 35-39]
The Country Guide on Business and Human Rights identifies groups at risk of suffering different infringements of their rights about corporate operations such as women, indigenous peoples, migrants, LGBTI individuals and people suffering from disabilities. Potential negative impacts on these groups may take place both inside the business enterprise (hiring, firing or discrimination) and outside the business for situations derived from corporate activity.
3.1 The Ministry of Labour will:
o Perform a series of actions aimed at the protection and defence of human and labour rights of migrants through:
- The identification of migrants that may benefit from State programmes on labour matters.
- Training and awareness actions regarding the rights of migrants in the labour market for civil servants, unions and migrant associations.
o Seek to increase the incorporation and participation of women in the labour market through programmes benefiting this group such as: Bonus to Reward the Work of Women; Programme to Develop Labour Competences for Women, Chile Solidario. o Promote and ensure the participation of women workers in unions.
o Foster parental responsibility through the development of Special Covenants where unions may agree with the employer upon certain covenants aimed at offering workers with parental responsibilities the chance to access to labour schemes combining time at the workplace with time out of the workplace, as set out by article 376 of Law No. 20,940.
3.2 The Ministry of Social Development will:
o Create a board, integrated by representatives of the public and private sector, civil society organizations and academia, to address the work and family conciliation and its impact in children and their carers. The aim is to raise awareness on the impacts of the work and family conciliation in the development of children and adolescents and disseminate best practices on this issue, on the private and public sector.
o Constitute a local board of employability, as a space of local and community network. The board is integrated by the Ministry of Social Development, the Chilean Chamber of Construction, the Labor Union and representatives of the local Government and employers of the area that it will executed.
o Organise, through the Indigenous Affairs Coordination Unit, a Coordination Board including the participation of indigenous peoples and relevant organisations with the purpose of proposing non-discrimination and inclusion measures in the labour market. This Board will take into consideration the international standards set out in Covenant 169, as well as the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) and the recommendations gathered from the citizens’ dialogues held within the framework of the National Action Plan about the subject
o Prepare, through the Division of Social Policy of the Under-Secretariat of Social Evaluation, a statistical report about the socio-economic situation of risk groups including migrants, youngsters, disabled people, women and indigenous peoples, based on the Socio-Economic Qualification (SEQ) including income generated by work, capital and pensions, contained in the Household Social Register, divided by territory (regional division). This has the purpose of having available information regarding vulnerable groups within certain territory.
o Promote, through the National Disability Service, the labour insertion of people with disabilities by taking the following specific steps:
- The Programme +Capaz en Línea Especializada para Personas con Discapacidad, will be executed and adapted in conjunction with the National Training and Employment Service (Sence).
- An initiative to strengthen the work of Municipal Offices for Labour Intermediation (OMIL) will be carried out to attend people with disabilities – through a Local Development Strategy.
- Create an Inter-Sectoral Board aimed at urging mass media, including digital media, to be accessible to people with disabilities (by using sign language, captions, making reading easier, access to information or images for people with sight disabilities.)
3.3 The Ministry of Mining will generate the conditions for transiting to an inclusive organisational structure that includes the acknowledgement of respect and diversity in their practices. They will do this carrying out the following actions:
o Talks about business and human rights addressed at key actors in the small, medium and large-scale mining industry.
o Through the participation in Regional Boards and in the National Board for Women and Mining, the development of an action plan will be supported to raise awareness and motivate the different public and private actors involved in the mining industry in subjects such as gender equality. Likewise, the implementation of conditions for women to stay and develop a career in the mining industry and get equal pay will be fostered, as well as the creation of good labour practices and the balance between work, family and personal life.
3.4 The Ministry of Economy, Development and Tourism, through the Division of Associativity and Social Economy will:
o Create incubators of inclusive cooperatives in conjunction with SENADIS, the Ministry for Women and Gender Equality and local governments, in five districts -through training sessions in four different regions about the programme of female leadership in cooperatives.
o Encourage the organisation of training and support for the effective exercise of gender parity at democratic representation bodies within cooperatives.
3.5 The General Directorate of International Economic Relations of the Ministry of Foreign Affairs will carry out activities concerning best practices for SMEs, with the purpose of making progress in the application of best practices in the areas of inclusion, leadership and family balance.
3.6 The Ministry for Women and Gender Equality will:
o Carry out activities in conjunction with the Danish Embassy to encourage the respect of human rights in women regarding corporate activity. The activities will be performed within the framework of the Memorandum of Understanding about “Gender Equality and Sustainability, including Business and Human Rights.”
o Organise training sessions for union leaders of State business enterprises about the union’s challenges regarding gender-focused demands.
o Organise training sessions for human resource staff working in State business enterprises and other businesses about the balance between work and family life.
o Disseminate Chilean Regulation No. 3262 to civil servants and business enterprises. o Encourage gender equality in business enterprises through the Iguala Seal.
o Train civil servants about the balance between work and family life.
3.7 The Ministry of Energy will promote the respect of human rights of indigenous peoples concerning the development of energy projects. It will do this through the implementation of the indigenous chapter the energy policy in the long-term, developing consultation and participation processes pursuant to ILO Covenant 169, and drafting a guide for indigenous participation in the development of energy projects. Likewise, the Ministry will promote the development of a “gender and energy agenda” seeking to enhance the role of women in the development of a national energy industry, from strengthening their capacity and knowledge in energy subjects to developing startups linked to the industry, and promoting the participation of women in the design and implementation of the Energy Policy
Strand 8: Legislation, Policies and Incentives [pages 48-49]
The independent baseline developed for this process carries out an analysis of the legislation gaps existing in different sectors in business and human rights matters. Although legislation changes require long debate, the Plan is committed to carry out the following relevant measures:
8.1. 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.
8.2. The Ministry of Energy will identify, promote and design the necessary mechanisms to implement the local development policy concerning energy projects. Among other things, the policy includes measures to support the assessment of impacts on the human rights of communities, and mechanisms to resolve the disputes that may arise between communities and business enterprises, within the context of the development of energy projects.
8.3. The Ministry of Labour and the Ministry of Social Development will continue promoting labour inclusion through the creation of the regulation supporting the Labour Inclusion Law, thus fostering inclusion from a human rights perspective.
Pillar II. The Corporate Responsibility to Respect Human Rights
Strand 1: Contextual issues: Development of texts allowing business enterprises to understand the local context and the risks of potential negative impacts on human rights [pages 52-57]
It is of utmost importance that business enterprises find ways to respect internationally recognised human rights, even if they lack continuous specialised advice or when the national context and/or circumstances where they operate may hinder or limit the full performance of their duties. In this sense, the measures contained in this heading focus on facilitating and updating the tools helping business enterprises to access to the necessary information about the applicable legislation and context so that they can:
– Comply with all applicable laws and respect internationally recognised human rights, wherever they operate.
– Look for ways helping them to respect human rights when they need to comply with conflicting demands.
– Take into consideration the risks involved in causing or helping to cause serious human rights violations, as a matter of law enforcement, wherever they operate.
1.1. The Ministry of Foreign Affairs will streamline they webpage on business and human rights to include tools, guides, guidelines and news, as well as the progress made by the National Action Plan. For this, it will seek the support of international institutions.
1.2. The National Institute of Human Rights will: o Disseminate and update the Country Guide on Business and Human Rights with support from business enterprises, the civil society, unions and academia.
1.3. The National Health Institute will coordinate, with expert support, the preparation of a study about the impact of the pharmaceutical industry.
1.4. The Ministry of the Environment will prepare a study about the links between the Law creating the Actual Right of Conservation (DRC) and the Guiding Principles.
1.5. The Ministry of Energy will keep updated the standard guide for participating in the development of energy projects, and will prepare a guide for indigenous participation in the development of energy projects. It will also prepare the guide for local development of the localities where such projects are settled, which will drive the actions of business enterprises and communities about the contribution to development that can be offered by these institutions. 1.6. The Environmental Assessment Service will prepare the Guide for Describing the Human Environment with Gender Focus for the Assessment of Environmental Impact. Such Guide is meant for the owners of projects submitted to the SEIA.
Strand 2: Promotion of corporate due diligence in the field of human rights
The need for the State to generate an understanding among business enterprises about due diligence in human rights was often mentioned in the citizens’ dialogues, as well as the creation of spaces allowing to clarify how to develop these processes at a local level.
2.1. The Ministry of Foreign Affairs, through the General Directorate of International Economic Relations, will: o 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. o Disclose to business enterprises who are members of ProChile the United Nations Guiding Principles, thus helping, in this was and as far as possible, to incorporate them in their activities. It will do this through information available in the website, talks or sets of tools to strengthen their capabilities, and/or through the publication of handbooks containing the Guiding Principles or another suitable instrument, with special focus on information and training provided to SMEs.
2.2. The Ministry of Economy, Development and Tourism will:
o Hold a working group 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 thee working groups, sector guides will be developed to evaluate compliance with human rights issues, with special emphasis on the management of supply chains.
o Create working groups in conjunction with the Under-Secretariat of Fisheries and Aquaculture and the Under-Secretariat of Tourism, which will have the duty to analyse and create mechanisms allowing to monitor these sectors regarding their respect for human rights. It will encourage and work with SEP for the adoption of an audit system in the field of human rights.
o Support the Ministry of Energy in the development of a Guide about the impact of projects on local communities, seeing to the integration of business and human rights standards into the development of projects within communities and, particularly, containing best practices about due diligence in human rights-related issues.
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.
Propose guidelines for business enterprises to have remedial mechanisms available. o 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. o Look to generate strategic alliances with banking institutions to facilitate access to financial services to cooperatives -which projects integrate an actual and potential analysis of the contribution and impact that the business may have on human rights. o Subscribe in 2017 an agreement with a technical specialised body to develop a system to diagnose and measure the impact of small and medium size enterprises on human rights, through a digital tool of public access.
Strand 3: Report in the field of human rights
The Guiding Principles stress the importance of the State in terms of encouraging business enterprises to communicate the way they address the risks of adverse impacts on human rights -through reports or other means. Sustainability reports may contain information about the way the business enterprise had identified and addressed risks in the field of human rights.
3.1. The Ministry of Economy will: o Encourage the development of a Guide about the duty of public enterprises regarding human rights. o Foster the use of reporting mechanisms about human rights between public business enterprises.
Promote, through the Division of Associativity and Social Economy, strategies and mechanisms of accountability and non-financial reporting for cooperatives, which will include the potential risks of their businesses on human rights. To encourage the use of this practice, an electronic template will be developed in 2017, free of charge and freely available, for these bodies to report to the State and their different target audiences.
II. The State as an economic actor
Including human rights in the State’s business activity [pages 13-22]
To such end:
2.6 The Ministry of Environment, jointly with the National Authority for Environmental Permits, will strengthen the existence of respect for human rights requirements regarding the Environmental Impact Assessment of companies, and the Business Social Risk Management and Human Rights Plans.
2.7 The Ministry of Agriculture and Rural Development will include the human rights criteria and the DESCA in its business activity related programs.
III. Effective participation of civil society
Guaranteeing the defense and promotion of human rights in business activities
3.1 Within the following year of the Plan being launched, the Task Force on Business and Human Rights will find allies for the training of civil society, special protection groups and small enterprises, regarding the United Nations Guiding Principles and the international standards on human rights and business, and this Plan
3.2 The Direction of Post-conflict and the Office of the High Commissioner for Peace will design a protocol for dialogue among the communities, enterprises and state entities, allowing for the participation of social organization, according to the international standards on business and human rights.
3.3 The Minister of the Interior will propose the inclusion of the business and human rights issue on the agenda of the National Committee for Human Rights Defenders, Social and Community Leaders, as well as the Regional Committees for Guarantees, with the purpose of using them as meeting spaces to settle conflicts with impacts on human rights caused by the business activity.
3.4 Through the Comprehensive Conflict Prevention and Management System, the National Government will create agreement and social talk mechanisms between the Government and its several levels, the communities and the enterprises. The foregoing to create formal dialogue areas for actors with various interests; all of that as the way to contribute to peacebuilding and respect for human rights in the territories. This action will begin its execution once the system is implemented.
3.5 The Ministry of the Interior will organise actions intended to guarantee the necessary safety conditions so the leaders working on business and human rights matters might carry out their activities in proper conditions, according to the current guarantee policy for the defense of human rights.
IV. The State’s Guidance towards respect for human rights in business activities
Tools for the business world
Guaranteeing that business enterprises respect human rights is not a matter of law and supervision only. For such purpose, the State must play a strong guiding role towards respect for human rights in the business world. There are multiple spaces, mechanisms and instances where enterprises engage with the State: the State supervises, the States promotes investments, the States regulates the business practices, etc.
It is highly important that all of the contact points between the State and the enterprises encourage the human rights agenda, responding, in turn, to the most appropriate form. Thus, this section is intended to direct the State action including, but not limited to, regulation matters, conditional business promotion or, sometimes, as information for those who are willing to conduct business in the country4. In every implemented measure, the State must promote the appropriation and leadership of respect for human rights by the related enterprises.
4.1 The Government will strengthen the subscribing to these multi-actor initiatives: Guias Colombia, Swiss Ethical Committee and the Mining-Energy Committee, as well as the implementation of guides or the provided recommendations by such initiatives.
4.2 The Council to the President for Human Rights will have a microsite on its website for the business and human rights issue, where the information on the implementation of this plan will be available.
4.3 With the purpose of preventing enterprises from engaging in actions involving any kind of discrimination, the National Government will boost the knowledge transfer and the transfer of the developed tools in the context of the National Human Rights Strategy in respect of rights to equality and non-discrimination.
4.4 Within the State Policy for the LGBTI population, which the National Government is preparing, business practices respecting, recognizing and appreciating this population’s diversity will be supported.
4.5 The Ministry of Labor will advise the businessmen on the labor inclusion of people with disabilities and employment mediation services, in agreement with the National Public Policy on Disability and Social Inclusion.
4.6 The Council to the President for Women Equality will strengthen the coordination for the application of the international standards on women’s rights, intended to guarantee such rights in the business world.
4.7 The Ministry of Labor and the Colombian Institution for Family Welfare will strengthen actions intended to provide advice, training and monitoring to enterprises in respect of the integral protection of the children’s rights, as well as the implementation of the children’s rights and business principles in the priority sectors.
4.8 The Ministry of Labor will strengthen actions to prevent the commercial sexual exploitation of children and adolescents, and will create strategies engaging the private sector in the actions to prevent the violation of the children’s and adolescents’ rights.
4.9 The Ministry of Labor will strengthen actions aiming at protecting the rights to union freedom and collection negotiations.
4.10 The Ministry of Labor will propose the inclusion of the business and human rights matter in the National Agreement Commission and in the Social Talk Plans of the Department Agreement Subcommittees.
4.11 The Ministry of the Interior will implement actions at the institutional level to identify the real issues in the prior-consultation process and its effect on human rights. It will also improve such practices allowing for the involvement of the affected population, protecting and respecting the rights of the native, afro-descendant and ethnic minority communities, according to the OIL agreements and the standards of the Inter-American Human Rights System.
4.12 In the year following the Plan launching, the Ministry of Mines and Energy will design a strategy to step forward as for the respect for human rights in the mining-energy sector, which will adjust the Principles and Criteria of the Extractive Industries Transparency Initiative (EITI) to the national needs.
V. Human Rights Due Diligence
Defining the concept and guiding through effective implementation mechanisms
Due diligence is understood as the set of measures systematically implemented by an enterprise acting cautiously, to fulfill its respect for human rights duty, considering the specific circumstances according to the activity, operation context, scope and similar factors. Since this is a concept to be interpreted in each case as an appropriate response to the risks of impacts on human rights by the business activities, the State must determine how companies are expected to act so they can execute human rights due diligence. Thus, it will encourage the development of mechanisms and tools allowing for the practical implementation by business and public entities of the human rights due diligence. The entities must act as follows:
5.1 The Task Force will coordinate the preparation of a guide intended to define what executing due diligence means; what the practice is, particularly applied to the high risk business activity sectors.
5.2 The State entities with the highest procurement volume will determine and implement due diligence mechanisms in their own procurement processes.
5.3 Promote the implementation of the United Nations Guiding Principles and other international standards on business and human rights by the trades and the enterprises part thereof, so they may adopt human rights policies. Thus, during the first year of the execution of this Plan, the Council to the President for Human Rights will convene high level meetings with the trades to determine the inclusion goals in the multi-actor initiatives and human rights performance follow-up mechanisms. These actions must be coordinated with the entities of the Task Force, especially with the Ministry of Commerce, Industry and Tourism and in cooperation with the Direction of Post-conflict.
5.4 The Council to the President for Human Rights and the Ministry of National Defense will encourage the implementation of the Voluntary Principles on Security and Human Rights. To that end, they will alternately engage in the areas where such issue is treated.
5.5 Develop a guide on the increasing human rights risks of the business activities in zones historically affected by the armed conflict. Thus, the Council to the President for Human Rights and the Direction of Post-conflict will coordinate with the Comprehensive Conflict Prevention and Management System the development of such guide, which must be worked upon in a participatory manner with the enterprises and the civil society.
According to the provided period to create the Comprehensive Conflict Prevention and Management System, this action must be carried out within the year following the coming into operation of such system.
5.6 The Ministry of Commerce, Industry and Tourism will promote the business efforts to adjust their policies to the OECD Guidelines for Multinational Enterprises, for which purposes it will assess, within six month from the execution of this Plan, its strategy to disseminate the Guidelines so as to make them widely known.
5.7 The Task Force will assess and analyze the formulae for enterprises to include the reporting of the human rights due diligence in their Sustainability Reports or rendering of accounts. Such assessment will be carried out within the year following the launching of this Plan and accompanied by the several sectors.
The enterprises duty to respect human rights
The responsibility to respect human rights is a “global standard of expected conduct for all business enterprises wherever they operate. It exists independently of States’ abilities and/or willingness to fulfill their own human rights obligations, and does not diminish those obligations. And it exists over and above compliance with national laws and regulations protecting human rights. Addressing adverse human rights impacts requires taking adequate measures for their prevention, mitigation and, where appropriate”.
Upon this Plan, the National Government will focus its efforts on consolidating the progress of the business commitment to the respect for human rights in the following lines:
- Generate a culture of human rights and peacebuilding in the business sector.
- Foster and guide the implementation of due diligence mechanisms.
- Generate incentives for large, medium, small and micro enterprises, for human rights to become a competitive advantage.
- Coordinate the Corporate Social Responsibility (CSR) actions for major impact when proposing an agenda where human rights are the common concept framework for the alliance between the State and the private sector.
VI. Culture of Human Rights and peacebuilidng in the business sector
Two political agendas working together
6.1 The Council to the President for Human Rights, within the following year of this Plan being launched, will encourage business to define and publicly disclose their political commitment to respect human rights.
6.2 The Administrative Department for Social Welfare will strengthen the alliances between the private sector and the Administrative Social Inclusion and Reconciliation sector with a view to eradicate extreme poverty and overcome vulnerability conditions.
6.3 The Unit for Care and Integral Repair for Victims, as the coordinator of the National Care and Integral Repair for Victims (SNARIV), jointly with the Direction of Post-conflict, will develop strategies aiming at getting companies to contribute to the recovery of historical memory for peacebuilding, reconciliation and promotion of human rights and the reconstruction of the fabric of society, wherefore memory and peacebuilding culture initiatives might be created.
6.4 The Council to the President for Human Rights, the Colombian Agency for Reintegration and the Direction of post-conflict will prepare a joint strategy for companies to actively promote major participation of people in the reintegration process into the business field, in the production field, and in the peacebuilding processes.
6.5 The Task Force will encourage enterprises to exchange their experiences in order to better understand the human rights and peacebuilding management.
6.6 The Direction of Post-conflict will hold a public debate on the role and power of business enterprises in peacebuilding.
VII. Corporate Human Rights Due Diligence
7.1 The Task Force, advised by the Expert Committee, will encourage talk fora to determine the best formulae for enterprises to establish easy-to-access, transparent and effective complaint and claims offices or mechanisms for prevention and mitigation and remedy of adverse human rights effects as may be caused by their activities.
7.2 The Ministry of Commerce, Industry and Tourism will encourage large enterprises to foster and boost their human rights support and guidance efforts for such SME they have business relationships with.
7.3 The Ministry of Labor will guarantee respect for the labor rights.
7.4 The Ministry of Commerce, Industry and Tourism will encourage business enterprises to foster talks with consumers.
7.5 The Office of the Transparency Secretary of the Presidency of Republic will support the adoption of transparency covenants by enterprises so as to contribute to the corruption struggles in corporate governments, for which purposes a year will be given upon the Plan launching.
7.6 The Task Force will tend towards enterprises, through their complaint offices, receiving and diligently managing the citizen and community claims, as considered to be affected by the adverse effects caused by their operations.
7.7 The Task Force, advised by the Expert Commission, will encourage companies to have follow-up Strategies in place to know about the progress and follow-up to the mitigation of adverse impacts caused by the development of business activities.
7.8T he Task Force, advised by the Expert Commission, will encourage business enterprises to assess their risks and impacts on people and the environment as a result of their operation.
VIII. Respect for human rights as a competitive advantage
The State’s incentives for diligent business enterprises
This section aims at structuring the assistance provided by the State to the business enterprises to such end, through the proposal of specific incentives providing the business enterprises with more facility to operate.
8.1 The Ministry of Commerce, Industry and Tourism will design a differentiated incentive strategy for large, medium and small enterprises with the purpose of having them to implement human rights policies involving: Public commitment, Due diligence procedure, Result, and verification mechanism
8.2 The Ministry of Commerce, Industry and Tourism, supported by the Council to the President for Human Rights, the Direction of Post-conflict and the National Authority for Environmental Permits, will incentivize the establishment of public-private alliances for the creation of social and environmental quality enterprises, particularly in the unfocused rural field.
8.3 The Ministry of Commerce, Industry and Tourism, jointly with the Council to the President for Human Rights will create a Human Rights business incentive to be provided every year and to value the advances the business enterprises might have in adopting the international standards on business and human rights in their operations. This incentive regulation will be developed by the Task Force within the year following this Plan launching.
8.4 The Council to the President for Human Rights will publicly disclose on its website the advances and good practices implemented by the enterprises in respect of the human rights implementation in the business field.
8.5 The Council to the President for Human Rights will coordinate an annual international event with the international community, where business enterprises with the largest progress might show and share their challenges and issues.
8.6 The Council to the President for Human Rights, jointly with the Ministry of Foreign Affairs and the Ministry of Commerce, Industry and Tourism, will facilitate international exchange among business enterprises for better practices in the implementation of human rights in the business activity.
8.7 The Direction of Post-conflict, in cooperation with the Council to the President for Human Rights will identify and recognize the joint work opportunities between the business and the public sectors for development and peacebuilding.
8.8 The Council to the President for Human Rights will generate cooperation strategies between the State and the enterprises for the implementation of affirmative actions.
8.9 SENA will boost and disseminate the business enterprises’ support to the processes developed by the State for the workers’ training.
IX. Corporate Social Responsibility and Respect for Human Rights
Coordination framework between the State and the business sector
9.1 The Ministry of Commerce, Industry and Tourism, jointly with the Council to the President for Human Rights will support the coordination of corporate human rights policies with the Corporate Social Responsibility institutional programs.
9.2 The Corporate Social Responsibility programs are to foster productivity in the areas of influence of their projects to generate the development and economic empowerment of communities under the due diligence and respect for human rights principle.
9.3 Increase the recognition of Corporate Social Responsibility and dissemination of good practices by establishing sector platforms for the enterprises and stakeholders to make commitments and jointly supervise progress. The Ministry of Commerce, Industry and Tourism will supervise this process.
9.4 With the purposes of improving trust levels within enterprises, and follow up to such levels, the Ministry of Commerce, Industry and Tourism will lead and organize the performance of surveys on public trust in business. Such surveys will include questions to find out about the people’s perception of how business enterprises respect human rights and of the remediation mechanisms provided by them.
9.5 The Council to the President for Human Rights will assist the Ministry of National Education to lead the integration of the Guiding Principles on Business and Human Rights and Corporate Social Responsibility into education, training and research. A plan will be thus created, which will be supported by Task Force.
Existing plans, initiatives and strategies [page 8]
Human rights in a business context is covered, for example, by the following strategy documents:
- SME Support Concept 2014-2020
- National Action Plan for Corporate Social Responsibility in the Czech Republic
- Strategic Framework for Sustainable Development of the Czech Republic
- Anti-corruption Action Plan
- National Strategy to Combat Human Trafficking in the Czech Republic 2016-2019
- Social Inclusion Strategy 2014-2020
- Government Strategy for Gender Equality in the Czech Republic 2014-2020
- Foreign Policy Concept of the Czech Republic
- Strategy for the International Competitiveness of the Czech Republic 2012-2020
Pillar I. The State Duty to Protect
Most serious infringements of working conditions [pages 16-18]
Implements Principles 1, 2 and 8
Even in advanced countries, we come across cases where employees find themselves in a highly vulnerable position and are required to put up with undignified working conditions, and where their employer, for instance, refuses to pay them. The victims of this abuse are frequently foreign nationals as they have limited opportunity to defend themselves. Evidence of such practices can also be found in the Czech Republic. Those working in other people’s households are another risk group. Such actions have fallout for employees, for the state (which is robbed of taxes and insurance contributions), and for honest businesses, who cannot compete with such labour.
Whereas minor cases of labour-law violations are subject to checks by labour inspection bodies, more serious cases can be prosecuted as crimes. However, for these modern-day unfair practices to be detected and prevented effectively, there needs to be coordinated cooperation between many state bodies and social partners. There may be numerous labour-law violations in supply chains, via temporary employment agencies, or at entities that act as recruiters but do not hold a permit to do so. To make it possible to stamp out these most serious forms of abuse, businesses themselves should pay attention to working conditions at their partners and, if they detect any breaches of the law, they should either demand that corrective action be taken or sever ties. The state’s role here is to create a functioning labour market that will not cater to illegal practices. This does not mean just the repression of the perpetrators, but also the shaping of conditions conducive to the legal employment of foreign nationals.
Current state of play:
- The Czech Republic has ratified the International Labour Organisation’s Private Employment Agencies Convention (Convention No 181).
- Directive 2008/104/EC on temporary agency work, regulating this area at EU level, and Directive 2009/52/EC providing for minimum standards on sanctions and measures against employers of illegally staying third-country nationals have been transposed into Czech law.
- A methodological guideline of the Inspector General of the State Labour Inspectorate Authority has been issued to harmonise inspection procedures in checks focusing on temporary agency work.
- The constituent elements of misdemeanours and administrative offences in labour law are being clarified.
- A law is being drawn up that will tighten conditions for the establishment and operation of temporary employment agencies. Users drawing on the services of such agencies are to be made co-responsible for the observance of commensurable wage and working conditions for temporary employees, and compulsory deposits are being introduced for each agency.
- The Ministry of Labour and Social Affairs hosts the Interministerial Body to Combat the Illegal Employment of Foreign Nationals, which plays a coordinating role, and the Economic and Social Agreement Council’s Working Party on the Mediation of Employment by Temporary Employment Agencies.
- A Concept for the Prevention of the Labour Exploitation of European Union Citizens in the Czech Republic has been produced.
- The Czech Republic activity combats human trafficking in accordance with the National Strategy to Combat Human Trafficking in the Czech Republic 2016-2019.
- Czech law contains procedures to help victims of human trafficking to legalise their stay and to find work. Although victims can take their claims to the civil courts, lawsuits tend to be lengthy and arduous for someone who cannot speak the language, is unfamiliar with the legal system, and does not have the money for a lawyer. In criminal proceedings, victims may be represented by an agent, such as a non-profit organisation.
- Under the National Strategy to Combat Human Trafficking in the Czech Republic 2016-2019, an analysis is being conducted of flaws in selected labour-law regulations that could pander to an exploitative working environment (Task 1 of the National Strategy).
- Focus, via labour inspection bodies, on unravelling the illegal employment of foreign nationals and running checks on temporary employment agencies and other entities acting as recruiters without the necessary permit.
Coordinator: Ministry of Labour and Social Affairs
- Evaluate the implementation of Directive 2009/52/EC providing for minimum standards on sanctions and measures against employers of illegally staying third-country nationals. The evaluation will include an analysis of the extra administrative burden and the ramifications for businesses.
Coordinator: Ministry of the Interior
Co-coordinator: Ministry of Labour and Social Affairs
Deadline: 31 December 2022
- Assess whether illegal employment is genuinely being earnestly prosecuted.
Coordinator: Ministry of Labour and Social Affairs
Deadline: Running, with a comprehensive assessment on 31 December 2022
- Make arrangements to raise foreign nationals’ awareness of their labour rights and obligations.
Coordinator: Ministry of Labour and Social Affairs
- Raise law enforcement agencies’ awareness of issues specific to human trafficking, with a stress on victim protection and the non-punishment principle (i.e. the impunity and protection of those who have been forced into criminal activity). Take this principle into account in the preparation of legislation that may touch on human trafficking and modern-day slavery.
Coordinators: Ministry of the Interior, Ministry of Justice
Criminal liability of legal persons in the field of human rights [pages 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 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 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 [pages 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.
- 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
Publication and dissemination of existing documents, education and awareness-raising [pages 9-11]
GP 2, 3c and 8
Increasing attention is paid to the theme of business and human rights in recent years. Many countries, international organisations and universities have produced numerous documents, model professional and theme-based codes of conduct, examples of good practice, recommendations and guidelines. Examples include recommendations and model codes published by the OECD, EU bodies, the Council of Europe and the ILO, as well as examples of good practice from the business community. However, these documents have not been gathered in one place. Businesses wishing to guard against human rights risks in their operations, perhaps by introducing new internal control mechanisms, adopting a code of conduct or incorporating human rights clauses into their contracts, may find it difficult to look up information.
A sound of response would be to find these documents, collect them in one place, classify them and, where necessary, translate them into Czech so that texts on business and human rights are made available to the general public. When new materials are drawn up, they should be written in plain language that a layman can easily understand.
The world’s universities are also aware of how important this subject is. The “Teach BHR” platform, grouping together those who teach business and human rights at universities, currently has 240 members from 140 institutions in 32 countries. It also offers ready-made study materials, workshops and experience-sharing forums. When it comes to Czech higher-education institutions, the University of Economics, Prague, runs a specialised course called “Business and Human Rights”, and other colleges cover this topic, for example, as part of their business ethics courses.
Current state of play:
- The Quality Council of the Czech Republic runs the National CSR Information Portal.
- The supreme judicial bodies publish summaries of key rulings, especially those relevant to human rights.
- Every year, the Government publishes a Report on the State of Human Rights and numerous other reports and documents analysing respect for human rights in the Czech Republic. Reports in the same vein are also published by other institutions, including the Ombudsman.
- The National Contact Point for the implementation of the OECD Guidelines for Multinational Enterprises is responsible for promoting the Guidelines and their instruments (seminars, training, promotional materials, etc.).
- The Ministry of Industry and Trade, in cooperation with the Czech Trade Inspection Authority has launched the “Consumer Protection” project to provide information on the latest developments in consumer law.
- Propose changes to the website of the National CSR Information Portal.
Coordinator: Ministry of Trade and Industry
Co-coordinator: Ministry for Human Rights
Deadline: 30 June 2018
- On the National CSR Information Portal, post documents and materials of business associations (the Czech Chamber of Commerce, the Confederation of Industry, the Confederation of Employers’ and Business Associations of the Czech Republic, industry associations, and others), trade unions and NGOs active in corporate social responsibility for those businesses that take the voluntary decision to subscribe to human rights commitments.
Coordinators: Ministry for Human Rights, Ministry of Industry and Trade
Deadline: Running, following the completion of the previous task
- Translate the UN Guiding Principles and other key documents into Czech.
Coordinator: Ministry for Human Rights
Deadline: 31 December 2017
- Provide the National Portal administrator with business and human rights documents that the ministries have at their disposal and that concern their scope of responsibilities.
Coordinators: All ministries
- Assess the vehicles in place to provide businesses with information on human rights risks in countries or regions where they are planning to set up operations.
Coordinator: Ministry of Foreign Affairs
Deadline: 31 December 2020
Non-financial reporting [pages 21-22]
Implements Principle 3d
Reporting on the activities of large companies works to the benefit not only of business partners and shareholders, but also other stakeholders. With this in mind, companies are increasingly reporting not only on their financial position, but so on the non-financial aspects of their operations. Information on the impacts that companies’ operations have on the environment, social aspects, human rights and the protection thereof is disclosed in separate non-financial reports or as part of the annual report.
Many companies already engage in non-financial reporting entirely voluntarily because this is regarded as a matter of prestige and an opportunity to improve their market position. Nevertheless, the European Union, having decided to coordinate non-financial information, has issued a Non-financial Reporting Directive.
The non-financial reports drawn up by certain large entities could become an important tool for transparency. The auditor examines whether an entity has drawn up non-financial information and disclosed it in the annual report or consolidated annual report, or whether it has produced a separate report. As non-financial reporting shoulders entities with a heavier administrative burden and extra costs, it is not compulsory for smaller entities, who will be able to decide for themselves whether or not to publish a non-financial report.
Current state of play:
- The Czech Republic has transposed the Non-financial Reporting Directive into Act No 563/1991 on accounting (in particular Part Eight thereof). Non-financial information will be disclosed by large public-interest entities with more than 500 employees. Information on respect for human rights will be a mandatory part of the report.
- The European Commission (DG FISMA) has produced general guidelines for businesses on how to apply the Non-financial Reporting Directive.
- Publish the European Commission’s general guidelines on the websites of the National CSR Portal, the Ministry of Industry and Trade and the Ministry of Finance, and in Finanční zpravodaj (“Financial Bulletin”).
Coordinator: Ministry for Human Rights, Ministry of Industry and Trade, Ministry of Finance
Deadline: 31 December 2017
- Provide information on the guidelines as part of training courses or in guidance and informational materials on non-financial reporting.
Coordinator: Ministry of Finance
2. State Duty to Protect Human Rights
2.2 Recommendations from the Council for CSR on the state duty to protect: [page 10]
Among other initiatives, the Council for CSR recommended that the Danish Government:
- Expands the existing Danish corporate non-financial reporting requirement to include mandatory reporting on human rights;
- Encourages responsible public procurement by requiring government contractors to perform due diligence on human rights in relation to the products or services covered by the contract, including regularly supervising the contractual requirements
- Requires state-owned companies and governments agencies which distribute significant government funds to incorporate due diligence in their business activities;
- Advocates joint solutions at international level, e.g. through the UN or the EU, in the areas of human rights, labour rights and the environment, to enable home countries to prosecute companies involved in particularly gross violations outside the home country’s borders; and also to
- Considers the possibility of relevant national measures that meet the need for prosecuting particularly gross violations. The recommendations from the Council on how the Danish Government can fulfill the UNGPs on the state duty to protect can be found here: http://www.raadetforsamfundsansvar.dk/dokumenter/0/16 (in Danish only)
2.3 Actions Take
Danish Government Expectations to companies [pages 11-13]
As part of the promotional activities among Danish companies the government has committed to providing courses and guidance on responsible business conduct. The Government has launched an information campaign specifically aimed at companies and NGOs on compliance with the Guiding Principles in connection with the establishment of the mediation and grievance mechanism (for more information see section 4.3).
The Trade Council under the Ministry of Foreign Affairs advises Danish companies and their local partners on how they should handle their social responsibility in a number of export markets. The advisory services include human rights due diligence. The advisory services are demand-driven and offered to companies on the same terms as the other business services of the Trade Council, i.e. chargeable by the hour in accordance with Danish legislation (UNGPs 3c).
In addition, at Danish embassies in emerging markets, the Trade Council in co-operation with the Danish Business Authority holds workshops in responsible supply chain management, especially focusing on small and mediumsized companies and their local business partners (GP 3c). The courses are held on an annual basis. They include practical guidance on how to demonstrate due diligence in business operations in regard to adverse impacts on human rights. To further assist Danish companies in emerging markets, the embassies are also conducting CSR reviews of local business partners. The reviews include a due diligence component (UNGPs 3c)
The Guiding Principles have proved to be an excellent instrument in rallying stakeholders for joint action. Using the Guiding Principles as the basis for a new Partnership for Responsible Garments Production in Bangladesh, the Danish government, business associations and enterprises have agreed on a number of detailed commitments to improve conditions within their sphere of influence. The partnership, which was agreed within the framework of the Danish Ethical Trading Initiative (DIEH), will be implemented in close co-ordination with international partners as well and stakeholders in Bangladesh.”
Protection of human rights through state regulation and policy
“In Denmark all new legislation is systematically evaluated in terms of human rights consequences by the Ministry of Justice. Denmark actively takes part in the Universal Period Review process of the United Nations as well as review by the UN Treaty Body Monitoring mechanisms with regard to obligations arising under the United Nations core human rights conventions, and by relevant ILO and Council of Europe bodies. These processes provide a platform for systematic consideration of the compliance of Danish law, policies and administration with international human rights law. Denmark duly takes account of findings and recommendations issued by such bodies.
Denmark is fully committed to human rights obligations – both nationally and internationally – and has signed and ratified many legal instruments, which belong to various organs, especially the United Nations, the European Union and the Council of Europe. (…) Denmark is one of the only countries in the world which has established the OECD National Contact Point by Danish law. The purpose is to ensure that the Danish NCP has a maximum of legitimacy and authority.
As stated in the strategy for Danish development cooperation: “The Right to a Better Life”, Denmark applies a rights-based approach to development. The human rights based approach entails that the goal of development cooperation should seek to realise human rights as well as poverty alleviation. Furthermore, political dialogue with partners and concrete development interventions should be guided by human rights standards and principles, focusing in particular on rights-holders and duty–bearers and their capacities to claim and fulfill obligations related to human rights. The “Protect, respect and remedy framework” also provides the basis for Danida’s institutional private sector programmes aimed at enhancing the capacity and institutional environment for private sector development. One prime example of this approach is the new “Program for Responsible Business in Myanmar”, using both the state duty to protect and the company duty to protect as the key parameters in its programme design.
Denmark works to ensure that companies involved in Danish development cooperation respect human rights and act responsibly within the areas of worker’s rights, human rights, environment and anti-corruption within the framework of ILO conventions, UN Global Compact, the OECD guidelines for multinational enterprises and work towards implementation of the UN Guiding Principles on Business and Human Rights.
Companies involved in Danida Business Partnerships – an instrument that facilitates and provides economic support to develop commercial partnerships between Danish companies and partners from developing countries – are now required to integrate CSR strategically in their business operations and to demonstrate due diligence, including human rights, in order to mitigate adverse impact. The Danida Business Finance instrument engages both local buyers and Danish companies in the promotion of human rights and CSR activities through due diligence analysis and requirements to comply with fundamental principles of ILO when providing interest-free loans to public infrastructure projects in developing countries.”
Protection of human rights in the business sphere in Danish legislation
General Danish law contributes to fulfilling Denmark’s duty under human rights treaties to which it is a party against human rights abuses by private actors, including businesses. For example, the Danish parliamentary act prohibits differential treatment in the labour market
from 1996 protecting against discrimination based on race, gender, skin colour, religion, political opinion, sexual orientation or national, social or ethnic origin. It is also an offense to refuse to serve a person on the same terms as others involved in commercial or non-profit company
because of his/hers race, colour, national or ethnic origin, religion or sexual orientation. The Working Environment Act of 2005 and the Act on the Work of Young Persons from 2005 implement the EU Directive 94/33/EC from 1994 on the protection of young workers, and the 1956
Constitutional Act of Denmark covers freedom of association and assembly.
Similarly, the Danish Data Protection Act helps to uphold the right to respect for private life; the Working Environment Act contributes to protecting the right to a safe and healthy working environment, the act protects, among other things, individuals against adverse impacts on
health due to environmental pollution from business sources and contributes to protecting the right to the highest attainable standard of health through regulating access to health services. Denmark’s Criminal Code protects the right to life and human rights against torture, slavery, while proscribing a range of activities connected with human trafficking, for example. The Criminal Code further provides that companies and company representatives can be punished under the Act while other criminal laws contain provisions in similar terms”.
Guidance to business is very strongly highlighted in the Danish NAP, with whole sub-sections in the narrative part describing actions already taken in this respect (e.g. Section 2.3).
Providing effective guidance on how to respect human rights
Since 2005, the Danish Government has worked directly with promoting CSR among Danish companies. The efforts have focused on providing companies with tools and guidance to implement CSR policies in a manner which is both strategic and manageable (GP 3c).
Examples of relevant tools include:
– The CSR Compass – which is a free online tool that helps companies implement responsible supply chain management. http://www.csrcompass.com/
– The Global Compact Self-Assessment Tool – which helps companies to test their performance on all ten UN Global Compact principles, and how well these issues are managed: http://www.globalcompactselfassessment.
org/. The tools have been developed in collaboration with the UN Global Compact and other partners from Danish civil society and industry organisations.
The Danish Government is committed to continuously improving and promoting guidance provided to companies on how to work with CSR in general and human rights in particular. To ensure that companies have the right tools and the necessary guidance to handle the new due diligence requirements, the Government has updated the existing web tool, the CSR Compass and the Global Compact Self-Assessment Tool in accordance with the due diligence requirements of the UNGPs. The revised Compass includes a guide for small and medium-sized companies on how to exercise due diligence (GP 17) and also gives guidance on ways to solve company conflicts by actively engaging in a dialogue with the company’s stakeholders (GP 29). The revised Global Compact Self-Assessment Tool works as a self-Assessment guide to a CSR due diligence going through a questionnaire covering aspects of human rights, worker’s rights, environment and anti-corruption and including a template for a follow up action plan.
Reporting requirement on human rights impact
Another priority for the Danish Government has been to strengthen the existing legal reporting requirement for the largest Danish companies and all state-owned companies (GP 3d).
Since 2009, large companies including all state-owned companies and institutional investors in Denmark have been required to report on their work on corporate social responsibility. This means that while Danish businesses are free to choose whether or not they wish to have a CSR policy there is a statutory requirement that they must take a position on CSR in their annual reports.
If the company has a CSR policy, the company must account for this policy in their annual reports, including any CSR standards, guidelines or principles the company employs. Secondly, the company must report how these policies are translated into action, including any systems or procedures used. Thirdly, the company must evaluate what has been achieved through the CSR initiatives during the financial year, and any expectations it has regarding future initiatives. If the company does not have any social responsibility policies, this must be reported.
In June 2012, this reporting requirement was expanded so that the largest Danish companies from 2013 expressly must state in their reports what measures they are taking to respect human rights and to reduce their impact on the climate. This means that if a company has a policy on human rights or climate issues, it must report according to the existing structure; what is the policy, how has the policy been translated into action and what has been achieved through the initiatives. If the company does not have policies for human rights or climate issues, this must also be disclosed. The purpose is to further strengthen Danish companies’ activities in relation to human rights and climate change which will be beneficial to society overall, but also to the individual company.
Three years after the reporting requirement was introduced, analyses show that companies generally appear to have been encouraged to report on CSR. In the course of the first three years of the legal requirement’s existence, nearly 50% of the companies reported on CSR for the first time. Secondly, there have been significant improvements in reporting practices in a number of areas. There is, nevertheless, still room for improvement as regards reporting consistency and reporting on the results of the CSR work.
2.4 Planned Actions
Extraterritorial legislation [page 16]
To further engage in the issue of extraterritorial legislation, the Danish Government has planned the following initiative:
– At national level the Government will put together an inter-ministerial working group which will discuss the need for and feasibility of legislation with extraterritorial effect in areas of particular relevance. The group will look at what other countries have done and are doing in this area with the purpose of learning what works and what does not work. Finally, the group will examine the need for judicial prosecution of severe human rights impacts as recommended by the Danish Council for CSR.
Promoting CSR in the Public Sector
The Government wishes to establish good framework conditions for social responsibility as the public sector’s contribution to the promotion of responsible growth. This is the reason why the new mediation and complaints handling institution can handle complaints about human rights impacts and other adverse impacts on international guidelines by public authorities, as is the case with private companies (see section 4.3 for more information). The public authorities should assume social responsibility relating to environmental, social and economic conditions as well as human rights in connection with their activities. To obtain this objective, the Government will invite municipalities and regions to jointly prepare guidelines for how public authorities can avoid having an adverse impact on international guidelines. The guidelines should be used to manage the challenges the public authorities are facing today when acting as a private company.
3. The corporate responsibility to respect human rights
3.2 Recommendations from the Council for CSR on the corporate responsibility to respect [page 17]
In June 2010, the Council published a set of guidelines for responsible supply chain management based on the Protect,
Respect, Remedy Framework. The Council also made sure that the guidelines were aligned with recognised international principles like the UN Global Compact, ISO 26000 etc. The guidelines were meant as a supplement to the Protect, Respect, Remedy-Framework, intended to provide greater clarity about responsible supply chain management by offering a practical, easy-to-read guide and online tool. The guidelines are supplemented by a checklist of self-help questions intended to help the individual company find the solutions that address their specific challenges. For the guidelines in its entirety, see: www.csrcouncil.dk/guidelines.
While the guidelines are focused on assisting companies with the implementation of the UNGPs with regard to supply chain management, implementation of the corporate responsibility to respect continues to be a very important part of the council’s agenda.
3.3. Actions Taken
Expectations to companies and other stakeholders to respect human rights [page 18]
“In order to fulfill their requirements companies need to be able to know and show that they respect human rights. The Government therefore wants to create more transparency about the CSR efforts of both private companies and public authorities. It is only through increased transparency that CSR can become a key parameter for consumer choices. Danish legislation thus requires major Danish companies to report on social responsibility in their annual reports including what specific measures they have taking to respect human rights and reduce their adverse impact on the climate (GP 3d). For more information on the legal reporting requirement on human rights see section 2.3.
Evaluating of CSR reporting in large and listed Danish companies
In 2008, Danish Government introduced a legal requirement for large companies in the Danish Financial Statements Act (see section 2.3 page 6 for more on the reporting requirement). Since the statutory CSR reporting was introduced a survey on the effects of the legal requirement has been conducted in three consecutive years. The surveys were based on a rolling group of participants, meaning that the same group of companies has been surveyed the previous years. Since the group has been subject to the reporting requirement for three years it includes – in the last survey – very few companies reporting for the first time. As expected, there have also been few changes in the choice of topics and content in the reports. In the financial year9 2010, a significant increase in the number of companies reporting actions relating to human rights (38% compared to 16% in 2009) and labour rights (35% compared to 16% in 2009) was noted. In the 2011 financial year, these reporting topics were as common as in 2010. Due to recent developments in international CSR principles (in particular the development of the UN Guiding Principles on Business and Human Rights), an increased focus on human rights, in particular, can be expected in the future. Following the latest amendment of Section 99a of the Danish Financial Statements Act, companies thus have to report on the topics of human rights and climate with effect from the 2013 financial year.
Appendix 1. Overview of the implementation of the state duty to protect
GP 3a [page 26]
Status in Denmark (initiatives implemented before the UN ratification of the Guiding Principles)
- In Denmark all new legislation is systematically evaluated in terms of human rights consequences by the Ministry of Justice.
- Denmark actively takes part in the Universal Period Review process of the United Nations. Denmark also takes part in the review by the UN Treaty Body Monitoring mechanisms with regard to obligations arising under the United Nations core human rights conventions, and by relevant ILO and Council of Europe bodies. These processes provide a platform for systematic consideration of the compliance of Danish law, policies and administration with international human rights law. Denmark duly takes account of findings and recommendations issued by such bodies.
Status in Denmark (initiatives implemented before the UN ratification of the Guiding Principles)
- The Government’s 2007 Action Plan was prepared by an inter-ministerial working group with representatives from a variety of departments and agencies. The working group still coordinates the Danish government’s initiatives in the area of social responsibility.
- As mentioned in GP 3a, 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.
Status in Denmark (initiatives implemented before the UN ratification of the Guiding Principles)
- The Danish Government’s CSR policy is especially focused on developing knowledge and tools that are directly applicable to businesses. Whenever possible these tools are developed in cooperation with relevant stakeholders. Tools with a direct focus on human rights include the CSR Compass and the Global Compact Self-Assessment tool, developed by the Ministry of Business and Growth, the Confederation of Danish Industry, the Danish Institute of Human Rights and the Danish Investment Fund for Developing Countries.
- Danida has provided financial support to the UN Global Compact for a number of years and also provided support to John Ruggie’s work on developing the UNGPs as well as support to the UN Working Group’s work in promoting the implementation of the principles in practice.
Initiatives taken or planned as a dedicated measure to implement the UNGPs (after the UN ratification of the Guiding Principles)
- To make sure companies have the right tools and the necessary guidance to handle the new reporting requirements, the Government will continue to improve and promote the guidance provided to companies via a revision of an existing web-based tool.
- To promote responsible business conduct among Danish businesses, the government has also committed to providing courses and guidance on responsible business conduct.
- In connection with the establishment of the Mediation and Complaints-Handling Institution for Responsible Business Conduct the Government has therefore launched an information campaign on compliance with the UN Guiding Principles.
- The Danish Government is highly committed to the UN Global Combat and the UN Guiding Principles on Business and Human Rights and works for even closer cooperation between the two sets of principles.
- The Trade Council under the Ministry of Foreign Affairs advises Danish companies and their local partners on how they should handle their social responsibility in a number of export markets. The advisory services include human rights due diligence. The advisory services are demand-driven and offered to companies on the same terms as the other business services of the Trade Council, i.e. chargeable by the hour in accordance with Danish legislation.
- The Trade Council in co-operation with the Danish Business Authority holds workshops in Responsible Supply Chain management, especially focusing on small and medium-sized enterprises and their local business partners (GP 3c). The courses are held on an annual basis. They will include practical guidance on how to demonstrate due diligence in business operations in regard to adverse impacts on human rights. To further assist the Danish companies in emerging markets, the embassies are also conducting free CSR reviews of local business partners. The reviews include a due diligence component.
- Whenever necessary, the government also initiates and drives multi-stakeholder partnerships based on the Guiding Principles. This year the government established the partnership for Responsible Garments Production in Bangladesh, gathering all the major Danish stakeholders within
- the industry and linking the partnership up with international public and private partners to achieve joint action.
- Companies involved under Danida Business Partnerships are required and guided to undertake a CSR due diligence covering human rights, workers’ rights, environment and anti-corruption and to follow-up with an action plan in order to mitigate adverse impacts of business activities on employees and society at large.
- The ministry of Foreign Affairs is also working on competence development courses within UNGPs and CSR for embassy staff, including e-bites, guidance on how to perform CSR due diligence and workshops for Danish companies operating abroad and local companies in new growth markets.
- In 2013, a number of Danish organisations have been granted support by Danida for initiatives focusing on the promotion of ethical trading initiatives and supply chain management, CSR and Fair Trade.
GP 3d [page 27]
Status in Denmark (initiatives implemented before the UN ratification of the Guiding Principles)
- Mandatory CSR reporting.
As part of the first national action plan for CSR, the Danish Government introduced a reporting requirement to ensure that major businesses, institutional investors and unit trusts report on their CSR work in the management review of the annual reports. The duty to report for major businesses, institutional investors and unit trusts has entailed an obligation to report on their CSR policies and how they implement the policies in practice. Businesses and investors must also report if they have yet to set up policies for the area. This fact must appear from the management review of the businesses’ annual reports.
Initiatives taken or planned as a dedicated measure to implement the UNGPs (after the UN ratification of the Guiding Principles)
- Reporting on human rights and climate
- From 2013 the 1,100 largest Danish companies and all state-owned limited liability companies must report on CSR in their annual reports. The Government will introduce a bill proposing that the largest Danish companies and state-owned limited liability companies in future must expressly state in their reports what measures they are taking to respect human rights and reduce their impact on the climate.
2. The state obligation to protect human rights
2.1 Human rights in Finnish legislation [page 13]
Finland is strongly committed to the protection and promotion of human rights through national legislation and international cooperation. Our reinforced Constitution protects the inviolability of human dignity as well as the freedom and rights of individuals, and promotes justice in society. Fundamental rights (such as equality, freedom of movement, protection of privacy, freedom of association, freedom of speech and the right to social security and judicial protection) have been included in the Constitution.
According to the equality provision of the Constitution, no one may be treated differently based on sex, age, origin, language, religion, conviction, opinion, health, handicap or other reason related to the individual. In addition, the Constitution states that children should be treated equally as individuals and that it should be possible for them to be involved in matters relating to them in accordance with their development. The current public authority, municipality or other body exercising public authority must ensure the realization of fundamental and human rights.
The generał principle of Finnish legislation is that it is based on fundamental and human rights. Human rights under the Constitution are ensured in all legislation.
According to treaty law, Finland is obliged to implement international conventions, including human rights conventions to which it is bound. National legislation should be in harmony with the obligations of international and regional human rights conventions, and it should be applied and interpreted favorably with regard to human rights.
However, on an international level states implement human rights conventions differently. This affects international business activities and their regulation. The international preparation and development of the UN principles deal with the legal regulation of cross-border business activities. The concept of human rights is very extensive, and the creation of mare binding regulation for non-state actors (such as companies) would require specifying their obligations in relation to the obligations of states. The challenges of such regulation are related to features such as the generał definition of the criminal liability of legal entities, the territorial application of criminal legislation, protection of the accused, definition of the civil liability for damages, functionality of legal redress, and territorial limitations of jurisdictions. Due to these challenges, the matter requires that further examination and analyses be made on both the national and international level.
For continuing both the national and international discussion, it would be essential to further clarify features such as the applicability of national legislation to international business activities. For this reason, the working group proposes that as a follow-up measure, a report be commissioned on Finnish legislation in relation to the regulation and guidance of international business activities, particularly to prevent serious human rights violations and to remedy any existing violations. Principal responsible party: Ministry of Justice, Ministry of Employment and the Economy and Ministry for Foreign Affairs, schedule by mid-2015.
2.2 The State and the protection of privacy [page 23]
The protection of privacy that is particularly related to electronic communications has received plenty of attention in recent public discussion. The right to privacy, the protection of personal data and the protection of confidential messages are fundamental human rights. The extent of data collection related to electronic communications has led to public discussion. Privacy questions related to electronic communications are particularly important in Finland, where the ICT infrastructure enjoys a strong position. This strength has played a significant role in the fact that Finland has been able to attract international ICT investments.
As a fellow-up measure, the working group proposes that
- a roundtable discussion be organised on how to ensure the protection of privacy in Finland with the authorities, ICT companies and the civil society. Principal responsible party: Ministry of Transport and Communications, autumn 2014.
3. Expectations towards companies and support services
3.1. Clarification of due diligence [page 23]
The OECD Guidelines for Multinational Enterprises were updated in 2011. In the same connection, the UN Guiding Principles on Business and Human Rights were included in the Guidelines along with due diligence. In the OECD Guidelines, due diligence is seen as an examination process with which companies identify and prevent the actual and potential adverse impacts of their activities in their decision making and risk management. This means that due diligence is not a single action. lnstead, it is an ongoing process where the human rights impacts of business activities are assessed with appropriate and sufficient care.
Due diligence also includes the mitigation of adverse impacts and communication on how companies deal with these adverse impacts. Potential effects are dealt with by preventing or mitigating them, whereas actual impacts will be dealt with by remedying them.
By following due diligence, an attempt is made to prevent the adverse impacts which a company will either cause itself, to which it will considerably contribute towards, or which are directly related to the company’s activities, products or services through a business relationship.
The contribution refers to a situation where that contributing impact is substantial. This means activities resulting in indirect adverse impacts caused, promoted or encouraged by another party. This does not cover minor or insignificant contributions. If a company contributes to a detrimental effect on human rights, it should take the necessary measures and use its influence to prevent or alleviate the adverse impact.
In the Guidelines, business relationships cover relations with business partners, supply chain operators and other operators independent of the state and governmental operators that are directly related to the company’s business activities, products or services. If the company has a lot of suppliers, it should identify the areas where the risk of adverse impacts is highest and contribute to the prevention of these risks.
What it sufficient?
At the consultation events organised by the working group, it was suggested that a new statutory obligation on due diligence should be established for companies when implementing the UN principles on a national level.
Transforming the due diligence described above into a legally binding obligation is difficult to envisage. The problem with statutory due diligence for respecting human rights is the difficulty of defining the obligation included therein. On a national level, respecting human rights is defined in appropriate legislation, and careful actions may be important for assessing company responsibilities. Extending national legislation to international activities is even more challenging. The special questions related to the regulation of international business activities have been described above in Section 1.1.
According to the international guidelines, the sufficiency of following due diligence and the possibilities of making a difference are always weighed on a case by-case basis. The issues mentioned above (such as the size of the company, branch of activity, operating conditions, ownership and business structure) are taken into consideration. The seriousness of the adverse impacts caused is important as well. Since both the UN principles and the OECD Guidelines emphasise prevention, a retrospective assessment on sufficiency will cause challenges of its own for preparatory actions.
The discussion on the content of due diligence and the ways it is applied also continues in international organisations.
Though there is no binding regulation on due diligence, it is a central concept in
managing human rights risks related to international business activities. For these reasons, more discussion and information is required on the types of risks an possibilities related to each branch of activity, on the types of risk management needed, and on the expectations for observing due diligence in various branches of activities.
As a follow-up measure, the working group proposes that
- companies, non-governmental organisations and other key stakeholders are invited to a roundtable discussion by branch of activity. For example, the discussion could begin with the forest industry, the consumer goods trade and the textile industry.With the discussions, an attempt shall be made to create a dialogue amongst various stakeholders and to establish the essential risks for each branch of activity as well as sufficient risk management and due diligence.
- In co-operation with the business sector, the collective industrial organisations and non-governmental organisations, sharing of due diligence best practices is promoted in order for companies to apply them.
Principal responsible parties: Ministry for Foreign Affairs and Ministry of Employment and the Economy, schedule by the end of 2015.”
3.2 Reporting on corporate social responsibility [page 25]
Reporting on corporate social responsibility may be a significant factor in monitoring the human rights impacts and risks of companies. In the Resolution on Corporate Social Responsibility, the Finnish Government encourages companies to publish the non-financial data on the social and environmental impact of their activities. The Ministry of Employment and the Economy and the Ministry of the Environment are involved in organising the annual competition for reporting on corporate social responsibility. The competitions have been organised since 1996 with a view to encourage companies to report on CSR. When reporting becomes mandatory for some of the companies (cf. Section i.3 on non-financial reporting), the question of reforming the competition must be addressed.
International information on the content of companies’ responsibility reports is available in a database maintained by the Global Reporting Initiative (GRI). In Finland, Corporate Responsibility Network FIBS acts as a partner for GRI for all Finnish companies and organisations to register their responsibility reports in the database. By means of the database, companies’ responsibility reports can be compared by branch of activity and by geographical area. The database also provides useful information concerning the international corporate social responsibility standard to which each report refers.
As a follow-up measure, the working group proposes that
- human rights be adopted as the annual theme of the reporting competition. Principal responsible party: Ministry of Employment and the Economy, schedule before the end of 2015.”
3.4 Team Finland cooperation
The Team Finland network was established in 2012 to promote the Finnish cause abroad. This entity includes Finland’s financial foreign relations, the internationalisation of Finnish companies, the foreign investments made in Finland and the image of Finland as a country. The objective is to create a clear and customerorientedoperating model where the central domestic and foreign operators are invited to sit down to a discussion at the same table. The activities of Team Finland are guided by common objectives that are confirmed by the government each year. The core of the Team Finland network consists of the Ministry of Employment and the Economy, the Ministry for Foreign Affairs, the Ministry of Education and Culture, and the publicly funded organisations and foreign offices operating under these ministries (such as Finnish foreign services, the Finpro and Tekes offices, and cultural and scientific institutes). Cooperation with companies, organisations and institutions of higher education is also extremely important in matters related to business and human rights. As an existing forum, Team Finland may operate as an excellent platform for bringing forward human rights factors related to business activities.
As a follow-up measure, the working group proposes that
- the Team Finland network provide interactive training on the theme of business and human rights;
- in connection with travel for export promotion, questions related to human rights and CSR are taken into For instance, by including a concise overview of the human rights situation of the target country in the background materials.
- Questions related to human rights and corporate social responsibility shall be included in the service selection by the Team Finland network provided by Finnish foreign Ministry for Foreign Affairs and Ministry of Employment and the Economy shall provide the support materials required for counselling.
Principal responsible party: Ministry for Foreign Affairs and Ministry of Employment and the Economy, continuous activities.
3.5 Support for Finnish and international organisations promoting the subject [page 27]
Defenders of human rights, trade unions and other civil society operators can play an important role in the assessment of the impact of business activities on human rights, the availability of legal remedies and national and international discussion. Finland has a strong tradition of mutual interaction between the authorities and civil society operators. The collaboration between labour market parties is part of the Finnish social contract. Ministries support the business and human rights activities of Finnish and international non-governmental organisations in various ways.
The Ministry for Foreign Affairs uses development cooperation funds to support international organisations, programmes and initiatives which promote the theme of business and human rights. For instance, the Ministry for Foreign Affairs has supported the following projects:
The UN Global Compact CSR initiative for EUR 350,000 in 2013 and its Business for Peace initiative for EUR 200,000 between 2013 and 2014. The activities focus on features such as human rights, gender equality, good governance and environmental affairs.
In 2014, approximately EUR 17 million were spent to support the projects of the International Labour Organisation (ILO). The projects are related to matters such as rights at work, green workplaces for the construction sector, the inclusion of women in the labour market, and decent work.
Employment and the Economy, continuous activities.
The OECD Policy Framework for Investment is being modernised to face the challenges of sustainable development, such as equality, CSR and human rights.
Each year, the Ministry for Foreign Affairs also supports the development cooperation projects for Finnish non-governmental organisations as well as communications and global education projects. Support is also provided for projects promoting the theme of human rights and business.
As a follow-up measure, the working group proposes that
- the possibilities of funding new programmes or initiatives be examined. These programmes or initiatives should be related to business
- and human rights, particularly trade, business activities and rights at work, and they may have significantly positive effects on development.
Principal responsible party: Ministry for Foreign Affairs, schedule 2014 to 2015.
I. The State Obligation to Protect Human Rights [page 11]
France adheres to all the instruments that are part of the international business and human rights framework, and is present in all relevant forums (the United Nations–UN, the International Labour Organization–ILO, the Organisation for Economic Co-operation and Development–OECD, the European Union–EU, the Council of Europe, the International Organization for Standardization–ISO, etc.).
Proposals for Action No. 1 [page 16]
- The French Government and French businesses are committed to addressing their actions’ adverse impacts on populations in regions in which they operate, in France and abroad, in accordance with the country’s obligation to provide protection under the ICESCR.
- As outlined in the UN Guiding Principles, France encourages embassies to be vigilant with respect to the human rights and environmental performances of French economic actors. In particular, the French Ministry of Foreign Affairs and International
- Development has sent the CSR guide to all diplomatic posts since 2015. Actions to be implemented
- Implement the UN Guiding Principles in the battle against climate change, following commitments made during COP 21.
Proposals for Action No. 2 [page 18]
- 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.
- France’s General Secretariat for European Affairs will support this work and distribute relevant documentation to lead ministries, in order to guarantee inter-ministerial coordination on European issues and their assessment by European institutions.
The National Framework
9. The Protection of Human Rights and the Environment [pages 22-24]
In addition to international treaties, which take precedence over national laws, some of these principles are guaranteed in constitutional documents, including the Declaration of Human and Civic Rights of 1789 (published in the preamble) and the Charter for the Environment of 2004.
The charter acknowledges a number of rights, including “the right to live in a balanced environment which shows due respect for health” (Article 1), the obligation for public policies to “promote sustainable development” and “reconcile the protection and enhancement of the environment with economic development and social progress” (Article 6), the right to “have access to information pertaining to the environment” and to “participate in the public decisiontaking process likely to affect the environment” (Article 7), as well as the principles of precaution and prevention in the environmental field.
These constitutional guarantees justify a number of standards that apply to consumer products. However, they can be challenged as a result of free trade agreements.
10. The Reinforcement of legislation
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:
o 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.
o 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 information published.
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 10 July 2014 on unfair social competition was adopted to transpose into national law the European Directive on the posting of workers, which seeks to fight illegal labour practices and fraud in this field. Not only does the act create due diligence obligations, it also provides for joint liability (over and above the requirements in the European Directive) whenever posted workers are used (it establishes the liability of project owners and principals with respect to their subcontractors and co-contractors).
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.
12. The French Platform for Promoting Global Action on Corporate Social Responsibility [pages 26-27]
In a letter dated 24 July 2012, 16 organisations representing employers, employees and civil society asked the French Prime Minister to set up a national platform to support dialogue and consultation between different actors in French society with an interest in CSR (including representatives of businesses, employees, non-profit organisations, NGOs and multi-stakeholder structures) and public authorities (including representatives of central administration, parliament and local government). Its main goal was to prepare a response to the European Commission’s request that Member States establish “their own plans or national lists of priority actions to promote CSR in support of the Europe 2020 strategy”.
The Prime Minister agreed to this request and created the French platform for promoting global action on CSR on 17 June 2013.15.
The French platform for promoting global action on CSR is a multi-stakeholder consultation body that is composed of five main groups: economic organiaations, trade unions, CSR researchers and developers, public institutions and civil society.
Proposal for Action No.4
- The State and local government are committed to promoting and respecting the UN Guiding Principles in all of their activities—as lawmakers, employers and producers.
- France is implementing the act on the corporate duty of vigilance.
Actions to be implemented
- Give government services the financial and material resources required to monitor the enforcement of the UN Guiding Principles.
- Encourage the centralisation of documentary resources for economic actors so they are more easily accessible by creating, for example, a digital platform for business and human rights.
14. Reinforce risks analysis and information [pages 29-36]
The State must be exemplary and apply all international framework texts on CSR, especially in the human rights field. To do so, it conducts activities providing information and training on the implementation of all major international CSR texts.
On 8 July 2002, France ratified the Aarhus Convention on Access to Information, Public Participation in Decision-Making and Access to Justice in Environmental Matters. This convention seeks to ensure that everyone is able to receive information, participate in decision-making and access justice in the environmental field. As stated in the preamble, “adequate protection of the environment is essential to human well-being and the enjoyment of basic human rights(…). The National CSR platform issued recommendations to: “Involve the State in efforts to inform, be exemplary and monitor the implementation of the main international framework texts on CSR, especially in the human rights field: – Conduct activities providing information and training on the implementation of all major CSR texts; – Include CSR in graduate studies and continuing education; – Ensure that businesses are aware of and comply with these texts.”
Proposal for Action No. 6
Actions to be implemented
- Complete comparative country risk and industry risk analyses.
- Hold collective discussions on risk analysis.
- Look into creating a database combining embassy information and information from other sources (business circles, international organisations, trade unions, NGOs, etc.)
- Produce and distribute an educational document summarising and comparing the main international texts by allocating sufficient resources, particularly to the main public websites concerned.
- Continue to distribute the information brochure and raise awareness among embassies.
- Provide training, particularly to staff of the State and local government, on human rights and environmental obligations for businesses (in business schools, engineering schools, the judiciary, etc.).
Proposal for Action No.7
All economic sectors:
– Reinforce due diligence, particularly in sectors and countries at risk of human rights abuses. – Encourage French businesses to develop and implement due diligence plans on the basis of their size. – Capitalise on the observations in the French NCP’s report on the textile and garment sector and begin promoting and adapting these recommendations so they can be enforced in all sectors.
Agriculture and Food Sector
- Partner States are encouraged to apply the Voluntary Guidelines on the Responsible Governance of Tenure of Land (VGGT) and the Principles for Responsible Investment in Agriculture and Food Systems (RAI). – Recommendations in the Guide to Ex-Ante Analysis of Agricultural Investment Projects that Affect Land and Property Rights are being integrated into the AFD’s due diligence procedures in the land, social and environmental fields.
Actions to be Implemented
- Ensure the VGGT and RAI are respected by French economic actors abroad. Training on the implementation of these principles and directives will be offered to government employees (in embassies and economic services) and agencies.
The textile and garment sector
- France is continuing to raise awareness of the NCP report issued on 2 December 2013, and monitor the implementation of its recommendations in the French textile, garment and distribution sectors.
- France is helping to finalise the OECD Due Diligence Guidance for Responsible Supply Chains in the Garment and Footwear Sector.
- France is promoting the mutualisation of audits by outsourcing companies through the working group created by the Ministry of Labour and relevant actors in cooperation with ILO, in connection with initiatives currently being examined by the OECD and European Commission.
- France is determining whether to support the “Vision Zero Fund” following the G7’s Leaders’ Declaration at Elmau.
The extractive sector
- France has launched an ambitious process to become an EITI country.
- France raises awareness among French businesses of their due diligence obligations with respect to mineral supply chains as set out in relevant regulatory initiatives (the OECD Due Diligence Guidance, the EU Conflict Minerals Regulation and national law on due diligence).
The financial sector
- France promotes, at the national and European levels, investment policies that incorporate due diligence and highlight the principles and practices of institutional investors.
- France promotes initiatives and commitments by the financial sector, particularly those based on the Equator Principles and the Thun Group.
- France is examining whether to extend environmental, social and governance reporting requirements for institutional investors in Europe to cover human rights.
II. Businesses’ Responsibility to Respect Human Rights
Proposal for Action No.8 [pages 38-45]
- France is reinforcing training for employees on issues related to business and human rights.
- The French Ministry of Foreign Affairs and International Development issues advice for businesses operating in conflict zones and/or high-risk areas.
Actions to be implemented
- Monitor the implementation of legislation requiring some companies to disclose due diligence plans addressing subsidiary and subcontractor risks at each level of the supply chain, and, if necessary, take measures to enforce this legislation.
- Help achieve the Sustainable Development Goals.
- Reinforce human rights requirements in purchasing criteria.
- Promote social dialogue and employee expression as tools to reinforce respect for human rights at all levels of the supply chain.
1. Chapters and Codes of Conduct
Charters and codes of conduct are voluntary initiatives that create legitimate expectations among stakeholders. Company charters aim to: − Set down and disclose the company’s commitments to human rights;
– Explain expectations to employees, subsidiaries and subcontractors.
The following points are key to their implementation:
− They must send a clear and strong message from the highest level of the business;
− They must enable businesses to respect internationally recognized human rights and make commitments appropriate to their size and activity;
− They must cover relationships with commercial partners and not be limited to “direct” activities.
− The Guide on How to Develop a Human Rights Policy, published by the UN Global Compact, which contains recommendations for businesses on developing and implementing human rights policies (https://www.unglobalcompact.org/library/22);
− Examples of human rights commitments by international businesses, collected by the Business and Human Rights Resource Centre (https://businesshumanrights.org/en/company-policysteps);
− The charter for French businesses working in Africa, which was adopted at the AfricaFrance Summit in 2010;
− The Human Rights Reporting and Assurance Frameworks Initiative (RAFI);
− The Fibre Citoyenne initiative, aimed at businesses in the textile-garment sector, by the NGO Yamana.
2. Training and Information for Businesses
All staff members must be made aware of CSR. Because CSR involves protecting, developing and enhancing an organization’s human capital, it is dependent on training. Training is central to sustainable development, enabling people to adapt their skills to economic, professional and societal changes. Training efforts must also target appropriate populations.
Thanks to the implementation of innovative partnerships between the public, private and nonprofit sectors, regional movements are providing information, raising awareness, offering training and supporting actions to defend and promote human rights. Regional business networks are also committed to human rights, women’s rights and the rights of newcomers, workers, vulnerable populations, etc. These networks, which support multi-stakeholder dialogue and operations, develop tools and initiatives adapted to the needs of businesses (micro, small, medium and large enterprises) using cooperative approaches.
Proposal for Action No. 9
- Training efforts are being continued, especially in the fields of purchasing, employee representatives, etc.
- Measures may be examined with businesses to encourage adherence to rules on the products authorised for sale and consumption in countries that have ratified the UN Guiding Principles.
Existing tools and responsible practices:
– Entreprises pour les Droits de l’Homme (Businesses for Human Rights – EDH) is a non-profit organization bringing together 12 French businesses working in various sectors. It has developed an e-learning tool and one-day training programme on business and human rights for employees (http://e-dh.org/fr/formation.php);
– The Global Business Initiative on Human Rights (GBI) is a platform bringing together 18 businesses from various sectors operating in 190 countries. It organizes learning workshops where businesses can share knowledge on human rights issues: good practices, tools, challenges, etc. (http://www.global-business-initiative.org); − Some businesses include human rights modules in sustainable development training programmes for directors. Others offer specific training to purchasers, human resources staff, legal staff, etc.
3. Risk Analysis and Impact Assessment
Businesses must understand the type and scope of adverse human rights impacts (both real and potential) caused directly or indirectly by their operations, particularly in their business relationships. This enables them to identify measures to prevent, remedy and mitigate these impacts. Practically speaking, businesses analyse their human rights risks by:
– Using external risk analysis tools (see below), which may or may not be adaptable;
– Identifying human rights issues that are specific to their operations or sector;
– Carrying out country risk assessments by compiling the available external data;
– Carrying out background checks and audits on suppliers and other stakeholders.
Many tools are available to help businesses analyse risks and assess the impact of their operations. If necessary, they can also call on employers’ organizations and other appropriate stakeholders.
Proposal for Action No.9
The following points are key to the implementation of risk management measures:
- Impact assessments must be completed for new operations, projects, commercial relationships, countries, etc.;
- Human rights risks must be regularly evaluated for all of the business’s operations, and action plans implemented for the risks identified;
- Issues specific to the operation, country and commercial relationships must be addressed.
Actions to be implemented
- Promote the completion and publication of voluntary impact assessments, ensuring that all appropriate stakeholders are included (if necessary, through the free, prior and informed consultation of populations), particularly rights holders for companies that are not required to complete project-specific impact assessments, and ensure these assessments are monitored.
Existing tools and responsible practices:
Self-assessment tools: The Global Assessment Tool (2010), produced by the Global Compact, and the Human Rights Compliance Assessment 2.0 (2010), produced by the Danish Institute for Human Rights, can be used to check whether business practices comply with the UN Global Compact and the UN Guiding Principles on Business and Human Rights. Country risk assessment tools: Data on national legislation, treaty ratification and existing practices in countries can be found on the following websites:
The Human Rights and Business Country Guide website: http://hrbcountryguide.org;
The websites of international organizations:
The UN: (www.ohchr.org/EN/Countries/pages/HumanRightsintheWorld.aspx);
The United States Department of State (www.state.gov/j/drl/rls/hrrpt/) for annual country reports on human rights practices;
The Maplecroft website (paying subscribers only) for country-specific human rights risk indexes and ratings (www.maplecroft.com).
Practical tools addressing specific issues:
The Business and Human Rights Resource Centre (www.businesshumanrights.org) is an online library with connections to a wide range of working documents and conceptual tools published by businesses, NGOs, governments, sector-specific initiatives and institutions. Many tools have been sorted by issue, country, sector or company policy/steps (policy, impact assessment, training, reporting, etc.).
ILO has created a business helpdesk providing questions and answers, resources and tools on issues connected with workers’ rights: discrimination, freedom of association, collective bargaining, wages and benefits, occupational safety and health, forced labour, child labour, etc. It also offers free and confidential assistance for company directors and workers (http://www.ilo.org/empent/areas/businesshelpdesk/lang–en/index.htm).
The Human Rights and Business Dilemmas Forum helps businesses understand and resolve the human rights dilemmas they face, particularly in emerging countries. For each dilemma, it outlines the relevant international standards, risks for businesses, case studies, practical suggestions and available resources (http://human-rights.unglobalcompact.org).
At the European level:
– The website of the Ministry of Foreign Affairs − Assistance offered by the European Instrument for Democracy and Human Rights (EIDHR)
– The European Commission’s working document dated 14 July 2015 on the creation of business practice guides
– The European Commission’s guides for three economic activities: employment and recruitment agencies; oil and gas; and information and communications technologies
− The CSR Compass (2005), a self-assessment tool supporting CSR policies for Danish businesses, with a special focus on SMEs and businesses with an international presence –
Tools produced by the Danish Institute for Human Rights: the Human Rights Compliance Assessment (HRCA), the HRCA Quick Check (a free and more concise version of the HRCA), the China Business and Sustainability Check, etc. − The Business Anti-Corruption Portal for recruitment agencies, oil and gas industries and ICT
At the sector level:
– Distribution: Initiative Clause Sociale (Social Clause Initiative – ICS)
− Electronics: Electronic Industry Citizenship Coalition (EICC)
– Chemicals: Together for Sustainability
− Finance: Equator Principles for Financial Institutions (EPFI)
Oil and gas: the Business and Human Rights Project by the International Petroleum Industry Environmental Conservation Association (IPIECA)
− Telecommunications: Industry Dialogue
Proposal for Action No.11
- France encourages the generalisation and reinforcement of international framework agreements that include human rights criteria, measures to regularly monitor their implementation and ex-post evaluation mechanisms
Proposal for Action No.12
- France ensures staff representative bodies have sufficient operating resources to defend human right
Businesses must monitor the human rights measures they adopt and disclose on their initiatives 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.
Proposal for Action No. 13
- 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.
- The performance of measures adopted by businesses to respect and communicate on human rights can be monitored in the following ways:
− By using existing global and sector-specific indicators or new company-specific indicators, and by formalizing internal annual reporting systems for the actions implemented;
– By including points to be checked in existing internal supervisory mechanisms;
− By monitoring and addressing human rights incidents;
− By issuing annual reports that can be viewed by the public.
Existing tools and responsible practices:
– Businesses publish information on their human rights initiatives and operations on the Business and Human Rights Resource Centre website (www.businesshumanrights.org).
– The Global Reporting Initiative (GRI) has published G4 guidelines for sustainability reporting (https://www.globalreporting.org/information/g4/Pages/default.aspx).
− Shift and Mazars have developed the UN Guiding Principles Reporting Framework for companies to report on human rights (http://www.ungpreporting.org/).
− The Danish Institute for Human Rights has developed a set of 1,000 Human Rights Indicators for Business (HRIB), enabling businesses and stakeholders to evaluate their human rights policies, procedures and practices (http://businesshumanrights.org/en/platform-for-human-rights-indicators-for-business-hrib).
1. The State Duty to Protect
1.2 Basic rule of economic policy
The current situation
Germany has ratified major strategic international instruments codifying the protection of human rights, including labour rights, thereby incorporating them into national law. The same applies to the particularly important ILO instruments known as the Core Labour Standards. The instruments that are now binding in Germany include, for example, the International Covenant on Civil and Political Rights, the UN Convention on the Rights of the Child, most of the conventions of the International Labour Organization and major European agreements such as the Convention for the Protection of Human Rights and Fundamental Freedoms and the European Social Charter.
People in vulnerable situations pose a particular challenge in Germany as elsewhere. These include migrants and, in general, employees in precarious work. These groups of people are exposed to a high risk of labour exploitation. The introduction of a general statutory minimum wage in Germany has established an effective instrument against excessively low wages. Since 1 January 2015, a minimum hourly wage of €8.50 has been payable, and its rate is to be adjusted every two years by an independent commission. The minimum wage has increased the earnings of four million people, whose income has risen by an average of 18%.
People who are affected by or at risk of labour exploitation need information about their rights and assistance in enforcing them. In recent years, advice and contact centres have been created in various parts of Germany, some with national and some with regional funding. With support from the Federal Government and the European Social Fund (ESF), for example, the German Trade Union Confederation (DGB), through a project called “Faire Mobilität” (fair mobility), provides such advice to employees, especially those from the EU Member States in Central and Eastern Europe. There is no permanent nationwide advisory structure yet for employees from all geographical origins and occupational sectors. In the fight against human trafficking and exploitative employment, Germany is also bound by EU Directive 2011/36/EU and has ratified both the Council of Europe Convention of 2005 on Action against Trafficking in Human Beings and the Palermo Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially Women and Children. To coordinate the diverse activities designed to combat human trafficking, the Federal Government established the Federal Working Group on Trafficking in Human Beings in 1997, whose members include representatives of non-governmental organisations.
The protection of whistleblowers is a highly valuable accompanying measure in the detection of exploitative employment. General provisions in the field of labour law (sections 612a and 626 of the German Civil Code and section 1 of the Protection against Unfair Dismissal Act) and in constitutional law (Articles 2(1), 5 and 20(3) of the Basic Law) provide the legal basis for such protection.
There are also numerous provisions of special legislation which supplement the protection of whistleblowers guaranteed by the aforementioned provisions in particular areas of activity, examples being section 13 of the Money Laundering Act and section 17(2) of the Occupational Health and Safety Act. The Federal Government is currently preparing for the incorporation of numerous international legal instruments into German law. These include the Protocol to the ILO Forced Labour Convention (No 29). The Federal Ministry of Labour and Social Affairs is planning the examination prior to ratification of the ILO Minimum Wage Fixing Convention (No 131) and Indigenous and Tribal Peoples Convention (No 169) as well as of the Optional Protocol of 2008 to the International Covenant on Economic, Social and Cultural Rights and the revised Social Charter.
- To supplement the existing structures, the Federal Government has shifted the focal point of its efforts towards the fight against human trafficking for the purpose of exploitative employment. A joint federal level-state level working group is currently developing a strategic approach designed to reinforce prevention, establish advisory structures and improve criminal prosecution and the data situation.
- The Federal Government has reached agreement on a bill designed to combat abuses of temporary agency work and work and services contracts. This means that there will be clear rules in future to prevent abuses and the circumvention of employment standards.
- As part of the transposition of European Directive 2016/943/EU on the protection of undisclosed know-how and business information (trade secrets), the protection of whistleblowers in German law is being further developed. The purpose of this legislation is to make it clear that the disclosure of trade secrets is lawful if its purpose is to expose professional or other misconduct or illegal activity in order to protect the general public interest.
The precept of equal rights for men and women is constitutionally enshrined as a fundamental right in Article 3(2) of the Basic Law. Participation by men and women on an equal footing at all levels is a top priority of the Federal Government. Since 1 May 2015, for example, the Act on the Equal Participation of Women and Men in Leadership Positions in the Private and the Public Sector has been in force. The aim of the Act is to increase significantly the percentage of women in executive positions in the medium term with a view to ultimately achieving parity with men. The principle of equal pay for equal work has also been firmly enshrined in the European treaties since the adoption of the Treaty of Rome.
In Germany there remains a substantial pay gap between women and men. Career choices based on role stereotypes, women in marginal part-time employment and disparities in career prospects because of structural conditions, the effects of material incentives and discrimination – mainly indirect – against women regarding remuneration are still preventing the realisation of equal pay for equal work. Even where men and women have the same formal qualifications and meet other criteria to the same extent, there is still a measurable pay gap of 7%. These pay differentials are a problem throughout the economy, a problem for which all relevant stakeholders must face up to their responsibility. The Federal Government has initiated a dialogue between employers’ and employees’ organisations on this issue and has introduced numerous non-legislative measures such as the Equal Pay Day and a new computer-assisted assessment procedure for the identification of corporate pay discrimination.
Development policy [page 19-20]
German development policy is value-based and is guided by the principle of human rights, because every individual worldwide must have fair development opportunities. Respecting, protecting and guaranteeing human rights are binding requirements and form a key component of the 2030 Agenda for Sustainable Development, which, in 2015, the international community resolved to implement. With its globally and universally applicable Sustainable Development Goals (SDGs), the 2030 Agenda serves as a compass and reference framework and has been in force since 1 January 2016. The 2030 Agenda underlines the aspiration of the Federal Government to combine economic development with sustainability, with the basic principles of social and green market economics and with decent working conditions.
Through its development policy, Germany works proactively at all levels – globally, in partnership with other countries and nationally – to ensure that human rights are upheld by fostering the creation of requisite legal and institutional conditions, pertinent state regulation, and the monitoring of corporate activity. To this end, assistance is given to governments of developing countries as well as to international and multilateral organisations, for example, in aligning their economic and social policies more closely with human rights and sustainability standards.
German development policy actively supports dialogue between governments and enterprises (and their associations), trade unions and civil society on subjects such as vocational training, health and safety at work and minimum wage rates in partner countries.
In addition, the Federal Government, directly or together with these partners, implements development projects or programmes that target greater respect for human rights and the reduction of risks to human rights. Other aims of German development policy are to strengthen the rule of law and to improve access to justice, especially for marginalised sections of the population in partner countries.
The current situation
Activities in the fields of development cooperation with the private sector and promotion of economic development are governed by the UN Guiding Principles. Back in 2011, the Principles were incorporated into the strategy paper of the Federal Ministry for Economic Cooperation and Development on human rights in German development policy. This strategy is binding on the organisations that implement public development policy on behalf of the Federal Government. Contractual obligations to this effect have also been incorporated into agreements on development partnerships with the German and European private sector under the develoPPP.de programme.
With their environmental and social standards, international financial institutions such as the World Bank and regional development banks set benchmarks for environmental and social regulation. The Federal Government will continue to track the reform processes in international financial institutions with a view to ensuring that their operations are even more sharply focused on human rights.
Seeking to identify practical approaches to development which will boost corporate responsibility for human rights, the Institute for Development and Peace (INEF) has implemented, on behalf of the Economic Cooperation and Development Ministry, a research programme entitled “Human Rights, Corporate Responsibility and Sustainable Development”. A research project sponsored by the same ministry at the German Institute for Human Rights, moreover, supports national human rights institutions in partner countries in the field of human rights and business.
In addition, 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.
- The instruments of development policy relating to cooperation with business will be reviewed for compliance with the requirements of the UN Guiding Principles. In particular, the contractual clauses of the develoPPP.de programme are to be fleshed out to include the due diligence requirements with regard to human rights.
- It is important to the Federal Government that National Action Plans on Business and Human Rights should be drawn up in developing and newly industrialised countries. The Federal Government will use the means at its disposal to promote such processes, for example by supporting national human rights institutions.
- The Federal Government will also take specific action to step up its wideranging commitment to the protection of human rights defenders when applying the UN Guiding Principles. In the field of business and human rights, as elsewhere, development policy is about standing up for the rights of vulnerable groups, such as indigenous peoples or children and youth or persons with disabilities.
- The requirements set out in the UN Guiding Principles and in the National Action Plan, inparticular in its chapter III, on due diligence with regard to human rights, also apply to the organisations that implement development policy, including bodies that provide financing for development. They also serve as a basis for further assessment and monitoring and, where appropriate, further development of the grievance procedures that state implementing organisations, including financing bodies, have already established.
- In addition, the Federal Government will continue to track the reform processes in international financial institutions with a view to ensuring that their operations are more sharply focused on human rights.
2. Challenges in corporate practice
2.1 Ensuring the protection of human rights in supply and value chains [pages 28-31]
The Federal Government has long been supporting multi-stakeholder initiatives that have been launched in various sectors for the purpose of devising strategies and monitoring procedures.
- These include, for example, the Sustainable Cocoa Forum, founded jointly by the Federal Ministry of Food and Agriculture, the Federal Ministry for Economic Cooperation and Development, the business community and civil society. In the Forum, the Federal Government, together with representatives of civil society, the confectionery industry and the food trade and in cooperation with partner countries, presses for improved production conditions and living standards in cocoagrowing areas and for sustainable cocoa farming.
- The Partnership for Sustainable Textiles, which was initiated by the Federal Ministry for Economic Cooperation and Development, has established an obligation to comply with sustainability standards and to guarantee corporate due diligence in the textile and clothing sector. All members of the Partnership are required to pursue its social and environmental objectives. They submit to a review process, which is conducted by an independent third party and is designed to bring about continuous improvement. Individual schedules of measures (road maps) are compiled annually by all members; the first of these is to be produced by the end of January 2017. A robust sanctions regime and regular reporting on the implementation of the road maps will ensure credibility and transparency. The Textile Partnership creates a reference framework and an independent review system of international scope.
- With support from the Federal Government-funded German Global Compact Network, the “Round Table on Human Rights in Tourism” was launched in 2012. Its aim is to specify the precise requirements of the UN Guiding Principles on Business and Human Rights for the tourism industry and to develop, in a multi-stakeholder format, solutions to human rights challenges that are specific to tourism.
- The Federal Government will support the systematic inclusion of sustainability chapters in free-trade agreements, which will prescribe, among other things, compliance with the ILO Core Labour Standards.
- The Federal Government will publish a study identifying high-risk sectors and regions of particular relevance to the supply and value chains of German business. On the basis of this study, with the Federal Government in a moderating role, sector-specific guides to the exercise of human rights due diligence and examples of best practice will be drawn up in cooperation with the relevant business associations and with the aid of dedicated multi-stakeholder forums.
- The Federal Government will continue to promote the Vision Zero Fund, which was initiated on the basis of a G7 decision. The Fund is to be administered by the International Labour Organization and will serve to prevent and reduce work-related deaths and serious work-related accidents in global supply chains.
- Through its development cooperation programme, Germany supports the application of sustainability standards in host countries, for example through the regional project entitled “Social and labour standards in the textile and garment sector in Asia”, which covers three countries – Bangladesh, Cambodia and Pakistan.
- By means of the Partnership for Sustainable Textiles, the Federal Government supports a multi-stakeholder initiative combining voluntary and compulsory elements. The Textile Partnership is designed to comply with the UN Guiding Principles. The aim is to have 75% of the German textile and clothing market signed up to the Textile Partnership by 2018. The Partnership should serve as a model for the definition of due diligence requirements in other industries.
- The “Round Table on Human Rights in Tourism”, a model initiative for the development of a specific sectoral understanding of due diligence with regard to human rights, will receive increased financial support from the Federal Government.
2.2 Transparency and communication regarding corporate impacts on human rights
The number of enterprises that already present regular sustainability reports on a voluntary basis is steadily increasing. For example, the participants in the Global Compact, more than 300 in number, have committed themselves to presenting annual reports. The reports from German enterprises, and particularly from the large enterprises, are mostly based on the voluntary standards of the Global Reporting Initiative
(GRI). The Federal Government has also supported the development of a German reporting standard in the German Sustainability Code (DNK). Sponsored by the Federal Ministry of Labour and Social Affairs, the Institute for Ecological Economy
Research (IÖW) assesses the quality of sustainability reports from large enterprises and SMEs and draws up a league table for each of these categories. This ranking is intended to stimulate corporate competition in the realm of sustainability reporting and to highlight and propagate benchmarks for high-quality reporting.
Through their purchasing decisions, consumers influence the supply of sustainably produced and delivered goods and services. Instruments such as the information platform www.siegelklarheit.de (sustainability standards comparison tool), initiated by the Federal Government, create transparency and help consumers to adopt sustainable purchasing habits.
- On 21 September 2016, the Federal Cabinet adopted the law transposing into German law 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 information by certain large undertakings and groups (the CSR Directive).
- The Federal Government is considering the introduction of a certification mark into German law. The relevant EU legislation already provides for the introduction of a European certification mark and gives Member States the option of introducing a national certification mark in addition. Such a mark could be used, for example, to certify compliance with certain human rights standards in supply and value chains. Responsibility for verification would rest with the certifying body. The mark can contribute to greater transparency for consumers and create positive incentives for enterprises in the form of a competitive edge derived from this means of communicating their compliance with human rights standards in the marketplace.
3. Available means of practical implementation support
The current situation
Numerous measures and services are already available for this purpose. A selection of existing and planned measures is described in some detail below:
- The National CSR Forum, which was launched by the Federal Ministry of Labour and Social Affairs in 2009, consists of currently 41 members – high-ranking experts from business, trade unions, non-governmental organisations and research bodies as well as representatives of the participating federal ministries. Among the main tasks of the National CSR Forum are the provision of advice to the Federal Government on the continuing development of the national CSR strategy and Page 34 the formulation of recommendations on specific issues. In 2010, the National CSR Forum, with the Federal Ministry of Labour and Social Affairs in the lead role, discussed and developed a National CSR Action Plan. The measures and activities that have been carried out in the framework of the Action Plan have reached numerous enterprises. In a decision taken on 30 August 2012, the National CSR Forum expressed its support for “a smart mix of voluntary policy measures and, where necessary, complementary regulation” (2012, p. 11). Through the ESF promotion scheme for “social responsibility in SMEs”, more than 3,000 SMEs received advice and training in social responsibility, and regional CSR networks have been made permanent. Numerous specialised events have been staged in the framework of the CSR Forum to advise enterprises on the exercise of due diligence.
- The Federal Ministry for Economic Cooperation and Development makes information and guidance available to enterprises of various sizes from various sectors, particularly by funding the work of the German Global Compact Network. Ever since 2004, the Ministry has been promoting the Network in close consultation with the Federal Foreign Office. The Network unites the German signatories of the UN Global Compact, whose core principles include respect for fundamental human rights and labour standards. As a business-driven multi-stakeholder forum, the Network has been providing training courses for management staff in the exercise of corporate responsibility for human rights ever since 2008.
- The Agency for Business and Economic Development of the Federal Ministry for Economic Cooperation and Development was expanded in 2015/2016 and provides advice on development-related support opportunities and information services for enterprises operating in developing and newly industrialised countries. In addition, ever since 2009 the ILO has been offering the services of a help desk to assist multinational companies in the practices of applying international labour standards and to advise them on the current legal situation in individual countries.
- Ever since 2012, the Federal Government has been supporting the Business and Human Rights Resource Centre information platform. In 2014, it succeeded in having a German-language version of the platform made available. The website provides information on human rights challenges by region, issue and risk group and even by enterprise.
- The Chambers of Industry and Commerce are already very active in providing enterprises with guidance. German Chambers of Commerce Abroad can inform enterprises of the current legal and de facto situation in foreign countries. In some countries, the Chambers, in cooperation with German development cooperation agencies, provide facilities known as “CSR centres of excellence”, which provide advice on CSR measures.
I. Helpdesk and initial consultation
- The Federal Government will significantly increase the reporting and consultation output of German diplomatic and consular missions in collaboration with the other pillars of external-trade promotion, namely the Chambers of Commerce Abroad and Germany Trade and Invest. To this end, basic and continuing training will also be focused more sharply on advisory skills in the field of business and human rights.
- Within the Agency for Business and Economic Development of the Federal Ministry for Economic Cooperation and Development, which operates as a one-stop business advisory centre on development-related support opportunities in developing and newly industrialised countries, a helpdesk on business and human rights will be created. The core task of the helpdesk will be to provide initial consultation on request or referral and to raise awareness of the issues involved. The Agency serves enterprises and business organisations as a first stop, informing them of existing services, contacts and networks. The services of the Agency are broadened and underpinned by the provision of advice in the framework of existing networks operating at the interface between business and development cooperation, such as “EZ-Scouts” and “ExperTS”.
II.Information services and best practices
- The Federal Government CSR Award recognises exemplary enterprises for their contributions to sustainability. It also promotes a learning process, since each enterprise is scored on the basis of its individual contribution to sustainability. An additional special prize is to be awarded in future for responsible supply chain management.
- The website www.csr-in-deutschland.de is currently being developed into the central Federal Government gateway to content on corporate social responsibility. Information on the main activities and measures of the Federal Government is to be posted there in a coherent whole-of-government format.
- Continued efforts will be made to increase the availability of information in German through the production of guides and through support for the Business and Human Rights Resource Centre.
III. Opportunities for training and dialogue
- The range of advisory and training services offered by the German Global Compact Network will be expanded and supplemented by services such as a graduated range of webinars and other formats relating to specific elements of human rights due diligence just like practical questions and answers.
- As the third-largest contributor to the International Labour Organization, the Federal Government is a major sponsor of the support services offered by the ILO. The ILO Helpdesk for Business on International Labour Standards assists enterprises in applying international labour and social standards correctly. Besides an informative website, the Helpdesk also provides prompt replies to individual queries on a confidential basis as well as training courses.
- In cooperation with business networks, ‘practice days’ for SMEs are offered nationwide. These sessions provide support, information and exchanges with other enterprises on responsible supply chain management and high-quality sustainability reporting.
IV. Creating a global playing field
- In multilateral forums such as the G20, the EU and ASEM and in close cooperation with international organisations such as the ILO, the OECD and the UN, the Federal Government will press for the creation of a global level playing field with regard to terms of competition. To this end, the G7 leaders decision on sustainable supply chains will be further fleshed out with a view to arriving at a common global understanding of due diligence and of sustainable supply chain management.
Section 2. Current legislative and regulatory framework [pages 13-15]
Business and human rights touch on the policy areas of most government departments. There is a commitment across the whole of government to recognise and meet our commitments to ensure responsible and competitive business practice both in Ireland and internationally.
Internationally, Ireland is held in high regard as a strong and active partner in defending and promoting human rights. In terms of promoting business and human rights, we have taken a forward role at both UN and EU level and we are among the first group of EU member states to put in place a National Plan. Throughout the term of this Plan, we will continue to engage with our EU partners to promote consideration of business and human rights in EU decision-making. We will also continue to be an active partner at the UN level, including through annual participation in the UN Forum on Business and Human Rights in Geneva.
Ireland is strongly committed to the protection and promotion of both domestic and migrant workers’ rights through national and international legislation, with a robust body of employment rights legislation which provides employees with a means for redress in cases where their employment rights have been breached. In 2017, Ireland has taken up, for the first time, a titulaire seat on the governing Body of the International Labour Organization (ILO). During its term, Ireland will maintain and promote its commitment to human rights and will work to enhance the profile of business and human rights in the framework of the ILO.
In recent years, united Nations and regional organisations have increasingly recognised the negative impacts of corruption on the enjoyment of human rights. Moreover, the treaty bodies and special procedures of the united Nations human rights system have regularly identified corruption as a critical factor contributing to the failure of states to satisfy their human rights obligations. The most recent peer review of Ireland’s implementation of the OECD anti-Bribery Convention made a number of specific recommendations around awareness raising and reporting. Since that report, the government has introduced the Protected disclosures act 2014, which provides a robust statutory framework within which workers can raise concerns regarding potential wrongdoing in the workplace. Ireland will continue to follow up the recommendations of the report to ensure that we fulfill our Convention commitments.
The government is committed to promoting equality in all aspects of Irish society. The statutory-based Irish Human Rights and Equality Commission works towards the elimination of discrimination and the promotion of equal opportunities. It is tasked with providing information and advice to persons who consider themselves discriminated against on any of the nine grounds in employment or non-employment situations. Recent positive developments on equality issues include the introduction of statutory paternity benefit in 2016 and the launch of a new National strategy for Women and girls in may 2017. Work is also progressing on a new equality/disability (miscellaneous Provisions) Bill. Ireland has been elected, for the first time, to serve on the united Nations Commission on the status of Women for the term 2017-21. This will provide an opportunity to build on Ireland’s international engagement on the full realisation of the rights of women and girls. The government has pledged to work to strengthen the voice and functioning of the Commission and to promote the participation of civil society in its work. Anti-trafficking Combatting human trafficking is an important and fundamental part of the business and human rights agenda. The government is committed to ensuring that people are not exploited or forced to work against their will either in Ireland or by Irish companies operating overseas. In October 2016, the government launched the second National action Plan to Prevent and Combat Human trafficking. The plan contains 65 actions designed to crackdown on individuals and gangs involved in the crime, to support victims, to raise public awareness, and to enhance training for those likely to encounter victims.
The office of the data Protection Commissioner (DPC) is responsible for upholding the general principle that individuals should be in a position to control how data relating to them is used. The Commissioner is also responsible for enforcing obligations upon data controllers. Owing to the significant number of multinational tech companies based in Ireland, Ireland’s data Protection Commissioner has responsibility for oversight of a large amount of data and has been involved in some high profile cases. The government is committed to supporting the data Commissioner in their role and, over recent years, has provided a fourfold increase in the funding for the work of the Commission.
The government prioritises the right of citizens to enjoy a safe environment and the responsibility of businesses to comply with environmental protection legislation. Ireland has transposed key EU directives, such as EU Directive 2004/35/EC which deals with environmental liability with regard to the prevention and remedying of environmental damage. Consistent with the government’s priority of ensuring inclusive and open participation in policy making, Ireland has also ratified the Aarhus Convention, which is designed to promote the involvement of citizens in environmental matters and improve enforcement of environmental law.
Exploitation or corruption along the supply chain can have major negative reputational impacts for companies and states. The government supports the proposal by the European Commission for an EU Council Regulation which provides for the establishment of an EU-wide system for supply chain due diligence of responsible importers of tin, tantalum and tungsten, their ores, and gold originating in conflict-affected and high-risk areas. The main objective of this proposal is to help reduce the financing of armed groups and security forces through mineral proceeds in conflict-affected and high-risk areas by supporting and further promoting responsible sourcing practices of EU companies. Of course, supply chain diligence is not limited to the extractive industries and areas of conflict. Irish expertise has also been commissioned by multi-national corporations and technical cooperation programmes to undertake third party audits in the context of supply chain due diligence on factory standards. The design and implementation of a long-term building inspection and enforcement regime for all buildings in Bangladesh has, for example, been greatly assisted by Irish engineering expertise. Where possible, including through our overseas development assistance, the government will look to support such initiatives.
Public procurement in Ireland is governed by EU and national law and national guidelines. The office of government Procurement is committed to ensuring that human rights related matters are reflected in public procurement and embedded in national public procurement policy. The EU treaty principles of equal treatment and non-discrimination, transparency, mutual recognition, proportionality, free movement of goods and services and the right of establishment must be observed in all tenders. Most recently, the 2014 EU directives on Public Procurement, which have been transposed into Irish law contain specific provisions excluding tenderers who are guilty of certain human rights infringements from participation in public procurement. Extensive general guidance on legal procurement requirements is available to public authorities on the Irish portal for public procurement.
The EU directive on disclosure of non-financial and diversity information (2014/95/EU) 9 entered into force in December 2014. It requires certain companies known as ‘public interest entities’ to include a declaration in their annual management report containing information stating material data related to the environment, social affairs, human rights, and prevention of corruption. This directive will shortly be transposed into Irish law.
Section 3. Actions
II. Initial priorities for the Business and Human Rights Implementation Group
The State Duty to Protect Human Rights [page 18]
- Develop a practical toolkit on business and human rights for public and private entities within 12 months to assist them in their human rights due diligence.
- Ensure that relevant public servants are made aware of their obligation to report suspected cases of bribery under the OECD Convention on Foreign Bribery.
- Provide clarity to relevant stakeholders on the applicable Irish law, reporting channels and protections for whistle-blowers/protected disclosures.
The Corporate Responsibility to Respect Human Rights [page 19]
- Encourage business representative bodies to provide examples, templates and case studies to help support companies in their efforts to develop human rights focused policies and reporting initiatives.
- Create a fact sheet on the OECD anti-Bribery Convention, the criminal offences in Irish law on bribery, the reporting systems in place for reporting suspicions of foreign corruption and the protections provided by the Protected disclosures act to be distributed by enterprise Ireland to all Irish companies engaged in trade missions
- Encourage companies and NGOs funded by the state to carry out human rights due diligence as appropriate to their size, the nature and context of operations and the severity of the risk of adverse human rights impacts.
- Encourage and facilitate the sharing of best practice on human rights due diligence, including effective supply chain audits.
Annex 1 – list of additional and ongoing actions to be carried out across government
Domestic Framework [page 20]
- Transpose the EU directive on disclosure of Non-financial and diversity information (2014/95/EU) into Irish law.
Enact the mediation Bill.
Development Cooperation [page 21]
Promote the inclusive economic growth policy priority set out in “one World, one Future: Ireland’s Policy for international development”, by encouraging and supporting partner governments to ensure that business and economic regulation and legislation implements national and international commitments to human rights such as those relating to gender equality – in particular promoting women’s access to formal employment, decent work, and the rights of marginalised groups.
IV. Government responses
Current Activities and Future Commitments [page 13]
A. Foundational Principles
Guiding Principle 3:
The Italian Government is strongly committed to the protection of human rights and to prevent and redress abuses committed by companies and therefore: i) takes appropriate steps to boost and facilitate the enforcement of laws aimed at requiring the respect of human rights by business; ii) provides effective guidance to business through policy measures and promotion and participation to multi-stakeholder initiatives; iii) encourages enterprises to communicate how they address their human rights impacts and stimulate and disseminate best practices at national and international level.
Recent policies, legislative initiatives and implementation measures adopted by the Government include:
– Legality Rating
The ‘legality rating’ was introduced in 2012 for the promotion of principles of ethical behaviour in business. The Italian Competition Authority (ICA) can issue, on request, a certification of compliance with relevant domestic legislation and of the adoption of good governance initiatives voluntarily adopted by enterprises, which entitles firms to access public funding and easier access to bank credit. One of the main aims of the ‘legality rating’ is to certify the companies’ active compliance with human rights, in particular the adherence to the guidelines provided by the Legislative Decree No. 231 of June 8th 2001 on the administrative liabilities of companies and the adoption of corporate social responsibility within their own modus operandi. The Decree No. 231 introduces essential provisions regulating the relationship between companies and the stakeholders, sanctioning enterprises that through their managers, company’s officers, subordinates (or third parties acting on behalf of the company), commit specific offences, including environmental crimes, unauthorized handling of information and crimes against the person (as listed in the Universal Declaration of Human Rights), and violate the safety rules in the workplace. The complete list of the companies that have obtained a rating, with their score, is published on the ICA website (www.agcm.it/rating-di-legalita/elenco.html);
– The Administrative Liability of Entities
Decree 231 of 2001 has introduced the direct liability of legal entities for specific offences (corruption, money laundering, bribery, fraud, etc.) providing for a special form of liability, which is administrative in nature but to be ascertained by a penal judge and according to criminal law procedures. In order to avoid incurring in liability, the entity shall first demonstrate that it has adopted a sound model of organization, management and control; and secondly, that it has established a mechanism/body entrusted with monitoring and supervising the compliance to the model. Law 231 is both preventive and punitive: the list of crimes falling under the application of the law has been extended over the time and it presently includes specific human rights abuses, among others, the practice of mutilation of female genitalia; child prostitution and pornography; trafficking in human beings and slavery. In 2015, new environmental crimes have been included (environmental disaster, environmental pollution, failure to decontaminate, etc.).
– Irregular work and Agricultural sector
The ‘National Action Plan Against Trafficking in and Serious Exploitation of Human Beings’ provides for preventive measures in countries of origin where exploitation and trafficking of migrants in irregular work mostly occurred. Within this framework, a 2014 Decree has established the “Rete del Lavoro Agricolo di Qualità”: a network aimed at countering irregular work in agriculture by connecting companies compliant with specific requirements under labour, social security and fiscal law (such as the application of local and national agricultural sector work agreements). Companies compliant with the requirements under labour, social security and fiscal law may apply for joining the network, and this is rewarded with special incentives. Companies listed in the network receive special benefits, such as being included in a “white list”. This list is taken in consideration by the government enforcement agencies, which prioritize their controls over companies not belonging to the network (the rule does not apply if workers or trade unions representatives ask for intervention or in case of complaints to judicial authority or other administrative authorities). Such reward mechanisms from Public Administration incentivize promising and best practices in the field of countering irregular work in the agricultural sector.
In line with this approach, the Law n. 199 of 29.10.2016 “Disposizioni in materia di contrasto ai fenomeni del lavoro nero, dello sfruttamento del lavoro in agricoltura e di riallineamento retributivo nel settore agricolo” (provisions on countering undeclared labour, labour exploitation in agriculture and wages rebalance in agricultural sector), provides for measures aimed at improving the criminal prosecution of the phenomenon (through the crimes of illicit intermediation and work exploitation) with particular regard to illicit capital accumulation by exploiters and the provision of confiscation of the goods and properties acquired through the exploitation activity. The Law provides for victims’ compensation and the activation of a plan for the treatment of seasonal workers (in particular foreign ones) with the direct involvement and control of Regions on their conditions. The Law is also aimed at controlling the illicit intermediation by favouring the meeting supply and demand of jobs. On this issue a working group (composed of Ministry of Agricultural, Food and Forestry Policies; the Ministry of Labour and Social Policies; the Ministry of Justice; Regions; Industry Associations; Trade Unions and Civil Society Organizations) signed the experimental Protocol “Contro il caporalato e lo sfruttamento lavorativo in agricoltura. Cura-Legalità-Uscita dal ghetto”
In line with the goal of countering exploitation in the agricultural sector, the Centre of Politics and Bio economy of CREA (former INEA) within the Ministry of Agricultural, Food and Forestry Policies, and within the National Operational Project “Sicurezza per lo Sviluppo” (Safety for Development), has set up an Immigrants database with the aim of improving monitoring and control activities especially with regard to immigrants and workers recruited through racket and criminality. The tool collects data geographically (33 specific agricultural areas in about 270 municipalities for a total number of 26 productive divisions employing immigrant workers) and by monitoring seasonal work demands, and consequently identifies the manpower needed over the year.
– Migrants Smuggling and Human Trafficking
To increase cooperation activities of investigation, intensify financial controls on criminal groups’ profits and ensure punishment for transnational organizations profiting on migrants smuggling and human trafficking, in line with the Legislative Decree 24 of 2014 (transposing the EU Directive 2011/36) on February 2016, the Italian Government has adopted the National Action Plan Against Trafficking in and Serious Exploitation of Human Beings. The Plan is aimed at defining measures and strategies of intervention for the countering and prevention of trafficking, as well as at providing for actions of awareness-raising, social prevention, and social integration of victims.
– Development Cooperation
International Development Cooperation represents for Italy an instrument for creating stable relationships between countries and also a means of human rights and solidarity promotion; in this respect, the “General Rules Governing International Development Cooperation” define a ‘governance architecture’ for the development cooperation system, whose coherence and policy coordination will be ensured by the Inter-ministerial Committee on Development Cooperation (CICS), a task force made up of relevant ministries. The National Council for Development Cooperation has also been established, including the main public and private, profit and non-profit actors in the field of international development cooperation.
- Conduct a comprehensive study of the Law 231/2001 in order to evaluate potential extension of the scope and application of the administrative liability of legal entities;
- Strengthen the role of the legality rating – primary competence of the Italian Competition Authority – with the aim of taking it into consideration in the elaboration of the ‘rating d’impresa’- primary competence of the National Anticorruption Authority – with the aim of promoting the respect for human rights in all economic activities;
- Extend the scope and mandate of the “Rete Lavoro Agricolo di Qualità” to the food mass distribution companies and intermediaries with the aim of promoting the social responsibility of agro-food industry for workers’ exploitation;
- Strengthen the role of labour inspections for tackling and controlling the emersion of irregular work and caporalato;
- Promote the realization of interventions on immigrants’ rights protection in line with the project “villaggio solidale” (as developed in Puglia Region and coordinated by Coldiretti and Focsiv) that has led to the conclusion of regular employment contracts between agriculture industries and immigrants workers in the harvest seasons;
- Further develop coordinating measures in the activities of prevention and control of irregular work and extend the scope and potential of the network of the “Rete Agricola di Qualità” in line with legislation that introduces the administrative liability for work exploitation and illegal intermediation and extends the availability of the compensation fund for victims of trafficking also to victims of caporalato;
- Implement the provisions included in the draft of the II Program of Action on Disability – currently under approval – with particular focus to line of intervention n. 5 “Labour and occupation” and to the dispositions concerning the definition of supporting measures and of a system of incentives for the I and II level collective negotiations on matters of flexibility, part-time and treatment-work-life balance for persons with disabilities or affected by chronic disease or for caregiver workers for persons with serious disabilities;
- Strengthen – also in line with the implementation of art. 25 of the UN Convention of Rights of people with disabilities – respect of fundamental rights of people with disabilities with regard access to medical treatment in hospitals and their quality, through the promotion and dissemination of the “Carta dei diritti delle persone con disabilità in ospedale” realized by the Coop. Sociale Onlus Spes contra Spem in 2010;
- Promote effective implementation of EU Directive 2014/95 on disclosure of non-financial and diversity information by large enterprises and groups;
- Fully implement the provisions of the new Law on Italian Development Cooperation with particular focus on the relationship between the profit and no profit actors and the definition of specific binding guidelines clarifying the role of business and private sector within development cooperation activities and their compliance with human rights;
- Ensuring the full implementation of Law 221/2015 on green economy, including in particular the elaboration of a ‘Green Act’, a reviewed ‘National Sustainable Development Strategy’, a ‘National Plan on Sustainable Consumption and Production’ and the establishment of a ‘Committee on Natural Capital’ to promote environmental sustainability and foster investments in the green economy; these measures will be developed taking into due consideration the development of the relevant European Union frameworks such as the Climate-energy Package 2030 and the Circular Economy Package as well as according to Agenda 2030 and the Paris Agreement;
- Proceed to ratification of the 2014 Protocol to the ILO Forced Labour Convention and its implementation to counter activities of work exploitation and slavery;
- Promote an effective implementation of the Recommendation CM/Rec(2016)3 adopted by the Committee of Ministers of the Council of Europe to Member States on business and human rights.
Planned Measures [pages 17-20]
- Conduct a systematic review of the existing legal framework for contrasting all illegal forms of labour and labour exploitation in the agriculture, construction, manufacturing and services sectors;
- Conduct a comprehensive review of the existing commercial and civil law to assess and evaluate legislative reform introducing provisions such as the ‘duty of care’ or due diligence for companies;
- Strengthen a comprehensive approach with the participation of all the law enforcement agencies concerned with the aim of better develop a strategy that – by using the operative instruments available – could effectively counter economic and productive activities abusive of human rights;
GP 3 (c,d)
The Italian Government has reaffirmed its on-going commitment to foster business respect for human rights through activities of promotion and improvement of responsible business conduct in the following fields:
In the field of environment protection, the promotion of high environmental standards by enterprises beyond National and EU legislation is an essential contribution to the respect, promotion and fulfilment of human rights. Particularly relevant in this context are initiatives relating to green economy taken by the Government (Ministry of Environment and Ministry of Economic Development) in partnership with relevant stakeholders (such as national research centres, universities, business enterprises and environmental associations at national and international level) and other international actions undertaken in the field of countering climate change.
– Children Right
With regard to children, the Ministries for Economic Development and Foreign Affairs and International Cooperation supported the launch in June 2015 of the UNICEF Business Lab Project. The project is aimed at helping companies identify risks and integrate children rights in their own due diligence and management practices. In line with this approach several actions have been foreseen such as the dissemination of the UNICEF workbook on direct and indirect impact of business activities on children under 18 (Children are everyone’s business) as well as other relevant publications (Children’s Rights in National Action Plans on Business and Human Rights, 2015; Children’s Rights in Sustainability Reporting, 2013; Children’s Rights in Impact Assessment, 2013).
– Responsible Business Conduct and OECD Due Diligence Practices
With reference to the promotion of responsible business conduct, the Italian OECD NCP4 is committed to implement the OECD Guidelines for Multinational Enterprises by promoting them through an in-depth dialogue with businesses, trade unions, non-governmental organizations, representatives of civil society.
Since the 2011 review of the OECD Guidelines, the NCP developed tools to make international standards operational especially for SMEs such as the “Due Diligence Guidance for SMEs”5 and activities for awareness raising and pilot projects involving large companies and SMEs with the aim of spurring a proactive responsible supply chain management through training, information and assistance.
Sustainable supply chain is indeed one of the main focus of the NCP action. In 2013, following the Rana Plaza collapse, the “Action Plan for Bangladesh” was launched with the involvement of Italian enterprises in the sector operating in Bangladesh. In this process, the NCP issued the “Report on responsible business conduct in the textile and garment supply chain. Recommendations of the Italian NCP on implementation of the OECD Guidelines for Multinational Enterprises”. Specific recommendations were given with regards to the adherence to the “Accord on Fire and Building Safety” and the participation to the “Rana Plaza Trust Fund” and for future action.
In this respect, the Italian Ministry for Economic Development, together with other six Ministers of EU Countries, signed the “Statement” recommending global companies to contribute generously to the Rana Plaza Donors Trust Fund, set up to compensate victims of the accident in Bangladesh. The Bangladesh case showed the need to switch from a reactive approach to a preventive approach and in this view multi-stakeholders and collective actions are favoured and supported as they are seen more effective to tackle system issues.
Such activities at national level are accompanied by active participation to the OECD proactive Agenda projects, such as the “OECD Sector Project on Responsible Supply Chains in the Textile and Garment Sector” and other EU and international initiatives. Other OECD guidance for due diligence are promoted among companies such as the “OECD-FAO Guidance for Responsible Agricultural Supply Chain” and the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-affected and High-Risk Areas. The NCP also takes direct action, cooperating with national and international organisations such as ILO and UNICEF.
– Training on Human Rights Compliance
With regard to communication, training and information on human rights compliance two projects are worth mentioning:
S.O.F.I.I.A.: developed by the Ministry of Agricultural, Food and Forestry Policies, it is aimed at increasing occupational level and fostering inclusion of young citizens of third countries in the job market through support (development and implementation of business plans) and training activities (access to public funding and information, economic and financial management, work health and safety) promoting entrepreneurship in agricultural sector;
AFORIL: provides for training activities for non-EU citizens in their countries of origin in view of their subsequent work inclusion in the Italian agroindustry.
- Providing guidance to Italian enterprises abroad through the diplomatic and consular network for the dissemination of UNGPs and the SDGs; the Ministry of Foreign Affairs and International Cooperation will develop a strategy to implement this process along actions of advocacy, watchdog activities and match making among enterprises;
- Support and promote the initiatives adopted by the enterprises associations on human rights, such as the recent European project “Global Industrial Relations, Transnational Company Agreements and Corporate Social Responsibility” led by Confindustria, jointly with the German and French business confederations and the Training Centre of the ILO in Turin. The project, that deals with the respect for human rights at global level, focuses on the available instrument for enterprises for a sustainable management of the global supply chain;
- Help disseminating respect of the UNGPs to enterprises investing abroad through an information toolkit for the diplomatic and consular network;
- Support the National Dialogue on Sustainable Finance led by the UNEP Inquiry with the Ministry of Environment, and involving major banks, insurances and institutional investors as well as their associations and policy makers;
- Promote environmental accounting in sustainability reporting and encouraging the adoption of disclosure processes for the assessment and communication of the environmental and carbon footprint of business;
- Strengthen human rights protection and promotion of low-carbon, ecologically sound technologies through climate change international cooperation in line with the OECD Guidelines, the BHR Framework and the Agenda 2030 on Sustainable Development;
- Foster, in cooperation with relevant business association and chambers of commerce, human rights respect among SMEs through the dissemination of toolkits of self-assessment;
- Promote, in line with the G7 Declaration on “Action for Fair Production” and with the involvement of social partners/trade unions, the contribution to the Vision Zero Fund with the aim of integrating the ILO norms on this matter among the fundamental standards;
- Reaffirm the priority of the elimination of every form of child labour in Italy and with reference to the economic activities of Italian enterprises abroad as provided by the ILO Conventions on this matter; to this purpose, encourage the dissemination among companies of the Italian UNICEF Committee Initiative ‘Business Lab’ aimed at raising the awareness on business impacts on children’s rights and on the need for the inclusion of adequate remedy and mitigation measures;
- Encourage companies in the dissemination of anti-discrimination culture by: i) promoting corporate policies and best practices on inclusivity and Diversity Management also via the institutional support to the adhesion, implementation and assessment of the Carta per le Pari Opportunità e l’Uguaglianza sul Lavoro (corporate voluntary initiative launched by Assolombarda in 2009 – which participates in the European Diversity Charter Platform promoted by the EU Commission GD Justice – with the aim of disseminating in Member States a movement to tackle prejudices and enhance talents in diversity); ii) promoting bodies (such as the Osservatorio Aziendale and the Disability Manager) that will have the aim of promoting the inclusion of workers with disabilities within the workplace, as foreseen in the draft of the II Program of Action on Disability; iii) increasing the awareness within the workplace on the serious issue of sexual abuse and domestic violence; iv) providing incentives for corporate training on inclusion, diversity management, gender balance and gender mainstreaming with specific focus on women empowerment and LGBTI rights.
With specific regard to the “OECD Guidelines for Multinational Enterprises”, the Government is committed to:
- Implement the OECD Guidelines for Multinational Enterprises promoting them among businesses with a focus on the HRs dimension, through an in depth dialogue with businesses, trade unions, non-governmental organizations, representatives of civil society;
- Promote common understanding of due diligence among companies and strongly encourage companies to engage in human rights policy and due diligence processes involving the entire supply chain;
- Engage directly with business associations, business and business leaders to convey the governments’ expectations on HRs protections;
- Produce effective guidance for companies (with special focus on SMEs) including at sector level and disseminate Guidance tools developed by the OECD, EU and other international organisations;
- Promote and encourage leading multi-stakeholder initiatives involving both big companies and SMEs for exchange and common action on BHR;
- Promote the international framework agreements developed by the International Trade Unions;
- Promote the culture of Human Rights protection in business action through analysis, cooperation with universities, training activities, etc;
- Participate to initiatives in the context of OECD, EU and other international for a on sustainable supply chains, human rights and due diligence.
II. Objectives and Measures
Objective 1: ensuring State’s duty to protect, defend and respect human rights
A. Legislative measures [pages 1-2]
1. Improvement of the legislative process. The aim is to review legal acts regulating law making, including also, if necessary, drafting of required new legal acts, as well as to ensure dissemination of best practice as regards application of the principles of transparency and openness in law-making Law on Legislative Framework of the Republic of Lithuania was adopted on 18 September 2012, and carne into force on 1 January Following the principles of openness and transparency, it provides for law-making to be made public, as general interest-related legislative decisions cannot be made without public awareness and without the possibilities to participate; the public must have access to information related to the national policy objectives, the need for legal regulation and participating bodies; the civil society and interest groups must be provided with a possibility to submit proposals for legal regulation at all the stages of law-making. It also provides for the right to know the bodies that were involved in submitting, drafting and assessing regulatory impact of a respective legislative proposal, and the bodies monitoring legal regulation.
2. Reforming legal regulation regarding administrative 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
C. Measures related to research and training on non-discrimination and other human rights.
1. Research and training in non-discrimination. The lnter-institutional Action Plan for the Promotion of Non-discrimination for 2012-2014 was approved by Resolution No 1281 of the Government of the Republic of Lithuania of 2 November 2011, aims to ensure the implementation of educational measures on promotion of non-discrimination and equal opportunities, to increase !legal awareness, mutual understanding and tolerance in terms of gender, race, nationality, language, origin, social status, belief, convictions or views, age, sexual orientation, disability, ethnic origin and religion, to inform the public about manifestations of discrimination in Lithuania and its negative impact on equal opportunities of certain social groups to actively participate in public.
- to conduct a study into the reasons for changes in societal attitudes and causes of discrimination, as well as the analysis of the results ;
- to organise seminars, informal education training and discussions on the topics of equal opportunities and non-discrimination for civil servants, trade union representatives and other target groups; in light of the priorities for 2012 as the European Year for Active Ageing and Solidarity between Generations, announced by the European Commission (hereinafter referred to as the EC), to organise informational and qualification advancement seminars and other events on manifestations of discrimination and other human rights issues.
It should be noted that under the Programme of the Government for 2012-2016, a working group was set up for drafting an Inter-Institutional Action Plan for the Promotion of Nondiscrimination for 2015-2017.
2. Promotion of employment of persons with disabilities. The National Programme on Social Integration for Persons with Disabilities for 2013-2019, approved by Resolution No 1408 of the Government of the Republic of Lithuania of 21 November 2012, aims to create a harmonious environment for the effective development and social integration of persons with disabilities in Lithuania and to ensure the implementation of national legislation relating to the social integration of persons with disabilities and their equal opportunities, and of the provisions of the Convention on the Rights of Persons with
- To organise training of the employers with a view to encourage their social responsibility as regards employment of persons with disabilities.
D. Measures related to research and training on equality between men and women
1.Research and training on equal opportunities between men and women. National Programme on Equal Opportunities for Women and Men for 2010-2014, approved by Resolution No 530 of the Government of the Republic of Lithuania of 4 May 2010 and the Action Plan for the implementation of the National Programme on Equal Opportunities for Women and Men for 2010-2014, adopted by Order No A l -323 of the Minister of Social Security and Labour of 7 July 20 IO, aims to ensure consistent, comprehensive and systematic cross-field implementation of the provisions of the Law on Equal Opportunities for Women and Men, as well as European Union (hereinafter referred to as the EU) and international commitments regarding gender
- to conduct an extended study and evaluation of the development as regards treatment of women and men in all spheres;
- to organise seminars to encourage employers to systematically promote equal treatment of women and men in the workplace and equal opportunities for women and men as regards access to employment or promotion to a senior position;
- to organise a round table discussion on the role of social partners in the implementation of equal opportunities for women and men in the labour market;
- to organise seminars on discriminatory treatment of women and men in education;
- to organise seminars in all regions of Lithuania on the implementation of provisional special measures;
- to organise a competition for employers ensuring equal treatment for men and ”
E. Measures related to international obligations
Accession to the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. The aim is to create conditions for the ratification of the Convention following Lithuania’s accession to the OECD. To successfully accede to this Convention, criminal legislation must contain a special rule providing for the liability of natural and legal persons for the bribery of foreign public officials in international business transactions. The legislation must also prohibit tax deductions from money obtained as bribes, irrespective of this money being accounted for in accordance with applicable legal requirements.”
F. Measures related to cooperation with non-governmental human rights organisations
1.Cooperation and financial support of non-governmental human rights organisations. The aim is to make a financial contribution to the activities of non-governmental human rights organisations.
Non-governmental human rights organisations are annually invited to participate in a competition for partial funding of their activities.
Objective 2: promoting corporate responsibility and respect in the field of business and human rights [pages 5-6]
The Government formulates and implements public policies mindful of the principle of responsible business and corporate social responsibility (hereafter referred to as the CSR) is an essential condition for sustainable development. Therefore, in its efforts to increase economic competitiveness, the Government not only promotes the use of renewable and environment friendly technologies that are best fit to meet long-term public needs, but also the development of socially responsible and human rights-minded business.
The CSR category applies to companies that voluntarily go beyond regulatory compliance in addressing social and environmental issues in their business operations. Respect for human rights in business is one of the CSR areas.
The CSR can be seen as corporate policy and practice, where companies voluntarily integrate social, environmental and transparent business concerns in their business operations and their external relations. Together with social and public partners, companies seek innovative solutions to address systemic social, environmental and overall economic well-being problems.
The Commission’s Communication on the renewed EU strategy 2011-14 for Corporate Social Responsibility, adopted on 25 October 2011 (hereinafter referred to as the Communication on CSR strategy) highlights the importance of internationally recognized principles and guidelines, stating that companies may take account of internationally recognized reliable guidelines and principles, provided also by the UN in the field of business and human rights. (…) This document is an important initiative towards the promotion of the CSR across the EU and internationally, harmonization of existing rules and development of new rules in this field. Lithuania supports the aim to encourage as many as possible companies to act responsibly and to set out clear goals for 2015-2020. The priority in the field of CSR should be given to the awareness-raising and best practice exchange; support to various initiatives; cooperation with Member States; education; cooperation between organisations, CSR capacity development across businesses. Proper implementation of the relevant measures could strengthen the integrated approach to the promotion of CSR and contribute to the exchange of best practices and collaboration.
To achieve this objective, the Government shall implement the following measures:
A. lmpłemented and on-going measures for the development of CSR in Lithuania
1. National Strategy for Sustainable Development. The National Strategy for Sustainable Development attributes CSR to the generał priorities of sustainable economic development. The implementation of the principle of participation of enterprises and social partners provides for closer social dialogue, stronger CSR, public and private sector partnership, as well as sustainable consumption and production.
2. National Programme for the Development of The Lithuanian National Programme for the Development of Corporate Social Responsibility for 2009-2013 (hereinafter referred to as the CSR Programme) and the Corporate Social Responsibility Action Plan for 2009-2011 (hereinafter referred to as the CSR Action Plan) were approved by Resolution No 53 of the Government of the Republic of Lithuania of 12 January 20 I O, which was followed by the next CSR Action Plan for 2012-2013 adopted by Resolution No 1057 of the Government of the Republic of Lithuania on 5 September 2012. These documents aimed to provide for promotion and development of CSR and to invite businesses to apply its principles in their operations, recognizing that socially responsible business responds to public expectations for welfare and serves as the basis for social and economic development.
The CSR Programme provides for key public policies related to the consistent, purposeful and integrated approach of the State towards the CSR, and establishes objectives of developing a CSR-conducive legal and institutional environment; promoting a better CSR understanding, and raising social and environmental awareness; as well as building CSR capacity among businesses and the stakeholders.
The development of CSR-conducive legal and institutional environment has resulted in simplified structure for the coordination of the development of corporate social responsibility and the management of an effective institutional cooperation (by revoking the governmental CSR Development Commission previously required under the CSR Programme), streamlining the quantitative criteria for the assessment of the implementation of the tasks provided for in the CSR Programme, and the decision by the Minister of Social Security and Labour to set up a Committee to monitor the implementation of the National Programme for the Development of Corporate Social Responsibility (hereinafter refe1Ted to as the CSR Committee), which had to oversee the implementation of the National Programme for the Development of Corporate Social Responsibility for 2009-2013.
The CSR Action Plan provides for the publication and regular update of the list of socially responsible national businesses. This list is placed on the website of the Ministry of Social Security and Labour.
3. The application of CRS principłes to the state-owned enterprises. One of the objectives of the CSR Programme approved by the Government in 201O is to develop methodological tools for the application of CSR principles, to ensure their dissemination and the exchange of best practices. 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 20 I O, actions were taken to restructure SOEs with a particular focus on corporate transparency and social responsibility. SOEs provide important public services as regards energy, water supply, public transport, electronic communications, health, education, social services and others. The application of the tools of socially responsible business may not only ensure that the highest return for the public is generated but can also make a positive impact on social stability and the promotion of business and human rights principles.
Lithuania already has SOEs engaged in socially responsible business initiatives. Model CSR application plan and its implementing guidelines for state-owned enterprises were prepared in 2012 aimed to facilitate introduction of CSR in state-owned enterprises, and to promote the use of CSR principles in their operations. This document lists examples of good practise of CSR in Lithuanian state-owned enterprises, naming among others AB Lesto, AB Lietuvos Gelezinkeliai, and Vilnius International Airport.
National network of responsible business. A Lithuanian National Network of Responsible Business was created in 2005 to provide training opportunities; promote cooperation and partnership among various sectors in Lithuania and abroad towards sustainable development. The Lithuanian Association of the Responsible Business (hereinafter referred to as the LAVA) was founded on 30 August 2013 on the basis of the former informal Lithuanian National Responsible Business Network, having brought together Lithuanian responsible businesses and organisations, mainly members of the United Nations Global Compact.
Current policy [page 9]
(…) In its letter ‘CSR Pays Off’ the government identifies its tasks in relation to ICSR. They are:
- to ensure that CSR frameworks are as clear as possible and that companies are informed about them;
- to promote a level playing field for Dutch business;…
- to hold other government authorities to account for their responsibilities, e.g. through economic diplomacy;
- to promote a transparency and stakeholder dialogue;
- to set a good example – by pursuing sustainable procurement policies, for instance.
The letter ‘CSR Pays Off’ also focuses on promoting business responsibility to respect human rights, the second pillar of the Ruggie Framework.
We can achieve the most if parties with different interests and target groups have a shared agenda and work together. Where the government can offer added value, it will bring parties and interests together. For example, through sector risk analysis it can check high-risk Dutch sectors for due diligence, enabling companies, civil society organisations and other stakeholders in these sectors to join forces.
The policy letter ‘Respect and Justice for All’ endorses the importance of integrated implementation of the Ruggie Framework and points to the responsibility of the business community in this respect. Credibility is an important element of Dutch human rights policy. The Netherlands Institute for Human Rights can monitor whether relevant legislation complies with the Netherlands’ human rights obligations. It has entered into a dialogue with companies and non-state actors on this issue. The Institute monitors policy, provides independent advice and researches human rights issues.
Agreements to improve working conditions in the agriculture and horticulture sectors [page 10]
The government has made agreements with the Dutch Federation of Agriculture and Horticulture and the grocery retail industry’s sector organisation on tackling abuses with conditions of employment and working conditions in the agriculture and horticulture sectors. The agreements apply to mushroom and strawberry production, the glasshouse horticulture sector and tree nurseries, all of which are high-risk sectors. Supermarkets will no longer source products from growers using employment agencies that do not possess the relevant Netherlands Standardisation Institute (NEN) certificate. In choosing their suppliers, supermarket buyers will devote specific attention to conditions of employment and working conditions. They will receive information on this matter from the Social Affairs and Employment Inspectorate. The Ministry of Social Affairs and Employment is now amending legislation so that imposed fines can be made public.
3. Results of the consultations and government response
3.1 An active role for the government [page 13]
“(…) As the government pointed out in its policy letter ‘CSR Pays Off’ and as is discussed under point 3 below on due diligence, the challenge in the next few years will be timely identification of risks in Dutch companies’ supply chains. The government wants to work on structural solutions within international chains, not incident management.”
BOX – Cooperation with the Dutch textile sector [page 14]
At a conference held on 20 June 2013, the sector organisations representing Dutch textile companies presented an action plan to tackle abuses in the production of clothing. (…) . The Minister for Foreign Trade and Development Cooperation has called on textile companies to commit to the plan. She has entered into dialogue with the sector on its implementation, and on opportunities to conclude a voluntary CSR agreement on textiles, for which the action plan forms a good starting point.
3.3 Clarifying due diligence [page 21]
In the 2011 update of the OECD Guidelines, the recommendation to apply due diligence was extended to the CSR domain. In all its communications with and conditions for the business community, the government uses the OECD Guidelines as its framework of reference for ICSR. Companies must take account of the potential social impact of their activities. Due diligence is thus the most important new element in the CSR policies of companies operating internationally and/or within international supply chains.”
Raising companies’ awareness [page 22]
The aim of the information strategy described in the policy letter ‘CSR Pays Off’ is to raise companies’ awareness of the need for due diligence. As an earlier study showed, SMEs operating internationally mainly need practical information. There are various aids for companies wishing to apply due diligence, and new ones are currently being developed, by the Social and Economic Council (SER), for instance. The government also has a role to play in making information and aids accessible. The knowledge centre CSR Netherlands plays an important role, while NL Agency and the embassies are major sources of information for companies operating at international level.
The government supports the SER with a grant for workshops to help companies shape the human rights component of their CSR policies, and to assist them in charting and prioritising the risks they face. These workshops are organised by SHIFT, a non-profit organisation set up with Professor Ruggie’s support to help companies and government authorities put the UN Guiding Principles into practice. The SER has also been given a grant to investigate whether the ISO 31000 risk management standard is applicable to CSR due diligence. It is essential for companies to have access to all available information on due diligence.”
BOX – CSR Risk Check
Using a grant from the Minister for Foreign Trade and Development Cooperation, CSR Netherlands has developed the CSR Risk Check for companies wishing to apply due diligence. Based on the sector and country in which a company is operating, this internet tool provides an indication of possible social impacts. CSR Netherlands works with the agency responsible for carrying out Sector Risk Analyses to harmonise the information on which the two instruments are based. This information will be used in the course of 2014 to compile sectoral world maps on which colour coding will be used to indicate whether a certain theme (e.g. child labour, discrimination of women) plays a role in a given country or region.”
One of the suggestions made during the consultations was to involve educational institutions in transferring knowledge, so that on graduating future entrepreneurs and managers will be aware of business responsibility for social impacts. The government feels that this would provide added value, and is now investigating which courses should take knowledge of business ethics and CSR on board.
Embassies are the spider in the web linking companies, government authorities and civil society organisations. They are thus in an excellent
position to inform Dutch companies abroad about the OECD Guidelines and the UN Guiding Principles. In the past few years, many embassies have worked to promote human rights within the framework of international enterprise. In March 2012, the embassy in Astana (Kazakhstan) organised a roundtable meeting on CSR. It was a great success, not least because it was attended by delegations from many Kazakh companies and government agencies as well as by ministry representatives and members of parliament.
The embassies bring Dutch and local entrepeneurs and civil society organisations together and are active in providing information on CSR,
human rights themes, the OECD Guidelines and National Contact Point (NCP) procedures. They can also identify country-specific risks. The CSR passport, a booklet for embassy staff with information on the OECD Guidelines, human rights and due diligence, is currently being updated.
Sector Risk Analysis [page 24]
An issue raised during the consultations was that the government should help companies to take a proactive approach in identifying risks to human rights. As announced in the CSR policy letter, Sector Risk Analysis has been introduced to identify the sectors that present the greatest risk of adverse social impacts and where priority should be given to strengthening company policy in relation to them. This forms part of the Dutch government’s due diligence towards the business community. In this way, it is helping the business community to fulfil its responsibility to apply due diligence on CSR. Both the business community and civil society organisations will be closely involved in the analysis. The government will enter into dialogue with the sectors identified in the analysis to explore how the situation can be improved. Human rights issues may also be raised. The government will report to the House of Representatives on progress with the project in early 2014.
Where specific issues relating to human rights and the Dutch business community play a role, the government will enter into dialogue with the companies concerned.
The government has reached agreement with a number of sectors on the subject of due diligence. Agreements with, for example, the textile sector and energy companies are now in preparation. The government is willing to remove obstacles identified by the companies concerned. It will support them in upscaling initiatives to international level – e.g. through the Better Coal Initiative dialogue – and will work for a level playing field for Dutch companies. The contents of these voluntary CSR agreements will depend on the nature of the problem, the degree to which the sector is organised and whether companies commit to achieving certain results or making certain efforts. The Minister for Foreign Trade and Development Cooperation and the Minister of Economic Affairs have requested the SER to advise them on effective CSR agreements with the business community. The SER is expected to issue its recommendations in early 2014. The sectors with which the government plans to enter into voluntary agreements will be announced in mid-2014.
Sector Risk Analysis
BOX- Land grabbing in Brazil [page 24]
Several Dutch financial institutions were recently linked through an investment partner to landgrabbing in Brazil. The Minister for Foreign
Trade and Development Cooperation immediately contacted the Dutch and Brazilian institutions concerned, and had talks with high-level
representatives of ABN AMRO Bank, the ABP Pension Fund, Aegon, the Entrepreneurial Development Bank (FMO), ING Bank, the Dutch Banking Association, the Federation of Dutch Pension Funds, PFZW pension fund and Rabobank. They discussed the need for greater transparency with regard to loans and investments, and had a constructive exchange of views on participation of Dutch financial institutions in multi-sector consultations on better land and land-use rights.
Legally binding measures [page 28]
The consultations failed to produce consensus on whether the obligations of Dutch companies in relation to CSR are adequately regulated by law, or whether more specific provisions are necessary. An independent committee will be asked to look into this matter, taking the following issues into consideration:
- relevant Dutch legislation and interpretations in case law;
- the situation in neighbouring countries (level playing field);
- the effects of legislation on companies and the business climate.
3.4 Transparency and Reporting
Reporting [page 29]
As it points out in its policy letter ‘CSR Pays Off’, the government supports the European Commission’s proposal to amend accounting legislation in relation to non-financial reporting. Large companies will be required to disclose information on human rights, environmental matters, social and employee-related matters and corruption. The proposal affects some 600 companies in the Netherlands, which together account for considerable social impact. The new Directive will ensure a level playing field at European level. What is more, it will place a limited administrative burden on the business community, since it is non-prescriptive as regards information provision, and works on the basis of the ‘apply or explain’ principle.
The Netherlands pursues an active policy of encouraging social reporting through the transparency benchmark. This benchmark is carried out every year on the instructions of the Ministry of Economic Affairs to give the 500 largest Dutch companies a rating for transparency on sustainability and CSR. The benchmark’s criteria have been updated and brought in line with international developments such as the UN Guiding Principles and the European Commission’s proposal for a new Accounting Directive. The Transparency Benchmark will now apply to the 600 companies referred to in this proposal(…)
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.
During the consultations, attention was again requested for the Production and Supply Chain Information (Public Access) Act (WOK). With this legislation, consumers, members of the public, civil society organisations and other parties who ask companies about the origins of their products and services would be assured of an answer. On the basis of the results of a study by Panteia/EIM15 in 2009, the government then in office concluded that implementation of the WOK was technically feasible, but that it would entail high costs for the business community, and its enactment would probably run into international legal obstacles. In this light, the government does not feel that this is the right time to enact such legislation, and points to the increasing availability of information on supply chains through instruments such as the Sustainable Trade Initiative and the Sector Risk Analysis project. The SER also devotes considerable attention to promoting supply chain transparency and responsibility in its ICSR committee. Moreover, it is possible to report to the NCP on companies that are insufficiently transparent for a constructive dialogue on CSR.
BOX – Burma
(…) To promote responsible investment, the Netherlands supports the Myanmar Centre for Responsible Business, a local platform for the development and coordination of capacity for business and human rights among all relevant actors in Burma. The platform focuses on promoting and enabling responsible investment in Burma, in accordance with the UN Guiding Principles. To this end, it supplies knowledge, tools and training to enable companies, investors, government authorities and civil society organisations in Burma to fulfil their roles. Through dialogue and consensus, it is drafting criteria to enable companies and investors to pursue effective human rights policies.
4. Action Points
Clarifying due diligence [page 42]
- The government will enter into dialogue with educational institutions providing courses in management-related studies on including business ethics and/or CSR in their curriculums.
- The government supports the SER with a grant for workshops to help companies shape the human rights component of their CSR policies, and to assist them in identifying and prioritising the risks they face. The SER has also been given a grant to investigate whether the ISO 31000 risk management standard is applicable to CSR due diligence.
- The government has entered into talks with Global Compact Netherlands on a follow-up to its publication ‘How to do Business with Respect for Human Rights’ (2010).
- The Ministry of Foreign Affairs will shortly provide an interministerial training course for civil servants whose work calls for knowledge of the UN Guiding Principles, and a refresher or other course for implementing organisations on the significance of the OECD Guidelines for companies.
- In 2014 an independent committee will investigate whether the obligations of Dutch companies in relation to CSR are adequately regulated in Dutch law, and in accordance with the UN Guiding Principles. The committee will take into account the relevant case law, the situation in neighbouring countries and the business climate.”
Transparency and reporting
- The voluntary CSR agreements reached with the sectors selected through the Sector Risk Analysis project will focus on transparency, dialogue with stakeholders and monitoring of agreements.
- The government will continue to call companies’ attention to the need to comply with the principle contained in the Corporate Governance Code that members of the management and supervisory boards should take account of CSR in fulfilling their duties and that their reports should include more information on their CSR policies.
1.3 CSR in the Norwegian business sector [page 13]
The Norwegian Corporate Governance Board (NUES) has published recommendations that have to be followed by all companies listed on the Oslo Stock Exchange. Another initiative is the Business for Peace Foundation, which promotes business practices that contribute to sustainable development. The social partners have played an active role in the development of decent working conditions, and NGOs have mobilised both business and the public sector to give priority to CSR. There are an increasing number of partnerships between civil society and business, such as the Ethical Trading Initiative Norway (ETI-Norway), which was set up in 2000 by the Norwegian Confederation of Trade Unions (LO), Virke, COOP and Norwegian Church Aid.
2. The State duty to protect human rights
2.1 The state as legislator [pages 18-19]
The Norwegian Human Rights Act states that certain key human rights conventions have the force of Norwegian law and take precedence over any other legislative provisions that are in conflict with them. In 2014, a number of human rights were also enshrined in the Norwegian Constitution. The duty of business enterprises to respect human rights is set out in Norwegian legislation, for example in the Working Environment Act, the Gender Equality Act and the Environmental Information Act. In addition there are acts regulating other areas that may have consequences for human rights, such as the Nature Diversity Act, the Pollution Control Act and the Greenhouse Gas Emission Trading Act. These are intended to contribute to a stable climate and a healthy environment, and to help safeguard the right to health. Generally speaking, Norwegian legislation safeguards human rights in Norway, so that companies that operate only in Norway are in little danger of violating these rights as long as they comply with the legislation.
However, although Norway already has in place sound legislation that applies to business, it may be necessary to consider amending certain acts in the light of the Guiding Principles and other international developments. It is often relevant to follow EU action in this field. The action plan therefore provides for review at regular intervals to ensure that legislation keeps pace with international decisions affecting human rights and CSR. Coherent follow-up of principle 8 (see section 2.7 below) should also be ensured. The Government will therefore appoint an interministerial working group headed by the Ministry of Foreign Affairs to ensure that such reviews are conducted. The aim of the working group is described in section 2.7.
The following are examples of relevant legislation.
The Accounting Act
Under the Accounting Act, large enterprises have been required to submit reports on CSR since 2013. The provision stipulating that enterprises must take account of human rights is considered to be in line with the Guiding Principles concerning the independent responsibility of enterprises to ensure that they respect human rights.
Amendments to EEA legislation
Small amendments to Norwegian legislation may be necessary in order to implement the expected new EEA rules corresponding to the new EU Directive (2014/95/EU) on disclosure of non-financial and diversity information by certain large companies and groups, which includes CSR. In this context it will be appropriate to look to other international developments, such the new UN Guiding Principles Reporting Framework.
Regulations on country-by-country reporting
Under the country-by-country reporting regulations, large enterprises that are required to submit accounts, and issuers of financial instruments listed on the stock exchange, in the extractive industry and/or forestry and logging, are required to prepare and publish an annual report on their activities by country and by project. The regulations entered into force on 1 January 2014, and will be reviewed after three years.
The Minerals Act
In Norway as in other countries, conflicts may arise between commercial activity and indigenous peoples’ rights. Protection of Sami rights is laid down in the Constitution and other legislation, and obligations towards the Sami people follow from international conventions, particularly Article 27 of the International Covenant on Civil and Political Rights and ILO Convention 169 concerning Indigenous and Tribal Peoples in Independent Countries. In Norway, Sami rights are also enshrined in special legislation and through consultation procedures between the public authorities and Sámediggi (the Sami Parliament). As part of its follow-up of ILO Convention 169, Norway is conducting a dialogue with ILO on how the convention is being implemented in Norwegian law, including in the area of mineral resources. In the Official Norwegian Report 2007:13 on legislation pertaining to the Sami, the Sami Rights Commission reviewed measures relating to mineral resources and in legislation that regulates mineral extraction. Some of the commission’s proposals were evaluated in connection with the preparatory work on the Minerals Act. The Act, which replaced five existing acts, entered into force on 1 January 2010. As part of the Government’s follow-up of the report from the Sami Rights Commission, the Ministry of Trade, Industry and Fisheries will evaluate proposals for amendments to the Minerals Act.
Legislation governing the export of arms, ammunition and other military equipment
Norwegian legislation governing the export of arms, ammunition and other military equipment, associated technology and services for military purposes is strict and comprehensive. It is based on the principle that Norway does not permit such exports to areas where there is war, a threat of war, or countries where there is civil war. The Foreign Ministry’s guidelines recommend that such applications should be rejected in cases where, for example, there is considered to be an unacceptable risk that the equipment to be exported is intended to be used for internal oppression or serious human rights violations. The Arms Trade Treaty (ATT), signed in April 2013, provides guidelines for the regulation of export control by states. The guidelines provide for the possibility that states may have more restrictive practices than those that follow from the ATT, and Norway will continue with its restrictive legislation. At the same time, the Government wishes to continue to provide Norwegian business enterprises with clear, predictable framework conditions for their export operations, for example by providing unambiguous, long-term guidelines for the Foreign Ministry’s processing of applications to export defence materiel. An annual report is submitted to the Storting on the Ministry’s implementation of legislation and guidelines, and on the scale of Norwegian exports of goods and related technology controlled by the EU Munition List.
Measures [page 20]
- appoint an interministerial working group to assess the need for follow-up of international decisions and to ensure coordinated implementation of this action plan (see section 2.7 for a more detailed description of the group’s objective and tasks). Each relevant ministry will continue to be responsible for assessing the need for legislative amendments and other measures in its area of expertise;
- review the country-by-country reporting regulations for the extractive industry and forestry in 2016–17;
- evaluate the amendments to the Minerals Act proposed by the Sami Rights Commission in their report;
- continue to practise a strict and predictable control regime for arms exports.
2. The State duty to protect human rights
2.2 The state as adviser [page 20]
A large number of public or officially supported institutions that work with business internationalisation provide guidance on CSR and human rights. Among them are the Foreign Service, Norad, the Ministry of Trade, Industry and Fisheries, and Innovation Norway. Norway’s OECD National Contact Point also provides information and guidance.
Although the advice given by these bodies often needs to be adapted to the context and situation of the individual company, the question of whether the various bodies’ advice is consistent should be examined. The Government’s goal is that Norwegian enterprises should encounter the same expectations regardless of which public authority they come in contact with, and the business sector expressed a desire for coherence in this respect in its input to the action plan. Such a review would also satisfy the terms of the white paper Human Rights in Opportunities for All: Human Rights in Norway’s Foreign Policy and Development Cooperation (Meld. St. 10 (2014–2015)).
The Government will therefore consider establishing a centre where the resources of several advisory bodies would be co-located. Such a centre would help to ensure coherence and best practice, and serve as a direct resource for companies. The secretariat of Norway’s OECD Contact Point, which is an important source of information, would be co-located in this centre.
There is also a need to raise the level of competence on international decisions in the public administration, and especially in public bodies that offer courses and training in business internationalisation.
Many Norwegian enterprises operate in new markets in weak states with poorly developed legislation or a poor capacity to enforce human rights legislation. Such companies are requesting advice and cooperation on CSR and related subjects such as security, risks and corruption. The diplomatic and consular missions and Innovation Norway in particular will be strengthening their capacity for advice and dialogue on such subjects.
In order to ensure that advice and guidance on CSR and human rights are relevant and up to date, the Government will continue the dialogue with the social partners and civil society, especially in KOMpakt, the Government’s Consultative body on matters relating ro CSR.
Under the UN Guiding Principles, the state has a particular responsibility for advising business enterprises in conflict-affected areas. This is described in more detail in section 2.6.
- consider establishing a centre for co-locating the resources of a number of public bodies that provide advice on CSR;14
- improve the level of competence on the UN Guiding Principles and the OECD Guidelines among the public bodies that offer guidance on CSR;
- strengthen guidance and dialogue with companies on human rights, business ethics, security and corruption in especially demanding markets;
- continue the work on CSR by KOMpakt, the Government’s Consultative body on matters relating ro CSR
3.2 Responsible business conduct [page 32]
“Norwegian companies should be aware that the UN Guiding Principles also include a responsibility to seek to prevent or reduce activities by their business relationships that have adverse human rights impacts. Examples of business relationships are subcontractors, enterprises the company has invested in, and business partners. However, the principles also emphasise that this does not mean that the company is complicit in the detrimental activities of its business relationships. They encourage companies to use their influence to mitigate the adverse impacts of such activities.
Pillar I. The State Duty to Protect human rights [pages 8-20]
National law identifies areas of fundamental human rights at work, as specified in the ILO Declaration on Fundamental Principles and Rights at Work:
Prohibition of forced or compulsory labour
Referring to the prohibition of this type of work, it should be noted that, although the Labour Code does not contain a definition of forced labour, according to Article 65(1) of the Constitution of the Republic of Poland, everyone shall have the freedom to choose and to pursue their own occupation and to choose their place of work (with exceptions specified by law). On the other hand, one of the basic principles of labour law is the right to choose work freely, resulting from the provision of Article 10 of the LC, which also guarantees minimum remuneration and the assistance of the public authorities in taking up employment, as part of state policies to combat unemployment. This provision does not, however, provide the grounds to demand employment. In addition to the right to choose work freely, as specified in Article 10 § 1 of the LC, there is the principle of discretion when establishing an employment relationship, set out in Article 11 of the LC.
Employment and occupation equality
As regards the principle of equal treatment of employees and the prohibition of discrimination in employment, this is clearly established in further provisions of the Labour Code, in particular in Chapter II a, ‘Equal treatment in employment’ (Articles 183a –183e). Counteracting discrimination in employment is one of the basic duties of employers. Employers are also obliged to provide employees with the text of the provisions on equal treatment in employment in the form of written information distributed on the premises of a work establishment or to provide employees with access to the legislation otherwise accepted by a given employer. The Labour Code sets out an open catalogue of grounds for discrimination. In Article 113 , the Labour Code establishes a prohibition of any discrimination on any grounds 10 whatsoever. Similarly, Article 183a § 1 of the LC, which introduces the obligation to treat employees equally in respect of establishing or terminating an employment relationship, employment conditions, conditions for promotion, as well as access to training in order to improve professional qualifications, in particular regardless of sex, age, disability, race, religion, nationality, political beliefs, trade union membership, ethnic origin, creed, sexual orientation, as well as regardless of whether employment is for a definite or indefinite period of time or full-time or part-time employment. The Labour Code contains definitions of equal treatment, direct discrimination, indirect discrimination, harassment, and sexual harassment. Equal treatment in employment means that there must be no discrimination whatsoever, directly or indirectly, whatever the grounds. Discrimination is also taken to include: • practices related to encouraging another person to violate the principle of equal treatment in employment or ordering a person to violate that principle; • harassment or unwanted conduct with the purpose or effect of violating the dignity of an employee or of creating an intimidating, hostile, degrading, humiliating, or offensive atmosphere. Concerning harassment and sexual harassment, the Labour Code guarantees employees that their submission to harassment or sexual harassment or their rejection of harassment or sexual harassment may not result in any negative consequences for said employees. According to Article 183b of the LC, a violation of the principle of equal treatment in employment occurs, with some exceptions, when an employer treats an employee differently on one or more grounds with the effect of, in particular: 1) terminating or rejecting the establishment of an employment relationship; 2) establishing disadvantageous conditions of remuneration for work or other terms of employment, or not being selected for promotion or not being granted other workrelated benefits; 3) not being chosen to participate in training organised to improve professional qualifications unless the employer proves that this was done for objective reasons. In discrimination cases, the burden of proof is shifted from the employee to the employer. The employee should, however, present facts that would lend credence to a case of discrimination. The Labour Code guarantees the right to equal remuneration for the same work or for work of equal value, including all components of remuneration, regardless of their name or characteristics. At the same time, it should be noted that the Labour Code does not explicitly define the concept of “the same work”. A person against whom an employer has violated the principle of equal treatment in employment has the right to compensation of at least the amount of the minimum remuneration for their work. The Labour Code also guarantees other rights to employees who assert their rights. The fact that an employee exercises his or her rights due to a violation of the principle of equal treatment in employment may not constitute a reason for disadvantageous treatment of the employee and may not result in any negative consequences for the employee. In particular, it may not constitute grounds for termination of an employment relationship by an employer, with or without notice. This regulation also applies to employees who have provided any form of support to an employee who has exercised his or her rights on account of a violation of the principle of equal treatment in employment. According to Article 943 of the LC, the employer is obligated to take action against workplace mobbing, which includes acts or behaviour towards an employee or 11 directed against an employee involving persistent and long-lasting harassment or bulling of an employee causing specific negative consequences. An employee who was harassed at work and developed health problems may claim an appropriate amount of money from the employer as a pecuniary compensation for the damage sustained. An employee who terminates his or her employment contract as a result of workplace bullying has the right to claim compensation from his or her employer in an amount not lower than the minimum remuneration for work, as specified under separate provisions. The employee’s statement on the termination of his or her employment contract must be made in writing, stating the reason for termination. Workplace bullying at one’s place of work or in connection with one’s work means a systematic repetition of certain behaviour directed at an employee that results in, e.g., the elimination of such an employee from the group. Particularly important in this case is the health aspect, which distinguishes the phenomenon of workplace bullying from an ordinary conflict. Ensuring equal treatment with respect to, among other things, undertaking and pursuing economic or professional activity is governed by the Act on the Implementation of Certain Regulations of the European Union Regarding Equal Treatment. This law implemented the following European Union directives: 1. Council Directive 86/613/EEC of 11 December 1986 on the application of the principle of equal treatment between men and women engaged in an activity, including agriculture, in a self-employed capacity, and on the protection of selfemployed women during pregnancy and motherhood; 2. Council Directive 2000/43/EC of 29 June 2000 implementing the principle of equal treatment between persons irrespective of racial or ethnic origin; 3. Council Directive 2000/78/EC of 27 November 2000 establishing a general framework for equal treatment in employment and occupation; 4. Council Directive 2004/113/EC of 13 December 2004 implementing the principle of equal treatment between men and women in the access to and supply of goods and services; 5. Directive 2006/54/EC of the European Parliament and of the Council of 5 July 2006 on the implementation of the principle of equal opportunities and equal treatment of men and women in matters of employment and occupation; 6. Directive 2014/54/EU of the European Parliament and of the Council of 16 April 2014 on measures to facilitate the exercise of the rights conferred on workers in the context of the free movement of workers (OJ L 128, 30.4.2014) The law determines the areas and means of preventing violations of the principle of equal treatment on the grounds of sex, race, ethnic origin, nationality, religion, belief, disability, age, or sexual orientation, as well as the competent authorities in this respect. The law applies to individuals, legal entities, and organisational units. The law (Article 3) defines the phenomenon of direct and indirect discrimination and explains the concepts of harassment, sexual harassment, unequal treatment, and the principle of equal treatment. According to Article 4, the law applies to, among other things, undertaking vocational training (including further training, improvement, professional retraining, and apprenticeship); the conditions for undertaking and conducting an economic or professional activity (including, in particular, employment or work under a civil-law contract); joining and taking part in trade unions, employers’ organisations, and 12 professional self-governing bodies; and also exercising the rights that members of these organisations are entitled to; having access to, and the opportunity to use, labour market instruments and services, human resources development and unemployment prevention, social security, healthcare, education and higher education, and services, including housing services, objects, and acquiring rights and energy, if they are offered to the public. Article 8 of the law prohibits unequal treatment of individuals on the grounds of sex, race, ethnic origin, nationality, religion, denomination, belief, disability, age, or sexual orientation as regards the conditions of undertaking and conducting economic or professional activity or working under a civil-law contract. It is also prohibited to encourage or order unequal treatment (Article 9). The law also identifies legal remedies for the protection of the principle of equal treatment and the competent authorities to deal with violations. Everyone whose right to equal treatment has been violated has the right to compensation. Employees employed under a contract of mandate or specific work contract have the right to claim compensation from their employer. However, they must justify their claims against the employer, i.e., lend credibility to their claim that there has been a violation of the principle of equal treatment. In this case, the employer is obligated to prove that no violation occurred. According to the provisions of the law, a victim of unequal treatment can only claim compensation, as the law does not provide for the possibility of awarding redress for harm caused by unequal treatment. Victims of discrimination must exercise their rights in court, in which case, the provisions of the Civil Code and the Code of Civil Procedure apply. Employers employing individuals under civil-law contracts are required to comply with the anti-discrimination provisions of the Act on the Implementation of Certain Regulations of the European Union Regarding Equal Treatment; otherwise, they may be exposed to costs due to possible compensation proceedings. The law introduces the principle of reversed proof of burden, as does the Labour Code. According to this regulation, anyone who alleges a violation of the principle of equal treatment should lend credibility to the fact of its violation, and the party that has been accused of discrimination must try to prove that they have not violated the principle.
Prevention of economic exploitation of children
Article 39 of the Convention on the Rights of the Child states that States Parties to the Convention “recognise the right of the child to be protected from economic exploitation and from performing any work that is likely to be hazardous or to interfere with the child’s education, or to be harmful to the child’s health or physical, mental, spiritual, moral or social development”.
Article 3045 of the LC provides that work or other paid jobs may only be performed by a child under the age of 16 for the benefit of an entity conducting cultural, artistic, sporting, or advertising activity, and only with the prior consent of the child’s statutory representative or guardian, as well as permission from the relevant labour inspector. The relevant labour inspector must refuse permission if the performance of the work will endanger the life, health, or psychophysical development of the child or if it constitutes a threat to the child’s performance of his or her school duties. In turn, the freedom to employ individuals between the ages of 16 and 18 is limited by the provisions of the Ordinance of the Council of Ministers of 24 August 2004 listing jobs prohibited to young people and conditions of employment for some of these jobs.
Freedom of association
Freedom of association is guaranteed by the provisions of the Constitution of the Republic of Poland (Articles 12 and 59) and legislation, in particular the Act of 23 May 1991 on Trade Unions (Journal of Laws of 2015, Item 1881). Poland has ratified the basic acts of international law on freedom of association, namely the International Covenant on Economic, Social and Cultural Rights (Article 8), the European Social Charter (Articles 5 and 6), and ILO Conventions Nos. 87 and 98. According to Article 3 of the Act of 23 May 1991 on Trade Unions, no person should bear negative consequences of membership or non-membership in a trade union or of holding a function in a trade union. In particular, this cannot constitute a condition for entering into an employment relationship, maintenance of such a relationship, or promotion. In accordance with Article 35(1)(c) of the Act on Trade Unions, discrimination against an employee because of his or her membership in a trade union, non-membership in a trade union, or the holding of a trade union function may result in criminal liability. The Labour Code prohibits the unequal treatment of employees with respect to establishing and terminating an employment, terms of employment, terms of promotion, as well as access to training in order to improve professional qualifications, in particular on the grounds of trade union membership (Chapter II a, Equal Treatment in Employment). An employee may seek compensation from his or her employer before a court of law for a violation of the principle of equal treatment in employment, which cannot be lower than the minimum remuneration for work stipulated in separate provisions. In addition, Article 183e of the LC provides for a mechanism of protection against the negative consequences of exercising employee rights or supporting an employee who has been treated unequally, e.g., on the grounds of his or her trade union membership. According to Article 183e § 1 of the Labour Code, the fact that an employee has exercised his or her rights when there has been a violation of the principle of equal treatment in employment may not constitute a grounds for disadvantageous treatment of such employee and may not result in any negative consequences towards the employee. In particular, it may not constitute grounds for termination of employment by an employer, with or without notice. The above-mentioned provision applies accordingly to an employee who has provided support to an employee exercising his or her rights in respect of a violation of the principle of equal treatment in employment (e.g., testifying as a witness in court proceedings). Other important areas addressing the issue of labour rights include:
The right to a fair wage
According to Article 23 of the Universal Declaration of Human Rights, “everyone who works has the right to just and favourable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection”. This right was specifically codified in Article 7 of the International Covenant on Economic, Social and Cultural Rights. The establishment of a minimum wage and a hourly minimum wage for certain civillaw contracts represents an instrument that furthers this goal. These issues are regulated by the Act of 10 October 2002 on Minimum Remuneration for Work (Journal of Laws 2015, Item 2008, as amended). According to the law, the minimum remuneration is the subject of negotiations in the Social Dialogue Council, consisting of representatives of the government, employees (trade unions), and employers (employers’ organisations). In the event of disagreement in the Social Dialogue 14 Council, the decision on the amount of minimum remuneration is taken by the Council of Ministers. The amount of minimum remuneration for work determines the minimum hourly wage. As of 1 January 2017, the minimum monthly remuneration for work is PLN 2,000. Systemic changes have also been introduced: it is no longer possible to set employee’s remuneration at a level lower than the minimum remuneration for employees with a short period of service (i.e., 80 per cent of that remuneration); the scope of the minimum remuneration component was also changed by removing the allowance for night-time work. As of 1 January 2017, a minimum hourly rate of PLN 13 applies to employees hired under mandate contracts and service contracts, including those who are self-employed. This amount will be adjusted annually to reflect the increase in the minimum remuneration for employees employed on the basis of an employment contract. Remuneration below the minimum wage constitutes a violation of employee rights. Each increase of the minimum wage improves of the situation of the lowest-paid workers. The introduction of a guaranteed minimum-remuneration for mandate contracts and service contracts, to which the provisions of mandate apply, is intended to generate a positive change in the labour market by preventing the abuse of civil-law contracts and introducing protections for individuals receiving remuneration at the lowest level.
Occupational safety and health
Article 7 of the International Covenant on Economic, Social and Cultural Rights calls on the States Parties to the Covenant to recognise the right of everyone to enjoy of just and favourable conditions of work, including safe and healthy working conditions, as well as rest, leisure, and reasonable limitation of working hours and periodic paid holidays, as well as remuneration for public holidays. The provisions for ensuring safe and hygienic working conditions by employers are set out in Division 10 of the Labour Code, “Health and Safety at Work”, as well as in other generally applicable laws. In accordance with the provisions of the Labour Code, employers are obliged to protect the health and life of their employees by providing them with health and safety conditions at work that appropriately use science and technology achievements. Employers are also obligated to organise work in a manner that ensures the above-mentioned conditions. In addition, Division 10 of the Labour Code specifies the rights and obligations of employees with respect to health and safety at work, the basic health and safety requirements for buildings and working premises, as well as machines and other technical equipment, requirements regarding factors and processes of work that create particular threats to health or life, obligations providing employees with preventive health protection, employers’ obligations related to accidents at work and occupational diseases, obligations to provide health and safety training, obligations to provide employees with measures of individual protection and work clothes and shoes, requirements to establish a health and safety at work service, requirements to provide consultations on health and safety at work and a commission on health and safety at work. In addition to the provisions of Division 10, the Labour Code also contains other provisions for the protection of the lives and health of women and young people who are employees, included in Division 8, “The Rights of Employees in Relation to Parenthood”, and Division 9, “Employment of Young People”. The provision of safe and hygienic work conditions for employees is also ensured by regulations of other laws, including the Construction Law, the Atomic Law, and the Geological and Mining Law. 15 The state’s activities as regards supervision and inspection of work conditions (in accordance with the requirements of international law) are important for ensuring health and safety at work. The system of measures that implement this policy is based, in particular, on the powers of the National Labour Inspectorate (reporting to the Sejm of the Republic of Poland) to supervise the observance of labour law, including health and safety at work, and the State Sanitary Inspection (reporting to the Minister of Health) to supervise compliance with work hygiene regulations. According to Article 304 of the LC, employers are obligated to ensure health and safety working conditions not only for their employees, but also for individuals performing work on a basis other than an employment contract at a work establishment or in a place designated by the employer, as well as for anyone conducting their own business activity at a work establishment or in a place designated by the employer. Obligations related to health and safety at work are applicable to non-employers who organise work performed by individuals on a non-employment basis and self-employed individuals. According to Article 3041 of the LC, the basic duties of employees (referred to in Article 211 of the LC) within the scope determined by an employer or another entity organising work will also be imposed on individuals who perform work on a different basis than an employment contract at a work establishment or in a place designated by the employer or other entity organising work, as well as on anyone conducting their own business activity at their work establishment or in a place designated by the employer or another entity organising work.
Right of female workers to protection
In view of the right of employed women to special protection under Article 8 of the European Social Charter, as well as the right of mothers to special protection during the period before and after childbirth under Article 10 of the International Covenant on Economic, Social and Cultural Rights, and under Article 177 of the LC, the employment relationship with a female employee during her pregnancy or while on maternity leave is accorded particular protection. During this time, an employer may not terminate an employment contract with or without notice unless there are reasons justifying termination without notice through the fault of the employee and an enterprise trade union representing the employee has consented to the termination of the employment contract. During pregnancy or maternity leave, it is possible to terminate an employment contract solely in the event that the employer declares bankruptcy or is liquidated. In such cases, however, the employer is obliged to agree with the enterprise trade union representing the female employee on the date of the termination of her employment contract. If it is not possible to ensure other employment within that period of time, the female employee is entitled to the benefits specified in separate provisions on cash benefits from social security in the event of sickness or maternity. The special protection of the employment relationship does not apply to female employees during their trial period not exceeding one month or to employees hired under an employment contract for a definite period of time concluded to replace an employee during a justified absence from work. These regulations also apply accordingly to employees on parental leave. The Labour Code also contains a number of provisions governing specific rights of employees related to parenting, including the provisions on maternity, parental, paternity, and child-care leave, as well as provisions to facilitate the fulfilment of parental responsibilities in relation to child care and education, including regulations that make it possible to combine leave with part-time work or regulations on working time and the use of exemptions from work or breaks from work. 16 The particular protection of employment relationships during pregnancy and maternity leave is subject to modifications resulting from the provisions of the Act of 13 March 2003 on Special Rules regarding the Termination of an Employment Relationship for Reasons not Related to Employees (Journal of Laws of 2016, Item 1474). This law, which applies to employers with at least 20 employees, permits termination of current employment and working conditions with notice, while still prohibiting termination, both in the case of collective redundancies and individual termination of an employment relationship during pregnancy and maternity leave. These regulations also apply accordingly to employees on parental leave. Under the Act on the Implementation of Certain Regulations of the European Union Regarding Equal Treatment, in the case of a violation of the principle of equal treatment, laid down in that law, against an individual, including in connection with pregnancy, maternity leave, leave on terms of maternity leave, paternity leave, parental leave, or child-care leave, such person is entitled to compensation.
Improvement of professional qualifications
Employers are obliged to enable employees to improve their professional qualifications. The Labour Code outlines the rules governing the conclusion of contracts regarding supplementary education, granting leave for education, a training leave, and additional benefits. The principle of enabling employees to improve their professional qualifications mainly relates to the qualifications necessary for the proper performance of their current job or the qualifications needed for the work that employees are supposed to do in the future for a particular employer. This does not mean that an employer should not, to the extent possible, foster their employees’ overall intellectual development. Such development is not only in the interest of employees, but also in the interest of the employer, because it influences the creative attitude adopted by employees at work. The principle of enabling employees to improve their professional qualifications is connected with the right to education, which is enshrined in Article 70 of the Constitution of the Republic of Poland, the Universal Declaration of Human Rights (Article 26), and the International Covenant on Economic, Social and Cultural Rights (Article 13). At the same time, it should be noted that the idea of lifelong learning is one of the most important premises of the so-called Lisbon Strategy and also one of the elements of Europe 2020, a strategy for smart, sustainable, and inclusive growth. Article 8 of the Act on the Implementation of Certain Regulations of the European Union Regarding Equal Treatment prohibits unequal treatment of individuals on the basis of sex, race, ethnic origin, nationality, religion, denomination, belief, disability, age, or sexual orientation, also in the scope of undertaking professional development activities (including further training, improvement, vocational retraining, and apprenticeship). In case of a violation of this prohibition, the injured party may seek compensation. The issue of the improvement of professional qualifications of workers is also governed by Article 10 of the European Social Charter and International Labour Organization Paid Educational Leave Convention, 1974 (No 140). These regulations oblige the state to promote the training of workers by granting them various forms of assistance, in particular financial entitlements and paid release from work.
Right to development
Another inalienable human right that should be guaranteed is the right to development. The UN Declaration on the Right to Development, adopted in 1986, emphasises the importance of human beings in the development process and points to the relationship between human rights and development. This declaration can serve as a guideline for the creation of national and international policies. It may be an instrument of: – incorporating human rights in the development process; – recognising the importance of the human factor in development efforts; – providing a political, legal, social, moral, and rational basis for development cooperation; – dialogue on human rights between developed and developing countries. States are obliged to pursue their chosen national development policies with a view to the steady growth of the well-being of society and of all individuals, growth based on a fair distribution of benefits. Both the Vienna Declaration and the Programme of Action adopted at the World Conference on Human Rights in Vienna state that development facilitates the enjoyment of all human rights. On the other hand, one may not claim a lack of development and, at the same time, justify a violation of human rights. This is due to the universal nature of these regulations being beyond all discussion. Article 55 of the United Nations Charter details the areas of international economic and social co-operation that, pursuant to Article 56 of the Charter, require common and independent action by UN member states. This co-operation includes: a) higher standards of living, full employment, and conditions of economic and social progress and development; b) solutions to international economic, social, health, and related problems; and international cultural and educational cooperation; and c) universal respect for, and observance of, human rights and fundamental freedoms for all without distinction as to race, sex, language, or religion.
3. Regulations on European Funds
Article 7 of Regulation No 1303/2013 of the European Parliament and of the European Council of 17 December 2013 laying down common provisions on five EU funds5 obligates all Member States to take appropriate steps to prevent any form of discrimination, including based on disability. 6 In view of the above, in 2015, the Ministry of Infrastructure and Development developed the Guidelines for the implementation of the principle of equal opportunities and non-discrimination, including accessibility for people with disabilities and the principle of equal opportunities for women and men within EU funds for 2014-2020. The above-mentioned Guidelines aim to ensure the compatibility of operational programmes (OPs) with the principle of equal opportunities and non-discrimination, including accessibility, for people with disabilities and the principle of equal opportunities for women and men, as well as to ensure a coherent approach in this respect under the European Social Fund (ESF), the European Regional Development Fund (ERDF), and the Cohesion Fund (CF). The Guidelines are addressed to all institutions that participate in the implementation of operational programmes cofinanced by the ESF, the ERDF and the CF, in particular managing authorities (MAs), intermediate bodies (IPs) and implementing authorities (IAs). MAs ensure that the competent decision-making body or which is a party to a project co-financing agreement under an OP will commit the beneficiary in a decision or project cofinancing agreement to apply the current Guiding Principles. The provisions adopted in these Guiding Principles are also an expression of the inclusion of the provisions of the United Nations Convention on the Rights of Persons with Disabilities, ratified by Poland in 2012, within the framework of structural funds. According to the Guiding Principles, the managing authorities of operating programmes develop criteria for the evaluation of applications for co-financing allocation in such a way that co-financing (also projects implemented by enterprises) is offered to projects that have a positive or neutral impact on the principle of equal opportunities and non-discrimination, including accessibility for people with disabilities, and the principle of equal opportunities for women and men. The creation of administrative capacity to implement equal opportunities and non-discrimination policies, including accessibility for people with disabilities and equal opportunities for women and men in relation to the European Structural and Investment Funds (EFSI) was regulated in the Action Plan for Equality and Non-discrimination 2014-2020 (22 April 2015). 8 This document is primarily an action plan for the measures that should be taken by the institutions involved in the implementation of EU funds to ensure accessibility for people with disabilities. The above-mentioned documents provide a strategic and operational framework for the disbursement of structural funds corresponding to EU policies on equal opportunity. They also represent the government’s efforts to implement and promote the provisions of the United Nations Convention on the Rights of Persons with Disabilities. In practice, the intention is to give disabled clients of European funds an opportunity to participate in the EU budget, i.e., the opportunity to use the funds, choose a career without barriers, and thus enjoy full inclusion in society. Hence, the introduction of a number of tools intended to ensure such accessibility, e.g., universal design, rational improvements, digital accessibility, or architectural availability.
5. Planned changes in national legislation:
Act on Counteracting the Unfair Use of Contractual Advantage in the Trade in Agricultural and Food Products.
The Act on Counteracting the Unfair Use of Contractual Advantage in the Trade in Agricultural and Food Products was prepared by the Ministry of Agriculture and Rural Development. Signed by the President on 28 December 2016, it will enter into force on 12 July 2017. The new act’s primary goal is to ensure the effective dispute resolution between suppliers and buyers of food and agricultural products. A contractual advantage occurs in cases where there is a significant disparity in economic potential between the two parties and where the weaker of these parties lacks the sufficient capacity for selling or purchasing agricultural or food products from other entrepreneurs.
Any entrepreneur who has a reasonable suspicion that it is being subjected to any practices which involve the unfair use of contractual advantage may submit a written complaint to the President of the Office of Competition and Consumer Protection. The Office of Competition and Consumer Protection may only intervene where the total value of the turnover between the supplier and the customer exceeded the amount of PLN 50 000 – during any of the two years preceding the year in which the proceedings were initiated and where the turnover of the supplier or customer applying the practices in question exceeded PLN 100 000 000 – during the year preceding the year in which the proceedings were initiated.
The regulation will help provide greater protection for smaller companies that, in situations of unfair use of contractual advantage, lost their liquidity, and consequently shifted the cost burden onto employees (e.g., delayed payment of wages).
“Package for Creditors”
As a result of a review of legal provisions related to the recovery of debtors’ receivables, in view of the impact of delays in settling obligations on the financial condition of enterprises, particularly in the SME sector and households, as well as the negative effects of actions by unreliable contracting parties, a draft law’s amendment was drawn up to strengthen the rights and guarantees for creditors protecting or enforcing their ownership by:
1) providing broader possibilities for verifying payment credibility of potential contracting parties, based on the data from the registries of economic information offices and the newly created Public-Law Debt Registry, while at the same time respecting the rights of debtors;
2) raising the upper limit of the subject matter of disputes for cases heard in simplified proceedings;
3) extending the scope of cases heard in class actions and eliminating the main barriers to the effective resolution of cases in these proceedings;
4) increasing the effectiveness of a solvency safeguard procedure and enforcement proceedings.
Most of the changes introduced pursuant to the Act of 7 April 2017 on the Amendment of Certain Acts to Facilitate Debt Recovery (Journal of Laws, Item 933) will apply to both entrepreneurs and non-entrepreneurs.
Attention should be paid, in the context of human rights, to regulations on collective bargaining aimed at:
- a) extension of the scope of class actions by enabling redress in class actions arising from non-performance or improper performance of a contract or from unjust enrichment and making claims for liability in cases related to injury to life or health;
- b) increasing the possibility of using class actions for payment through a less rigorous approach to harmonising claims in such cases and clarifying the effects of the harmonisation of claims;
- c) shortening the duration of class actions—their formal phases, e.g., through removal of the obligation to adjudicate at hearings on the admissibility of class actions, giving
up appeals against the decision on the case in class actions, and making it possible for a case to be heard (with respect to circumstances common to all members of the group) at the time when the complaint against the group composition is being heard;
- d) streamlining class actions for liability through clarification of the nature and subject matter of such proceedings;
- e) clarification of the rules regarding the use of a deposit to secure the costs of proceedings.
The changes are intended to shorten and streamline class actions. They will also make it possible to adjudicate more cases in class actions, including the claims of entrepreneurs. Making multiple claims for payment or determining liability for a specific event that affects the property of many individuals in single proceedings will improve the economics of the proceedings. It will help save time and resources related to bringing many individual actions that result from the same event or event of one kind. Consequently, these changes will facilitate the effective exercise of the right to access the courts.
Most of the changes will enter into force on 1 June 2017. The Ministry of Economic Development was responsible for drafting the bill.
Addition of general principles in administrative proceedings:
Friendly interpretation of the law (in dubio pro libertate)
The Act of 7 April 2017 Amending the Administrative Procedure Code and Certain Other Acts (Journal of Laws, Item 935) introduced into the Administrative Procedure Code the principle that, in the event of different interpretations of the law, the authority conducting the proceedings should adopt an interpretation favourable to the party. Thus, the party will be given protection against the negative consequences of unclear legal regulations and the associated uncertainty.
Interpretation of the law may cause difficulties both to citizens (other entities) and administrative authorities, as well as courts and entities performing tasks entrusted to public administration.
Decisions of public authorities where interpretative uncertainties have been adjudicated to the detriment of the party reduce confidence in the state and the laws it introduces. The proposed principle will have particular significance in proceedings imposing an obligation or punishment on the party or revoking the party’s right. In such proceedings the party’s sphere of freedom is restricted either directly or indirectly.
In the area of tax law, the Constitutional Court9 has indicated that the public administration authorities should, in accordance with the principle of in dubio pro tributario, resolve interpretation doubts in favour of the taxpayer. On the other hand, in the context of the protection of the right to property, the Supreme Administrative Court has argued in favour of restrictive interpretation with regard to interference with the rights of the owner.10 There is no doubt that the principle of in dubio pro libertate rights—and this is the case at hand—the court is obliged to follow the directive in dubio pro libertate. It should therefore interpret the rule in such a way as to reduce interference in the content of the co-owners’ right to manage joint property to a minimum.’ permeates the entire administrative law.11 By extending this principle to the level of proceedings before administrative authorities, the provisions that cause uncertainty should be interpreted in a way that does not harm the legitimate interests of citizens.
The constitutional principle of correct legislation serves to protect the confidence of citizens in the state and the law it adopts. The same values should also be more extensively protected in the process of application of the law. Consequently, this principle aims to comply with the same values as the above-mentioned constitutional principle. Although the law should be formulated in such a way that it is not difficult to interpret the meaning of its provisions, the occurrence of such difficulties cannot be ruled out. Therefore, the proposed principle aims to reduce the risk of any possible ambiguity of the provisions affecting the parties.
The principle of proportionality (relevance), impartiality, and the principle of equal treatment
The principles of impartiality and equal treatment, which should be of particular importance in cases involving several parties, have also been included in the provisions of the Act Amending the Administrative Procedure Code. The principle of impartiality means that administration authorities and their employees should not be guided in their actions by any interests or motives beyond the law that might violate the interests of the parties. In accordance with the principle of equal treatment, all parties in the same situation should be treated in a comparable manner without any discrimination.
The principle of deepening citizens’ confidence in the state authorities, a fundamental premise for establishing friendly relations between the administration and citizens, needs to be defined in a more concrete way. One of the basic criteria for assessing the extent to which the administration is friendly to the individual is the predictability of the actions of the public administration authorities and their respect for the individual’s interests. A party that files documents with an authority, generally in cases involving investment expenditure or requiring prior involvement of material resources, including time, has the right to arrange their interests in the belief that, acting in good faith and with respect for the law, it does not risk adverse legal consequences of their decisions, especially the effects that they could not predict at the time they were taken. The administration authorities are required to respect the principle of legitimate expectations so that the party is able to plan its activities in a rational manner.
This principle is based on the premise that the parties’ expectations are legitimate if they relate to lawful and possible actions, and that the authority, acting within the limits of the law, will adhere to its established practice of resolving matters in similar factual and legal situations. The authority should not, without special and important reasons, depart from established and uniform practice.
The adopted provisions also include the principle of proportionality, which requires administration authorities to undertake only such acts that cause an inconvenience for parties that are necessary and proportionate to the intended purpose. Engaging, in the course of proceedings, in activities onerous for the party, in particular involving a limitation of the party’s rights or creating a burden for the party, a public administration authority should take into account the interests of the parties and interfere in those interests only if and to the extent that it is necessary to achieve the intended purpose, in particular resolving the issue in accordance with the law
These principles are expressed in, e.g., Articles 5, 6, and 8 of the European Code of Good Administrative Behaviour.
Uniform standards for the imposition of administrative penalties
Administrative penalties under Polish law often constitute a severe sanction for violating the law. At the same time, the legal system includes no general rules that govern the imposition of these penalties, resulting in a significant differentiation of the situation of the entities subject to punishment, particularly with respect to the mechanisms mitigating the objective nature of administrative liability (e.g., as a result of the lack of determination or differentiation of the factors taken into account while estimating the amount of the pecuniary penalty), which is often unjustified due to the subject matter and the characteristics of a given regulation. Moreover, administrative sanctions are often imposed in an automatic manner, failing to take into account the causes and circumstances of the violation. In addition, administrative sanctions are in many cases more rigorous than criminal penalties, e.g., when no limitations period for the imposition of an administrative penalty has been established. Moreover, the automatic nature of imposing penalties and failure to take account of the circumstances of a given case is not conducive to ensuring a just—in a social sense—response on the part of the administration authorities.
This situation also raises doubts because of the principles established in a democratic state governed by the rule of law, in particular the principle of proportionality.
In the jurisprudence of the European Court of Human Rights, the standards of human rights protection in all sanctioning proceedings should be in line with the guarantees provided for in Article 6 of the Convention for the Protection of Human Rights and Fundamental Freedoms, signed in Rome on 4 November 1950, as later amended by Protocols 3, 5, and 8 and supplemented by Protocol 2.12 This means that the guarantees of Article 6 of the Convention are applicable in all quasi-criminal proceedings, including those that, under Polish law, are considered administrative proceedings. Proceedings before administration authorities that may end with the imposition of a penalty should, in principle, meet all the procedural standards provided for in Article 6 of the Convention for proceedings in which the conditions of liability are adjudicated. Also, the jurisprudence of the Supreme Court and the Supreme Administrative Court indicates the need to respect the decisions of the ECHR, expressed on the basis of Article 6 of the Convention in so far as the imposition of administrative penalties is concerned.
Therefore, the formulation of the principles for the imposition of administrative penalties was justified. This will ensure uniform standards of treatment for individuals and guarantee that penalties will be rational and commensurate with the violation.
The regulation deals with: (i) the so-called directives on administrative pecuniary penalties (e.g., the degree, circumstances, and duration of the breach of duty; the frequency of past violations; the degree of the offender’s contribution to the offence; the amount of the benefits achieved; and the personal circumstances of the individual to be punished); (ii) the grounds for not imposing a penalty; (iii) postponement of the date of execution of a penalty; or (iv) division of a penalty into instalments; (v) giving the entrepreneur public aid or de minimis aid in relation to relief in the imposition of a penalty; and (vi) the limitation of the imposition or execution of a penalty. Although the proposed solutions may be used by all citizens, it should be noted that entrepreneurs are particularly exposed to the automatic nature and excessive rigour of imposed administrative penalties. In particular, administrative penalties exert a significant impact on the business environment of entrepreneurs from the SME sector.
The introduction of general provisions on the imposition of administrative penalties into the legal order will be the first such regulation in Polish administrative law.
Regulations on so-called whistle-blowers
Efforts to regulate the position of so-called whistle-blowers will continue. Without changes in the sphere of the law and awareness, it will not be possible to realistically improve the situation of people who reveal abusive practices in Poland. Legislative work is currently under way at the Ministry of Justice with regard to regulations on the protection of whistle-blowers in Poland. It is also necessary to launch a broad social campaign due to the low level of social awareness of whistle-blowing and the role it plays in the public interest.
On 10 April 2017, a pilot programme called ‘Sygnaliści’ (Whistle-blowers) was initiated by the President of the Office of Competition and Consumer Protection. Anyone may report suspected anti-competitive agreement or abuse of a dominant position by a business on a dedicated telephone number or by email. This information can be submitted anonymously, and officials have no intention of determining the identity of the whistle-blower. However, there is a need to address the legal issues related to the status of whistle-blowers in a systematic way, and to protect them from possible negative consequences from the parties whose violations they have reported.
Amendment to the Act on Tourism Services
Plans are in store to undertake work on an amendment of regulations on the provision of hotel service, in order to introduce legislation related to the prevention of sexual exploitation of minors in hotel facilities (detailing requirements of hotel regulations), as recommended by the Council of Europe’s Convention on the Protection of Children against Sexual Exploitation and Sexual Abuse.
Amendment to the Trade Union Act
The Ministry of Family, Labour and Social Policy has drafted a bill amending the Trade Union Act that provides for extending the right of workers to organize onto individuals performing paid work but not mentioned in the provisions of the Act (in particular contractors or self-employed individuals), who have all the characteristics of workers within the meaning of the Constitution. The proposed changes are a consequence of the decision of the Constitutional Tribunal of 2 June 2015, ref. Act K 1/13, which ruled that Article 2(1) of the Trade Union Act, in so far as it restricts the freedom of associating in and joining trade unions by individuals pursuing paid work not referred to in that provision, violates Article 59(1) in conjunction with Article 12 of the Constitution of the Republic of Poland.
It is planned to adapt the provisions of the current trade union law to new realities after the extension of workers’ right to organize and the need to ensure that all trade unionists, irrespective of the nature of their legal relationship with their employer, are able to freely exercise the right to organize in trade unions. The bill is currently in legislation. The draft law has been reviewed by social partners, e.g., as part of the proceedings of the Social Dialogue Council.
Rules governing the liability of Internet intermediaries for hate speech and violation of freedom of speech
The Ministry of Digital Affairs plans to draft a regulation to counteract restrictions on the freedom of speech, on the one hand, and to block illegal content on the Internet, on the other. Legislative work is being carried out that clarifies the procedure for notice and takedown of the illegal content online, as well as strengthens legal safeguards for freedom of speech in the activities of electronic service providers. These efforts address i.a. issues related to hate speech or incitement to violence, as well as the use of unauthorised technical restrictions on freedom of speech in social media.”
6. Actions resulting from the Council of Europe recommendation on human rights and business [page 26]
1) The text of Recommendation CM/Rec(2016)3 to member states on human rights and business (hereinafter referred to as the Recommendation), together with the Explanatory Memorandum, was translated into Polish.
- responsible entity: Ministry of Foreign Affairs;
2) The Recommendation, together with its translation into Polish, will be disseminated among competent public authorities, competent public inspection authorities, courts, prosecutors, police, entrepreneurs, business organisations, and workers’ organisations, social dialogue bodies, entities working to protect human rights, and diplomatic and consular missions. It will also be duly integrated into the curricula of training programmes.
- responsible entities: Ministry of Economic Development; Ministry of Family, Labour and Social Policy; Ministry of Justice; Ministry of the Interior and Administration; Ministry of Foreign Affairs; Government Plenipotentiary for Equal Treatment; and the Government Plenipotentiary for Civil Society, in cooperation with other relevant ministries and bodies;
3) The Recommendation will be analysed to assess the compatibility of the law and practice in Poland and to formulate proposals for possible actions to be taken to implement such compatibility.
- responsible entity: Ministry of Economic Development in cooperation with other ministries, including: Ministry of Family, Labour and Social Policy; Ministry of Justice; Ministry of the Interior and Administration; Government Plenipotentiary for Equal Treatment; and the Government Plenipotentiary for Civil Society;
4) Poland will prepare an interim report and a final report on the state of implementation of the Recommendation with a list of good practices applied by the country:
- responsible entities: Ministry of Foreign Affairs; Ministry of Economic Development; Ministry of Family, Labour and Social Policy; and other ministries;
- completion date: by the end of 2018 (interim report and list of good practices) and by the end of 2020 (final report).
7.Planned and ongoing activities [page 27]
Inclusion of references to the United Nations Guiding Principles on Business and Human Rights in government documents and action plans, including in the National Action Programme for Equal Treatment.
Pillar II. The corporate responsibility to respect human rights
3. Non-financial reporting: implementation of Directive 2014/95/EU [page 30]
Since January 2017, it has been mandatory for a certain group of companies to disclose information regarding the application of human rights policies in business practice in connection with the transposition of Directive 2014/95/EU into Polish law.
Directive 2014/95/EU on disclosure of non-financial and diversity information by certain large enterprises and groups came into force on 6 December 2014. EU Member States had two years to transpose the directive into national law.
It is estimated that the provisions will affect about 6,000 entities in the European Union, while in Poland some 300 enterprises may be required to disclose non-financial data. In Poland, the Ministry of Finance was responsible for the transposition. The Act of 15 December 2016 amending the Accounting Act was published on 11 January 2017 in the Journal of Laws (Journal of Laws 2017, Item 61) as a transposition of the above-mentioned Directive with respect to disclosure of extended non-financial information. The Act came into force on 26 January 2017 and will apply for the first time to reports prepared for the financial year beginning on or after 1 January 2017.
The implemented provisions of the Directive aim to increase the transparency of information with respect to corporate social responsibility (CSR) presented in management reports (in the form of a statement) or in separate reports as regards environmental, social, and occupational issues, respect for human rights, and anti-corruption measures. New reporting obligations are addressed to large entities and generally include those that primarily operate in the financial sector, including banks, insurance companies, issuers of securities, and large capital groups.
Under the Directive and its transposed law, the companies subject to this obligation may apply any national, EU, or international reporting standards or guidelines, including their own rules.
7.Equal opportunities for people with disabilities [page 35]
As regards equal opportunities for disabled people, entrepreneurs should take into account the following issues:
– architectural accessibility: conducting accessibility audits, application of solutions that meet the needs of people with various disabilities, including systems supporting hearing, e.g., in conference rooms, main reception areas, facilities for the blind and visually impaired, ensuring the availability of sanitary facilities;
– developing products, services, goods, and space based on the universal design concept or designing for everyone, including the disabled, seniors, pregnant women, people with baby strollers;
– digital accessibility: accessible websites that should meet the WCAG 2.0 accessibility standard; accessibility of all digital content should be ensured, i.e., online publication of editable documents (e.g., open PDF, Word), avoiding scans of paper documents;
– human resources policy: accessible working environment, employing disabled people (also other disadvantaged groups in the labour market);
– application of rational improvements, i.e., changes and adjustments, in accordance with the needs of disabled employees and customers;
– accessibility in information and promotion activities: social clauses in orders for the performance of tasks and services, communications (e.g., PR) expressed in a language that is easy to understand, respect for diversity, organisation of accessible events;
– treatment of accessibility as the operating standard and the philosophy of the subject rather than a one-off operation.
These issues are addressed both to the public administration and the business sector, and their implementation will enable the creation of modern-looking entities that are open to serving clients with diverse needs and effectively meet their expectations.
9. Support in the implementation of the UN Guiding Principles by companies [page 35]
Equal treatment policy
The obligation to treat all employees equally regardless of their sex, i.e., the legal prohibition of discrimination on grounds of sex is one of the fundamental human rights under the applicable law. Equal treatment is based on the principle of equal pay for the same work or work of equal value, equality in decision-making processes, and equal access to training and promotion. The key areas in this respect include:
– combating discrimination in the workplace (including on grounds of sex);
– equal access for men and women to promotions and training;
– equal remuneration for the same work or work of equal value;
– increasing the participation of women in corporate decision-making bodies;
– diversity management, including employee recruitment and selection, talent management and payroll policies, also in the sphere of an enterprise’s organisational culture;
– providing employees with instruments and mechanisms to enable a good work-life balance. 36
Measures planned by the government to support the implementation of the UN Guiding Principles in these areas focus on working with business representatives, representatives of social partners, and non-governmental organisations dealing with the protection and pursuit of equal opportunities, e.g., through:
– supporting initiatives to improve compliance with human rights standards, including initiatives to strengthen gender equality and diversity in the workplace;
– promoting available solutions and developing, in collaboration with business and social partners, new tools and methods to promote awareness of human rights and equal treatment in the workplace;
– supporting initiatives to promote available solutions and developing, in collaboration with business representatives and social partners, new tools and methods to promote awareness in the area of implementation of equal-treatment policies at enterprises;
– promoting knowledge about the application of compensatory measures in the workplace, or promoting equal opportunities for people belonging to disadvantaged groups;
– measures promoting the benefits of diversity policy and equal opportunities, e.g., balanced participation of women and men in decision-making bodies (promotional and information campaigns, projects co-financed from EU funds, support for initiatives undertaken by entrepreneurs);
– promoting good practices with a view to ensuring equal opportunities by enterprises, e.g., in employee recruitment and selection, talent management, protection against discrimination, management of the remuneration system, etc.;
– supporting initiatives to build a broad coalition for creating a working environment that is free of discrimination and based on the principle of equal opportunities. These measures should involve a wide range of actors, both state institutions and private companies, NGOs, academia, the media, and social partners;
– supporting the development of research and analysis of social inequalities, which may serve as the basis for any possible remedial actions.
The constitution for Business [page 36]
Polish legislation on matters of undertaking and conducting economic activity does not contain any provisions that differentiate the situation of entities based on religion, belief, disability, age, gender, or sexual orientation. Moreover, Article 6(1) of the Act of 2 July 2004 on Freedom of Economic Activity (Journal of Laws of 2016, Item 1829, as amended) expresses the principle of freedom of economic activity by ensuring that everyone is free to undertake, conduct, and terminate economic activity under equal rights pursuant to the terms and conditions set forth by the law. Consequently, all entrepreneurs should be treated equally, i.e., without either discriminating or favouring differentiation.
As part of the ongoing efforts to implement the objectives of the Responsible Development Plan, the current Act on Freedom of Economic Activity is to be replaced by a new transparent legal act of economic law, i.e., the Law of Entrepreneurs. Together with the accompanying laws, the act forms a part of the so-called Constitution for Business package, i.e. a set of legal acts that regulate and streamline the economic activity of entrepreneurs in a comprehensive manner, and stimulate Polish business. According to the proposed regulations, the Law for Entrepreneurs will include the obligation to respect and protect human rights, in accordance with applicable international standards, as well as a number of legal principles governing the position, rights, and obligations of entrepreneurs. In the context of respect for human rights by the business world , it is necessary to pay special attention to the proposed principle of fair competition and respect for good practices and legitimate interests of other entrepreneurs and consumers, which will serve as the guiding principles for the conduct required from entrepreneurs in relation to their economic activity.
10. Planned and ongoing activities [page 37]
1) Promoting good practices in human rights and business, including with respect to state-owned enterprises and enterprises commissioned by the state;
2) Supporting enterprises in the assessment of risks with respect to human rights in doing business in non-EU countries, using the expertise of foreign institutions in Poland;
3) Increasing the involvement of foreign institutions in issues related to human rights and business, including local laws and enterprise operations in Poland, with a view to exercising human rights, with particular regard to the situation of armed conflicts;
4) Promoting dialogue, as needed, between entrepreneurs, civil society organisations, and the government on the implementation of the UN Guiding Principles on Business and Human Rights;
5) Working to establish cooperation between state institutions and business-sector entities to counteract and reduce the phenomenon of forced labour, as one of the forms of trafficking in human beings.
Implementation of the National Action Plan
1.Education [page 53]
The public administration’s role in implementing responsible business conduct includes creating favourable conditions for shaping appropriate forms of cooperation that facilitate making a voluntary commitment to responsible development and social responsibility.
Education and wide dissemination of RBC standards is an important element in this respect, including responsible supply chains and respect for human rights. These actions should be addressed both to direct producers and companies in the supply chain, as well as consumers.
It is appropriate to take preventive measures against forced labour, including education and information initiatives for employers, and to support both the public and private sectors in preventing and responding to the threat of forced labour.
Information on the UN Guiding Principles on Business and Human Rights and the European Council conclusions of 20 June 2016 recommending the inclusion of diplomatic missions in the promotion of the Guiding Principles and their application in their ongoing operations has been sent by the Ministry of Foreign Affairs to all embassies, consulates and Polish Institutes.
III. Areas of Actions and Measures
Pillar I. The State Duty to Protect Human Rights
Operational Principles [pages 15-17]
Guiding Principle 3
- The Government will develop actions to train civil servants and public employees in matters of business and human rights due to their assigned tasks.
- The Government, through cooperation for development, will contribute to the development of the capacities of other States in matters of business and human rights.
- The Monitoring Committee, referred to in chapter IV of this Plan, in collaboration with the State Council for Corporate Social Responsibility (CERSE4), will periodically evaluate if the laws and regulations to which the Guiding Principle 3 refers are appropriate.
- The Regulations will be implemented and the Directives will be transposed, and the adaptation of the Spanish legal system to the Recommendations and the Opinions made by the EU regarding the Guiding Principles will be studied. This, will be done taking into account the reports published by the European Commission on the legal framework for human rights and the environment applicable to European companies operating outside the EU (2010), and on responsible management of the supply chain (2011) and other relevant reports.
- The implementation will be promoted by business and trade unions, general or sectorial, including representative organizations of social economy entities; as well as other institutions such as chambers of commerce, chambers abroad, universities, business schools, etc. of actions that should promote online training and advice and Resolution of queries, coordinated with those carried out in the application of the Spanish Strategy of Corporate Social Responsibility.
- In accordance with the recommendations of the EU, the Government will promote information and training of SMEs and social economy entities, through all available means in business associations, and will promote the creation of sectorial forums of learning in order to discuss good practices and to reach commitments of interest for each sector.
- In parallel, the Government, in collaboration with independent and specialized institutions with accredited experience in human rights matters where conflicts of interest do not arise, will collaborate in the creation and consolidation of on-site training programs and will promote the inclusion of specific contents on human rights in the training activities of business organizations and of the Public Administration.
- The Government will collaborate with other governments in the development of training materials and tools
- The Government will train the personnel of the State Foreign Service, in accordance with Law 2/2014, of March 25, of the Action and of State the Foreign Service, as well as to the agencies in charge of the internationalization of business abroad about the responsibility of companies to respect human rights and due diligence and redress procedures, and will incorporate the Guiding Principles into the Annual Plans for External Action and the Brand Spain. Likewise, through its Diplomatic Missions, Permanent Representations and respective Sectorial Offices, especially the Economic and Commercial Offices, as well as through the Consular Offices, Technical Cooperation Offices and Training Centers of Spanish Cooperation AECID5 abroad, will disseminate tools and guidelines according to the characteristics of each country.
- 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 11. The National Contact Point of the “OECD Guidelines” will act as a focal point to provide information and advice on business and human rights issues.
1. The State Duty to protect
Swedish legislation to protect human rights [page 10]
Human rights are protected in Swedish legislation primarily via the constitutional regulations in the Instrument of Government, the Freedom of the Press Act and the Fundamental Law on Freedom of Expression. An individual’s fundamental rights and freedoms are also expressed in other laws. The European Convention for the Protection of Human Rights and Fundamental Freedoms has been incorporated into Swedish law in its entirety and thus applies as Swedish law. When applying EU law, Sweden is obliged to follow the EU Charter of Fundamental Rights. The provisions contained in Swedish law relating to the fundamental rights and freedoms of the individual are primarily aimed at public sector services within central government, municipalities and county councils.
Through other legislation, such as civil law legislation on rights at work and on discrimination, as well as criminal law legislation, the State seeks to ensure that an individual’s human rights are also respected by third parties, including business enterprises.
A typical feature of the Swedish labour market and the Swedish model is that the relationship between employer and employee is largely governed by collective agreements. These agreements often contain regulations that supplement and replace the procedures established by law. The most important act in the area of individual labour law is the Employment Protection Act (1982:80), which regulates how employment contracts may be entered into and terminated. This Act includes provisions stating that indefinite-term contracts should be the general rule but that fixed-term contracts can be mutually agreed in some cases. The Act also states that notice of termination of an indefinite-term employment contract must be based on objective grounds.
In the area of collective labour law, the Employment (Co-determination in the Work-place) Act (1976:580) is the main act. This Act regulates, for example, the right of employee organisations to participate in negotiations ahead of certain decisions by an employer, for example regarding significant operational changes. The Trade Union Representatives (Status at the Workplace) Act (1974:358) is also part of collective labour law. This Act contains regulations on the status of trade union representatives and the right to participate in trade union activities at individual workplaces.
The purpose of the Discrimination Act (2008:567) is to combat discrimination and in other ways promote equal rights and opportunities regardless of sex, transgender identity or expression, ethnicity, religion or other belief, impairment, sexual orientation or age. The Act applies to employment in a broad sense, educational activities, labour market policy activities and employment services not under public contract, starting or running a business, supply of goods, services and housing, organisation of a public gathering or event, and health and medical care and social services.
Disputes concerning the relationship between employer and employee are often resolved in the Labour Court, which is a specialised court for examining labour law disputes. The Labour Disputes ( Judicial Procedure) Act (1974:371) contains certain special regulations on labour law disputes.
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:
- Protection of life and health, through criminal liability for crimes such as murder, assault, manslaughter and work environment crimes (Chapter 3, Swedish Penal Code).
- Protection of liberty and peace, through criminal liability for human trafficking, including for the purpose of exploiting a person’s labour, and other provisions protecting against coercion or deprivation of liberty. Provisions also exist to protect against harassment, intrusive photography, breach of postal or telecommunication secrecy, unlawful interception and breach of data security (Chapter 4, Penal Code).
- Protection of property, against corruption, etc., through criminal liability for offences such as theft, robbery, fraud, extortion, receiving stolen goods, bribery, dishonesty to creditors and infliction of damage (Chapter 8–12, Penal Code).
- Provisions on crimes involving public danger also protect the above-mentioned interests through criminal liability for acts such as arson (Chapter 13, Penal Code).
- Criminalisation of international crime also provides for protection of life, health and property. The Act on criminal responsibility for genocide, crimes against humanity and war crimes (2014:406) entered into force on 1 July 2014.
- Criminal liability under the Act on Criminal Responsibility for the Financing of Particularly Serious Crimes in Some Cases (2002:444), the Act on Criminal Responsibility for Terrorist Offences (2003:148) and the Act on Criminal Responsibility for Public Provocation, Recruitment and Training concerning Terrorist Offences and other Particularly Serious Crimes (2010:299) also provides protection in this context.
- Under Swedish law, jurisdiction is extensive and Swedish courts are therefore often able to adjudicate in cases concerning offences committed abroad. Normally, for this to occur, the perpetrator would need to have some ties to Sweden and the offence would need to be subject to criminal liability under the law of the place where it was committed. However, such restrictions do not apply to the most serious crimes, i.e. certain specified crimes such as crimes under the Act on criminal responsibility for genocide, crimes against humanity and war crimes and, in general, all crimes with a minimum sentence of imprisonment for four years, for example, exceptionally gross assault (Chapter 2, Penal Code).
- 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).
As outlined in this action plan, the Government will support businesses in their efforts to respect human rights in their operations.
Annex: Measures taken
“In 2013, the Swedish Government adopted a platform for Swedish action on corporate social responsibility (CSR). The issue of business and human rights has received considerable attention in recent years. The following examples describe some measures already taken in accordance with this policy.
Regulations and legislation [page 21]
- The Inquiry on protection of workers who blow the whistle on various unsatisfactory conditions, irregularities or offences submit-ted its report on 20 May 2014 (Swedish Government Official Reports 2014:31). The Inquiry proposes a new labour law act strengthening the protection provided to whistleblowers. Under the act, workers who have suffered reprisals for whistleblowing will be entitled to damages. The Inquiry’s proposals have been circulated for comment.
- With a view to improving the protection provided to workers, amendments have been proposed to the Work Environment Act and the Working Hours Act. Under these amendments, financial penalties would largely replace penal sanctions to create a more effective sanctions system.
- In 2014, the Government Bill ‘Measures to manage major criminal cases and the cancellation of main hearings’ (Govt Bill 2013/14:170) was passed by the Riksdag. The bill proposed to give the parties greater influence and participation in proceedings so that accusations of criminal offences can be heard within a reasonable time, maintaining high standards.
- The UN Guiding Principles on Business and Human Rights point out that the costs of bringing claims are sometimes a barrier to having a case heard. Even after statutory amendment (1987:452), the fees charged by Swedish courts are low by European standards.
Annex: Measures taken
In 2013, the Swedish Government adopted a platform for Swedish action on corporate social responsibility (CSR). The issue of business and human rights has received considerable attention in recent years. The following examples describe some measures already taken in accordance with this policy.
The State as actor [page 21]
- Sweden has published Swedish translations of the UN Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises on the government website.”
Annex: Measures planned [page 28]
- The Government will conduct a baseline study of how Swedish legislation compares with the Guiding Principles to determine whether there are any immediate or obvious gaps that need to be addressed.
- The Ministry for Foreign Affairs’ reports on the human rights situation in countries around the world will be developed to more easily provide companies with guidance on human rights issues and risks in the countries in which they operate. These human rights reports are available on the Swedish Government website.
- Sweden will work to improve the implementation of the UN Guiding Principles for Business and Human Rights, for example by urging foreign governments to develop national action plans.
- Central government will enhance its collaboration with the regional CSR networks in Sweden and take particular steps to strengthen the dialogue with small and medium-sized enterprises (SMEs).
- The Government Offices is considering conducting special due diligence in sectors facing distinct challenges.
- Sweden will continue its activities related to business and human rights abroad under the leadership of the Ambassador for Corporate Social Responsibility.
- The Government will draw up a new platform for the full spectrum of CSR issues, including respect for human rights, to be submitted to the Riksdag in the form of a written communication.
- The Government Offices is prepared to con-sider continued support to the Shift Project for its development of the Reporting and Assurance Frameworks Initiative (RAFI). Companies are encouraged to use the UNGP’s Reporting Framework developed by Shift and Mazars.
5. National Action Plan on Business and Human Rights
5.7 Pillar 1: state duty to protect
5.7.2 Operational principles: legislative and information policy measures
Guiding Principle 3 [pages 13-21]
To an extent appropriate to the attendant risks, the federal government exercises its influence in the form of non-legally-binding and, where necessary, legally-binding instruments to encourage and to require business enterprises to respect human rights. Where appropriate, it also takes action tailored to the human rights risks specific to individual sectors or issues.
As one of the objectives of government, and a binding duty on the State, respect for human rights is laid down in the Federal Constitution (FC). Article 35 FC includes the provision that fundamental rights (Art. 7 et seqq. FC) must be upheld throughout the legal system (Art. 35 para. 1 FC), which also covers private, criminal and commercial law, and places the authorities under the obligation to ensure that fundamental rights, where appropriate, apply to relationships among private persons (Art. 35 para. 3 FC). Article 54 FC lists the federal government’s foreign policy objectives. Of particular relevance in the context of business and human rights are the alleviation of poverty, respect for human rights, the promotion of democracy, the peaceful co-existence of peoples, and the conservation of natural resources. The fight against corruption also contributes to human rights, and to ensuring the rule of law.
Based on the Federal Constitution, the Federal Council is discussing the following policy instruments (PI) to implement Guiding Principles 3a and 3b:
PI1 Human rights due diligence
Swiss legislation does not make any provision for business enterprises having to conduct general, legally binding human rights due diligence. Potential regulation in this area would have to have a broad base of international support to avoid placing Switzerland at a disadvantage as a business location. The Federal Council supports due diligence on a voluntary basis, however.
In May 2014, in fulfilment of postulate 12.3980 from the National Council Foreign Affairs Committee, the Federal Council had a report drawn up to compare legally binding due diligence obligations in other countries. It also discussed options for Switzerland in an accompanying commentary36. The report shows that no country makes any provision for a comprehensive duty to conduct human rights due diligence. In March 2015, the National Council rejected a motion from its Foreign Affairs Committee to introduce a binding obligation for business enterprises to conduct human rights due diligence.
A key concern for a number of stakeholders is the introduction of legally binding human rights due diligence. In April 2015, an alliance of 66 civil society organisations launched the Responsible Business Initiative38, which would like to see a general human rights due diligence obligation enshrined in law. The popular initiative was submitted on 10 October 2016, and on 1 November 2016 the Federal Chancellery confirmed that it will go forward to a referendum.
PI2 Regulation of private security service providers
The business context of private security service providers exposes them to an increased risk of becoming involved in human rights abuses. In September 2013, Parliament thus passed the Federal Act on Private Security Services provided Abroad. The Act and the associated Ordinance entered into force effective 1 September 2015. The Act prohibits security firms based in Switzerland from participating directly in hostilities in an armed conflict abroad, and forbids activities that support the commission of serious violations of human rights. It also contains reporting requirements for companies wishing to provide private security services abroad, and obliges Swiss-based providers to accede to the International Code of Conduct for Private Security Service Providers.
The Federal Council regards the Federal Act on Private Security Services provided abroad as an appropriate means of ensuring respect for human rights in connection with the activities of private security service providers. It will undertake an initial assessment of its effectiveness at the end of the reporting period.
PI3 Regulation of war material
Business enterprises which manufacture or trade in war material are exposed to an increased risk of becoming involved in human rights abuses by third parties. International standards on the regulation and control of international trade in conventional weapons were laid down in the international Arms Trade Treaty (ATT). It was adopted by the UN General Assembly in April 2013 and entered into force on 24 December 2014. Switzerland ratified the Treaty on 30 January 2015.
The manufacture and transfer of war material and the associated technologies is governed by the War Material Act and its Ordinance. The manufacture, brokerage, export and transit of war material for recipients abroad will be authorised if this is not contrary to international law, international obligations and the principles of Swiss foreign policy. The decision on whether or not to issue authorisation for a foreign transaction must abide by the criteria laid down in the War Material Ordinance. In addition to other factors, the domestic situation in the country of destination, specifically respect for human rights, must be taken into account. If the country of destination violates human rights in a systematic and serious manner, it is imperative that the export licence be denied. However, authorisation might still be granted in exceptional cases if there is a low risk that the exported war material will be used to commit serious violations of human rights.
The Federal Council regards the present legal foundation and practice for granting export licences as appropriate to guarantee that Swiss business enterprises that manufacture or trade in war material will respect human rights. No further measures are planned.
PI4 Regulation of technologies for internet and mobile communication surveillance
Technologies for internet and mobile communication surveillance can be used for both civilian and military purposes, i.e. they are dual-use goods. They can be an element in state repression, for example, thereby exposing the business enterprises that manufacture or trade in them to an increased risk of becoming involved in human rights abuses.
The export or brokerage of technologies for internet and mobile communication surveillance is governed by goods control legislation. On 13 May 2015, the Federal Council decided that a licence to export or to broker such goods must be refused if there is reason to believe that the exported or brokered good will be used by the final recipient as a means of repression. The transfer of intellectual property, including expertise and the grant of rights, concerning technologies for internet and mobile communication surveillance was also made subject to licence.
The Federal Council regards the new legal foundation, and practice for granting export licences, as appropriate to guarantee that human rights will be respected in connection with technologies for internet and mobile telecommunication surveillance. No further measures are planned.
PI5 Regulation of the manufacture and import of renewable resources (biofuels)
The Mineral Oil Tax Act provides that biofuels (biogas, bioethanol, biodiesel and vegetable and animal-based oils) will be wholly or partly exempted from mineral oil tax if they satisfy minimum environmental and social requirements44. Under the Mineral Oil Tax Ordinance, the minimum requirements for socially acceptable production conditions are fulfilled if, in the cultivation of the resources and production of fuels, business enterprises comply with the social legislation applicable at the production location, but at a minimum with the fundamental conventions of the ILO.
The criteria were toughened up further with the implementation of parliamentary initiative 09.499 Agrotreibstoffe. Indirekte Auswirkungen berücksichtigen [‘Agrofuels: considering the indirect impacts’]. In the future (cf. Art. 12b para. 3 MinOTA), the Federal Council will have the right to refuse the tax exemption if biofuels have been produced in a country which does not have food security. Furthermore, the area used for cultivating the resources used to produce biofuels must have been acquired lawfully, to prevent the displacement or dispossession of the local population. Should biofuels which do not fulfil the criteria for tax relief enter circulation in large quantities in Switzerland in the future, the Federal Council may make them subject to an authorisation requirement.
The Federal Council regards the present legal foundation and practice for granting licences as sufficient and is not planning any further measures
The federal government will employ the following policy instruments (PI) to implement Guiding Principle 3c:
PI6 Clarify and communicate what the Federal Council expects of business enterprises
Governments should provide business enterprises with guidance on action to respect human rights, by clearly defining and communicating their expectations. This was one of the primary demands made by the business sector during the consultation process.
Section 4.3 of the Federal Council’s report in fulfilment of postulate 12.3503 Eine Ruggie Strategie für die Schweiz [‘A Ruggie Strategy for Switzerland’], which sets out the framework for this NAP, defines the position and expectations of the Federal Council with respect to business enterprises. Business enterprises based and/or operating in Switzerland should abide by international standards such as the UNGP, the OECD Guidelines for Multinational Enterprises, and the relevant sector and issue-specific guidelines.
This NAP sets out the position and expectations of the Federal Council with respect to business enterprises in more specific detail, and strengthens the consistency of federal government action to protect and promote human rights in the context of business activities.
The federal government will carry out awareness-raising programmes (e.g. website, workshops, publications) geared specifically to the needs of SMEs, and will help to raise consciousness about the issue of business and human rights with information events and materials. Part of the aim of these programmes is to step up federal government efforts to communicate its expectations to business enterprises. This can, for example, also be achieved by means of forums for dialogue, and participation in events and courses aimed at stakeholder groups and the general public.
PI7 Federal government contact point for stakeholder groups
Many of the stakeholders taking part in consultations expressed the desire for a better overview of the various government activities in the business and human rights sphere, and to have the relevant information accessible in one place.
As part of work to implement the CSR position paper (cf. Section 2.2.6), the federal government will establish a CSR web portal by the end of the reporting period. It is intended to make information on the federal government’s commitment to corporate responsibility (including that for human rights) available to business enterprises and other interested organisations and individuals from a central point. The portal will bundle information about instruments, international developments, and support. It will also serve as a point of contact for questions and concerns about business and human rights. These will then be passed on to the federal agencies responsible for the issues in question.
PI8 Guidelines for business enterprises on implementing the UNGP
The federal government has supported the development of a variety of guidelines on business and human rights in recent years. Further to Recommendation 11 in the Federal Council’s Background Report on Commodities, the federal government is joining forces with NGOs and commodity trading firms to draw up guidelines for the implementation of the UNGP in commodities trading. Under the terms of the mandate, the guidance should include specific recommendations concerning human rights due diligence and reporting.
During the reporting period (2016-2019), the federal government will work with the international sporting associations which are based in Switzerland (including the International Olympic Committee), with sponsors, NGOs, international organisations, other governments and the Institute for Human Rights and Business to implement the UNGP in the context of major sporting events. It is leading and supporting multi-party dialogue with the following objectives: to identify the primary challenges in respecting and protecting human rights in this context; to promote a learning process; to exchange best practices, and to strengthen responsibility. A multi-party steering committee is conducting a series of pilot projects on issues such as the integration of human rights due diligence into the awarding of major sporting events, the development of guidelines for host cities and countries, the integration of human rights in sporting association governance and in the value chains of products linked to sport, as well as the establishment of grievance mechanisms and the involvement of particularly vulnerable groups.
In the financial sector, SECO is supporting the OECD with the drafting of guidance on due diligence in this industry. Planned for the end of 2017, one of the objectives of the guidance is to support financial institutions in Switzerland to mitigate the negative impacts of their business activities on the environment on society around the world, including developing countries. The work is being supported by an advisory group of representatives of the federal government (SECO), industry (UBS), civil society (Public Eye [formerly the Berne Declaration] and the University of Zurich).
In the agricultural and food sector, the Federal Office for Agriculture (FOAG) and the Swiss Agency for Development and Cooperation (SDC), as well as the Committee on World Food Security, the UN FAO and the OECD are supporting the formulation of Principles for Responsible Investment in Agriculture and Food Systems, as well as the OECD-FAO Guidance for Responsible Agricultural Supply Chains. Both instruments stress the important role that business has to play in responsible investment, and offer relevant guidance on action. Switzerland will also actively support their implementation.
PI9 Good practice award
The Federal Council intends to promote good practice by creating an award for the Swiss Business and Human Rights Champion of the year. It will recognise business enterprises which make an outstanding contribution to the field of business and human rights. The FDFA and EAER will work alongside academic and civil society stakeholders to establish the award.
The concept for the award ceremony will be drawn up at the beginning of the reporting period (2016-2019). It is to be implemented using existing resources. No cash prize accompanies the award.
PI10 Initiative on respect for labour and human rights in value chains
The federal government promotes the implementation of the fundamental conventions of the International Labour Organization (ILO) as part of economic development cooperation, and in cooperation with the ILO itself. In this context, it designed a project with the ILO to ensure that labour rights are implemented by business enterprises in developing countries. It supports the ILO and International Finance Corporation (IFC) Better Work programme for the clothing industry as well as the ILO’s SCORE (Sustaining Competitive and Responsible Enterprises) programme, which focuses on working conditions at SMEs. Among its economic cooperation programmes, the federal government also supports projects to protect children. These projects are run jointly with the ILO, governments, the private sector and unions, and are focused on compliance with fundamental labour standards, including measures to combat child and forced labour. The federal government also pursues a wide variety of activities to support the human rights aspects of sustainable value chains. The federal government will continue these activities, as set out in its Dispatch on International Cooperation 2017-2020.
PI11 Multi-stakeholder initiatives in the business and human rights field
Switzerland is engaged and involved in multi-stakeholder initiatives in the business and human rights field. For example, it was a co-initiator of the International Code of Conduct for Private Security Service Providers (ICoC)52. It is also playing a key role in the development of an independent mechanism to manage and verify compliance with the Code on the part of business enterprises.
In the next two years, the controlling and governance mechanism for the International Code of Conduct for Private Security Service Providers (ICoCA) will implement certification and verification processes and will deal with complaints that have been received about member firms. Switzerland participates in the work of the Board of Directors of the ICoCA, and provides financial support to its secretariat. The initiative helps to implement the Federal Act on Private Security Services provided Abroad.
Switzerland is also a member of the ‘Voluntary Principles on Security and Human Rights’ (VP) initiative, and is involved in developing and enhancing the scheme. Within the framework of the VP, it promotes better and more transparent accountability for participants, and also contributed to the revision of reporting criteria. Switzerland also plays an active part in the discussions on reforming the governance of the VP initiative, which is intended to promote the practical implementation of the VP on the ground, as well as compliance. To raise awareness among Swiss companies from the mining and oil sector, as well as other interested business enterprises, Switzerland will be holding a workshop on the VP and on security and human rights in 2017.
Furthermore, Switzerland supports the policy dialogue instigated by the UN Special Rapporteur on trafficking in persons to prevent human trafficking in value chains. Within these bodies, Switzerland works towards the integration and implementation of the UN Guiding Principles on Business and Human Rights.
The federal government will employ the following policy instruments (PI) to implement Guiding Principle 3d:
PI12 Sustainability reporting standards
Reporting on the action taken by a business enterprise to respect human rights is an important element of due diligence under Pillar 2 of the UNGP53.
In line with the Grüne Wirtschaft [‘Green Economy’] report (2016) and the Federal Council’s national action plan on corporate social responsibility54, the federal government campaigns at both national and international levels for the promotion and harmonisation of corporate sustainability reporting. This also covers human rights. Switzerland is a member, among others, of the Group of Friends of Paragraph 47 (GoF47), which promotes sustainability reporting internationally. Within the GoF47, Switzerland works in particular with the Global Reporting Initiative (GRI) and the United Nations Environment Programme (UNEP).
The Federal Council will continue its work within the GoF47. It also supports the drafting of sector-specific guidance and practical examples.
PI13 Corporate sustainability reporting
The EU decided at the end of 2014 to introduce mandatory sustainability reporting. Member States have until the end of 2016 to put this obligation into effect. EU Directive 2014/95/EU determines that certain large undertakings and groups must publish non-financial information on respect for human rights, diversity, and combating corruption and bribery in connection with environmental, social and employee matters. According to the comply or explain principle, business enterprises must also disclose why they have not published certain information. The Federal Council is closely monitoring developments with regard to the legally binding reporting of non-financial information in the EU. It is prepared to examine possible action, which would be as congruent as possible with international regulation, and intends to draw up a consultation draft on sustainability reporting that will be based on the EU instrument. Work will begin when more is known about the way in which EU Member States intend to implement the Directive.
Swiss business enterprises are not obliged to report on sustainability issues. However, in line with the 2030 Agenda and its Sustainable Development Goals (SDGs), which were adopted by all UN Member States, and in particular to achieve SDG 12.6, companies are encouraged to introduce sustainable practices and to include sustainability information in their reporting.
Accounting legislation requires all companies that are subject to an ordinary audit pursuant to Article 727 of the Swiss Code of Obligations (CO) to include a general assessment of risk in their management report. This also includes human rights risks, where these are present. Listed companies are also obliged by Article 53 of the SIX Swiss Exchange Listing Rules to report on human rights matters where these might affect the company’s share price. The Federal Council recommends incorporating the human rights risks which business enterprises identify in their due diligence processes, for example, in their sustainability reports.
PI14 Child protection in tourism
In collaboration with Austria and Germany, in 2012 Switzerland launched a trinational campaign to combat the sexual exploitation of children in connection with tourism.
Entitled nicht-wegsehen.ch (‘Don’t look away’), the campaign draws public attention to the sexual exploitation of children and minors in the context of the tourism industry. The campaign website provides a publicly accessible form with which suspicious activities can be reported to the Federal Office of Police. The campaign is being extended to an increasing number of European countries.
To date, the campaign has been funded by public offices and child protection authorities, in close collaboration with the travel industry (SECO and the Swiss Foundation for the Protection of Children).
PI15 Obligation to disclose payments to governments
Fulfilling Recommendation 8 of the Background Report on Commodities and postulate 13.3365 Mehr Transparenz im Schweizer Rohstoffsektor [‘Greater transparency in the Swiss commodities sector’], in May 2014 the Federal Council produced an interpretive framework for the commodities sector. It subsequently integrated a transparency requirement compatible with EU provisions in its draft revision of company law in Switzerland. The Federal Council is proposing that listed and major companies in the extractive sector must disclose the payments they make to governments. The Dispatch on Amending the Code of Obligations (Company Law [including transparency provisions]) was adopted and referred to Parliament on 23 November 2016. The Federal Council will also continue to support international transparency standards, through vehicles such as the Extractive Industry Transparency Initiative (EITI).
PI16 Reduction in human rights risks attached to gold extraction and trading
In view of the important position that Switzerland occupies in gold trading, as well as in processing and refining, there is the risk that gold from illegal mines, used in some cases to fund armed groups or organised crime, will find its way into Switzerland. This might impact negatively on the protection of human rights in gold-producing countries.
The passing of postulate 15.3877 Recordon – Goldhandel und Verletzung der Menschenrechte [‘Recordon – gold trading and human rights abuses’] resulted in the Federal Council being mandated to present a report examining the gold sector and its human rights risks in connection with Switzerland, as well as any options for action. The postulate should be fulfilled by the end of 2017.
The Better Gold Initiative launched in 2013 created a value chain for sustainably produced gold from small Peruvian mines. Since then, over a tonne of gold from certified mines has been imported into Switzerland, and sold at a fair price.
SECO is currently working alongside the Swiss Better Gold Association to plan the second phase of the scheme – the Better Gold Initiative for Artisanal and Small-Scale Mining – which is scheduled to start at the beginning of 2017. The second phase should see the Initiative extended from Peru to Columbia and Bolivia, and an increase in the traded volumes of responsible gold from small-scale mining. This is to be achieved by means of greater private-sector involvement, the introduction of entry standards, and by intensifying the political dialogue.
The UK 2013 NAP
The State’s Duty to Protect Human Rights
The existing UK legal and policy framework
The UK is subject to international human rights obligations under customary international law and as a result of the international legal instruments we have signed and ratified. Human rights obligations generally apply only within a State’s territory and/or jurisdiction. Accordingly, there is no general requirement for States to regulate the extraterritorial activities of business enterprises domiciled in their jurisdiction, although there are limited exceptions to this, for instance under treaty regimes. The UK may also choose as a matter of policy in certain instances to regulate the overseas conduct of British businesses.
The UK has specific laws protecting human rights and governing business activities. As with all UK law, these are set out in legislation or sometimes protected by common law rules which, taken together, ensure certain rights and liberties. Some of these provisions have been in place for many years and will be familiar to business. Like all States we need to continually re-assess whether the current mix is right, what gaps there might be and what improvements we can make.
The UK has ratified a series of international treaties and agreements – the International Labour Organisation’s eight core conventions, the International Covenant on Civil and Political Rights, the International Covenant on Economic, Social and Cultural Rights and the European Convention on Human Rights – which enshrine human rights and fundamental freedoms and have been given effect through the law. The Human Rights Act 1998 ensures that individuals in the UK have a remedy for the breach of rights which are protected by the European Convention on Human Rights (ECHR). It applies to all public authorities and other bodies performing public functions, as private companies sometimes do.
The relevant legal framework in the UK includes employment regulations that require companies not to discriminate against employees on grounds of sex, race, sexual orientation and religious belief, and environmental regulations. Examples of wide ranging legislation protecting human rights in the business context include the Health and Safety at Work Act 1974, and the Data Protection Act 1998 which applies to companies and ensures respect for the privacy of individuals. Legislation has also been passed to plug specific gaps in the protection of workers under the law such as the Gangmasters (Licensing) Act 2004, which created an agency to prevent the exploitation of workers in agricultural work, shellfish-gathering and related processing or packaging.
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 Government exercises controls on the export of “strategic” goods and technology through the export licensing system. All export licence applications are rigorously assessed against the Consolidated EU and National Arms Export Licensing Criteria. These assessments take full account of possible human rights impacts; a licence would not be granted if we judge there is a clear risk that the proposed export might be used for internal repression.
(i) under the UK’s Presidency of the G8, obtained G8 support for responsible business investment in Burma in line with the UN Guiding Principles. We have also funded the creation of a resource centre in Rangoon to sensitise incoming investors to the importance of human rights compliant business in Burma, based on the UNGPs. The FCO’s initial funding has now been supplemented with support for the next stage from the UK’s Department for International Development (DFID).
(ii) sought and are committed to ensuring that in UK Government procurement human rights related matters are reflected appropriately when purchasing goods, works and services. Under the public procurement rules public bodies may exclude tenderers from bidding for a contract opportunity in certain circumstances, including where there is information showing grave misconduct by a company in the course of its business or profession. Such misconduct might arise in cases where there are breaches of human rights. In addition, UK public bodies are required to have due regard for equality-related issues in their procurement activity.
(iii) negotiated and agreed the OECD 2012 Common Approaches, including a requirement for Export Credit Agencies (ECAs) to take into account not only potential environmental impacts but also social impacts, which is defined to include “relevant adverse project-related human rights impacts.” The OECD 2012 Common Approaches also require ECAs to “consider any statements or reports made publicly available by their National Contact Points (NCPs) at the conclusion of a specific instance procedure under the OECD Guidelines for Multinational Enterprises.” UK Export Finance will consider any negative final NCP statements a company has received in respect of its human rights record when considering a project for export credit.
(iv) played a leading role in developing the International Code of Conduct for Private Security Service Providers (ICOC). This sets out companies’ commitments to standards of behaviour, particularly on human rights, and will be independently audited. By June 2013 a total of 659 companies had signed the ICOC, including about a third from the UK.
(v) taken account of business activity in conflict and fragile states, or countries with high levels of criminal violence, within the Building Stability Overseas Strategy. Companies operating in these difficult environments have an important role to play incontributing to stability, growth, development, prosperity and the protection of human rights. We support the implementation of the OECD Risk Awareness Tool for Multinational Enterprises in Weak Governance Zones. We will also continue to help develop, and monitor implementation of, OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict Affected and High-Risk Areas. The Government will also continue to encourage higher standards in the diamond supply chain.
(vi) continued to provide financial support to the UN Global Compact, a global mechanism that encourages and enables companies to align their operations and strategies with ten universally accepted principles in the area of human rights, labour, environment and anti-corruption.
(vii) invested £750,000 in 2012-13 from the FCO’s Human Rights and Democracy Programme in projects promoting the UNGPs and anticipate a similar level of spending in 2013-14.
New Actions Planned
The Government will do the following to reinforce its implementation of its commitments under Pillar 1 of the UNGPs:
(i) Develop partnerships with other countries seeking to implement the UNGPs. We already have a strong collaborative partnership with the Government of Colombia on implementation in both countries, in the context of the November 2011 joint statement on human rights by the Prime Minister and President Santos.
(ii) Begin certifying Private Security Companies in the UK based on the agreed UK standard for land-based companies, by working with the UK Accreditation Service (UKAS) to take forward the certification process, ensuring this includes expert human rights advice. We will also agree a standard for maritime PSCs this year. We will take forward our work with the Swiss, Australian and US governments, industry and NGOs to establish an international mechanism to monitor compliance with the International Code of Conduct for Private Security Service Providers. We will engage with state and non-state clients to urge them to commit to contracting only with PSCs that are pursuing certification against recognised standards by accredited certifying bodies, and membership of the ICOC Association.
(iii) Work together with partners in the Voluntary Principles on Security and Human Rights to strengthen the implementation, effectiveness and membership of the Voluntary Principles, including through the UK Chairmanship of the initiative beginning in March 2014.
(iv) Review the degree to which the activities of UK State-owned, controlled or supported enterprises, and of State contracting and purchasing of goods and services, are executed with respect for human rights, and make recommendations to ensure compliance with the UNGPs.
(v) In line with the UK Cyber Exports Strategy, develop guidance to address the risks posed by exports of information and communications technology that are not subject to export control but which might have impacts on human rights including freedom of expression on line.
(vi) Promote new project activity on raising awareness and tackling the negative impacts of business activity, including on the human rights of groups like indigenous peoples, women, national or ethnic minorities, religious and linguistic minorities, children, persons with disabilities, and migrant workers and their families, by tasking our diplomatic missions in countries where these are concerns.
(vii) Ensure that agreements facilitating investment overseas by UK or EU companies incorporate the business responsibility to respect human rights, and do not undermine the host country’s ability to either meet its international human rights obligations or to impose the same environmental and social regulation on foreign investors as it does on domestic firms.
(viii) Lobby foreign states, including through ministerial contact and our embassies and high commissions, to support widespread international implementation of the UNGPs and other relevant international instruments including the ILO’s Fundamental Principles and Rights at Work and the eight core Conventions which embody them, and the OECD Guidelines for Multinational Enterprises.
(ix) Work with EU partners to implement the UNGPs across member states and internationally, starting with the undertaking made by member states in the EU Action Plan on Human Rights and Democracy to develop their own national plans by the end of 2013.
(x) Support the UN Working Group on the issue of human rights and transnational corporations and other business enterprises in their role to promote uptake of the UNGPs and develop guidance and best practice (we contributed £100,000 in 2012).
(xi) Instruct our embassies and high commissions to support human rights defenders working on issues related to business and human rights in line with EU Guidelines on human rights defenders.
UK’ companies responsibilities to respect human rights
Government expectations of business
Actions taken to support business implementation of the UNGPs
To help businesses to fulfil their responsibility to respect human rights we have so far:
(i) published this action plan, setting out the Government’s actions and expectations on business and human rights. We will seek clear and consistent communication of this policy through ministers, UK business ambassadors and officials who engage with business, and on Government websites and social media pages, including those of our embassies and high commissions.
(ii) taken steps to ensure that from 1 October a clarification of the Companies Act 2006 means that company directors will include human rights issues, in their annual reports;
(iii) developed the joint FCO-UKTI Overseas Business Risk (OBR) service, which provides information about business environments in the countries where UK Trade and Investment (UKTI) has a presence, to ensure it includes specific country human rights information and links to the UNGPs and other relevant tools and guidance; http://www.ukti.gov.uk/export/howwehelp/overseasbusinessrisk/countries.html
(iv) updated the Government’s “Business and Human Rights Toolkit” – a detailed guidance manual for officials – in light of the UNGPs and have brought it to the attention of all relevant officials, including through the training courses we run for FCO and UKTI staff.;
(v) instructed our embassies and high commissions to work with host governments, local and UK business, trade unions, NGOs, human rights defenders, academics lawyers and other local experts so we can help inform companies of the human rights risks they face;
(vi) provided support to convening mechanisms that bring together business and civil society representatives to drive practical action, for example, the Ethical Trading Initiative.;
(vii) funded an online hub – in 6 languages – providing guidance and information on the UNGPs where companies can share successful outcomes and promulgate best practice. http://www.business-humanrights.org/UNGuidingPrinciplesPortal/Home
Further actions planned
(i) continue to develop Government guidance so that it is accessible and helpful, especially to SMEs. We will work with relevant industry associations and other corporate groupings. And we will signpost guidance specifically intended to help SMEs, such as that available from the Equality & Human Rights Commission at:
and the European Commission at:
(ii) encourage trade associations/sector groupings of companies to develop guidance relevant to their members’ sector of activity on developing human rights policies and processes, including due diligence. There is generic guidance online about doing this e.g. at the Business & Human Rights Resource Centre. Some sector-specific guidance also exists, for example the International Council on Mining and Metals has produced a guide for mining companies on human rights due diligence. The European Commission has created guidance on the information communications technology (ICT), oil and gas and employment and recruitment sectors; http://ec.europa.eu/enterprise/policies/sustainable-business/corporate-social-responsibility/human-rights/index
(iii) support dialogue between business people, parliamentarians and civil society on the implementation of the business and human rights agenda, and share examples of good practice and examples of where the absence of this has created difficulties for companies.
(iv) instruct our diplomatic missions to raise with local authorities our concerns in situations where companies have problems implementing their human rights responsibilities because local law is incompatible with international human rights law.
The UK 2016 updated NAP
2. The State’s Duty to Protect Human Rights [page 7]
12.The UK has specific laws protecting human rights and governing business activities. As with all UK law, these are set out in legislation or sometimes protected by common law rules which, taken together, ensure certain rights and liberties. Some of these provisions have been in place for many years and will be familiar to business. Like all States we need to continually re-assess whether the current mix is right, what gaps there might be and what improvements we can make.
13.The UK has ratified a series of international treaties and agreements – the International Labour Organisation’s eight core conventions, the International Covenant on Civil and Political Rights, the International Covenant on Economic, Social and Cultural Rights and the European Convention on Human Rights – which enshrine human rights and fundamental freedoms and have been given effect through the law. Currently the Human Rights Act 1998 ensures that individuals in the UK have a remedy for the breach of rights which are protected by the European Convention on Human Rights (ECHR). It applies to all public authorities and other bodies performing public functions, as private companies sometimes do.
14.The relevant legal framework in the UK includes employment regulations that require companies not to discriminate against employees on grounds of sex, race, sexual orientation and religious belief, and environmental regulations. Examples of wide ranging legislation protecting human rights in the business context include the Health and Safety at Work Act 1974, and the Data Protection Act 1998 which applies to companies and ensures respect for the privacy of individuals. Legislation has also been passed to plug specific gaps in the protection of workers under the law such as the Gangmasters (Licensing) Act 2004, which created an agency to prevent the exploitation of workers in agricultural work, shellfish-gathering and related processing or packaging.
15.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 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 (see paragraph 19 below);
- 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 Act was revised in October 2013 to ensure that directors of quoted companies consider human rights issues when making their annual strategic reports
- The Government exercises controls on the export of “strategic” goods and technology through the export licensing system. All export licence applications are rigorously assessed against the Consolidated EU and National Arms Export Licensing Criteria. These assessments take full account of possible human rights impacts; a licence would not be granted if we judge there is a clear risk that the proposed export might be used for internal repression.
Actions taken [page 9]
17. To give effect to the UN Guiding Principles, the Government has: (…)
(i) introduced the Modern Slavery Act which consolidates and simplifies existing legislation, toughened penalties to allow a maximum sentence of life imprisonment, and provides safeguards for victims. Companies covered by the Act are required to produce a “slavery and human trafficking” statement for each financial year setting out what steps they have taken to ensure that slavery and human trafficking is not taking place in its business and supply chains. The Act, which entered into force on 31 July 2015, also created an Independent AntiSlavery Commissioner.
(ii) implemented the requirements of the OECD 2012 Common Approaches, an considered relevant adverse project-related human rights impacts in providing applicable Export Credit Agency (ECA) support through UK Export Finance(UKEF). UKEF will consider any reports made publicly available by the UK National Contact Point (NCP) in respect of the human rights record of a company when considering a project for export credit. The UK has been involved with the discussions, and negotiations, on the implementation of the OECD 2012 Common Approaches and the need to amend this, in respect of ongoing experience on project-related human rights. The UK continues to be involved in negotiations on any agreed clarifications to the OECD 2012 Common Approaches.
(iii) taken account of business activity in conflict and fragile states, or countries with high levels of criminal violence, within the Building Stability Overseas Strategy. Companies operating in these difficult environments have an important role to play in contributing to stability, growth, development, prosperity and the protection of human rights. We support the implementation of the OECD Risk Awareness Tool for Multinational Enterprises in Weak Governance Zones. We will continue to promote implementation of the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict Affected and High-Risk Areas. The Government will also work with EU partners and other like-minded countries to deliver increased effectiveness of the Kimberley Process Certification Scheme and higher standards of responsible sourcing in the global diamond supply chain.
(iv) in March 2015 the Government concluded its chairmanship of the Voluntary Principles Initiative. During our chairmanship we worked to raise awareness of the VPI in priority countries for membership, to support UK oil, gas and mining companies to use the VPs to manage security and human rights risks more effectively, and encouraged greater openness by companies in line with the UN Guiding Principles on Business and Human Rights. More detail on our chairmanship year can be found in our 2014 annual report.
(v) in 2015, the ISO 28007 maritime standard and ISO 18788 land standard for Private Security Companies were published. The UK Accreditation Service (UKAS) conducted a pilot certification process and has issued guidance for certifying bodies for ISO28007, including on human rights. UKAS will also issue guidance on ISO18788.
(vi) supported the UN Working Group on the issue of human rights and transnational corporations and other business enterprises in their role to promote uptake of the UNGPs and develop guidance and best practice.
(vii) invested around £1.5 million from the FCO’s Human Rights and Democracy Programme in projects promoting the UNGPs and supporting business and human rights.
(viii) developed partnerships with other countries seeking to implement the UNGPs. We have a strong collaborative partnership with the Government of Colombia, and supported the development of their National Action Plan, the first published by a non-EU state. We have advised and encouraged the development of National Action Plans in Malaysia, South Korea and with a number of EU partners. We held events to promote the UNGPs in Geneva, Washington, Stockholm, Mexico City and Bogota, and have spoken in support of national processes in Dublin, Madrid, Brussels and Brasilia.
(ix) strengthened international rules relating to digital surveillance, including leading work in the Wassenaar Arrangement to adopt new controls on specific technologies of concern. Specifically new controls were agreed on:
– equipment and software for creating and delivering “intrusion software”
designed to be covertly installed on devices to extract data.
– “internet surveillance systems” which can monitor and analyse internet traffic
and extract information about individuals and their communications.
(x) continued to promote the Government’s “Business and Human Rights Toolkit and developed new resources and training for FCO and UK TIstaff, trade envoys and visiting delegations.
Government commitments [page 10]
18. The Government will do the following to reinforce its implementation of its commitments under Pillar 1 of the UNGPs:
(i) Continue to support the implementation of the UNGPs in other countries, including through the development of National Action Plans. This will create certainty, a level-playing field and a positive environment for UK business. We will lobby foreign states, including through ministerial contact and our embassies and high commissions, to support widespread international implementation of the UNGPs and other relevant international instruments including the ILO’s Fundamental Principles and Rights at Work and the eight core Conventions which embody them, and the OECD Guidelines for Multinational Enterprises.
(ii) Work with EU partners to implement the UNGPs across member states and internationally, starting with the undertaking made by member states to develop their own national plans.
(iii) Continue to ensure that UK Government procurement rules allow for human rights-related matters to be reflected in the procurement of public goods, works and services, taking into account the 2014 EU Public Procurement Directives and Crown Commercial Service guidance on compliance with wider international obligations when letting public contracts. In addition, UK public bodies are required to have due regard for equality-related issues in their procurement activity.
(iv) Work with government, industry and civil society members of the International Code of Conduct Association to establish an international mechanism to monitor compliance with the Code. This will take the form of (i)certification against the Code, (ii) monitoring by the Association, and (iii) a complaints process. We continue to engage with government and non-state clients to promote the Code and the Association.
(v) Continue to work closely with Voluntary Principles on Security and HumanRights Initiative (VPI) member governments, extractive companies and civil society organisations, to promote greater understanding of the Voluntary Principles and strengthen the implementation, effectiveness and membership. To maintain the momentum from our chairmanship March 2014-March 2015, we will continue to work on better corporate implementation of the Voluntary Principles on the ground. This includes maintaining dialogues with ‘host’ governments. For example, we have worked with the Government of Angola to promote the Voluntary Principles to the participating governments of the Kimberley Process Certification Scheme.
(vi) Consider new project activity on raising awareness and tackling the negative impacts of business activity, including on the human rights of groups like indigenous peoples, women, national or ethnic minorities, religious and linguistic minorities, children, persons with disabilities, and migrant workers and their families, by tasking our diplomatic missions in countries where these are concerns.
(vii) Support the EU commitment to consider the possible human rights impacts of free trade agreements, including where these include investment protection provisions, and take appropriate steps including through the incorporation of human rights clauses as appropriate.
(viii) Continue to work through our embassies and high commissions to support human rights defenders working on issues related to business and human rights in line with EU Guidelines on human rights defenders
Modern Slavery Act [pages 11-12]
It is estimated that there are between 10,000-13,000 potential victims of modern slavery in the UK alone. Globally, the ILO estimates the total illegal profit made from the use of forced labour amounts to more than $150 billion a year. The UK Government is committed to tackling this heinous crime and as a response the Modern Slavery Act came into force on 31July 2015. It makes the penalties for those who perpetrate Modern Slavery simpler and tougher and provides help for victims, including through a statutory defence for victims of modern slavery who are forced to commit some offences as a direct consequence of their slavery. It also created an Independent Anti-Slavery Commissioner whose work is expected to lead to an increase in investigations and convictions. His work will also look at the countries of origin for victims of slavery and recommend measures to address the problem at source. The Act is supported by a Modern Slavery Strategy, published in November 2014 and guidance for companies on eliminating slavery through increased transparency in supply chains, published in October 2015.
The collapse of Rana Plaza, in 2013, a building housing a number of commercial ventures including several garment factories, shocked the world and the implications still continue to reverberate over two years later. Over 1,100 people were killed and many more were injured. For the victims and their families the events that unfolded on that day have irrevocably affected their lives. Following the collapse, the British High Commission in Dhaka alongside DFID Bangladesh, have done a number of things to support the victims and try and ensure a disaster like this never happens again.
- DFID Bangladesh, in partnership with Canada and the Netherlands, will provide a total of £7.4m to improve building safety and working conditions, empower workers and urge buyers to take responsibility for their supply chains.
- To date over 1000 structural, fire and electrical safety inspections have been carried out, nearly 200 new inspectors recruited and 299 survivors trained to enable them to find alternative jobs or start small businesses.
- 144 senior masters have been trained in health and safety, who will in turn train 7,600 supervisors that will themselves train over 300,000 workers.
DFID Bangladesh funding has also worked to try and ensure justice for garment workers, supporting a number of NGOs to file public interest litigation to protect workers’ rights, and increase awareness of worker rights. To support this, in 2015 the British High Commission began work with Global Rights Compliance and Action Aid Bangladesh to increase state, corporate, trade associations and trade union understanding and uptake of the UN Guiding Principles, increase accountability and reduce human rights violations in the garment, leather and tannery sectors.
The Nairobi Process: A Pact for Responsible Business
Kenya has recently granted 47 oil and gas exploration licences. This has raised expectations of economic benefits by government, business and local communities. Experience elsewhere in Africa suggests that if the licences are not managed carefully then competing expectations of these actors can lead to community tensions and security risks. The Human Rights and Democracy Programme (2013/14) funded the Nairobi Process: A Pact for Responsible Business – an initiative developed by the Institute for Human Rights and Business (IHRB) in collaboration with the Kenya National Commission on Human Rights (KNCHR). It aims to embed the UN Guiding Principles on Business and Human Rights in the extractives sector in Kenya. It focused on several strands of engagement, including bringing together multinational and national extractive companies, government and civil society and communities to collaboratively address key areas of human rights concern. It also supports business to business learning, capacity building for National Human Rights Institutions in the region and advocates for the implementation of the UNGPs by the government of Kenya.
Support for Land Tenure and other Property Rights
The UK Government is committed to supporting the Voluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries and Forests in the Context of National Food Security (Land Guidelines, VGGT) including through commitments to accelerate VGGT implementation during its G8 Presidency in 2013.
The UK supports the VGGT:
- Through its funding to the Food and Agriculture Organisation in a three-year programme for £4.9 million to raise awareness, improve tenure governance, and support global reporting on progress with VGGT implementation;
- Through its leadership in the 2013 G7 commitment to implement the VGGT through country partnerships with interested governments. These partnerships aim to accelerate and target support to countries’ existing land governance programmes in conjunction with businesses, in particular farmers, and civil society;
- The global donor working group on land chaired by the UK (DFID) in its inaugural year has published a global land programme database and map. The database includes an initial 589 programmes in 127 countries with a combined worth of US$4.9 billion. All programmes are mapped against relevant sections of the human rights based VGGT;
- Jointly with US, Germany, France, the AU Land Policy Initiative and FAO, the UK has developed a land investment due diligence framework based on the VGGT and other international standards, to guide private sector investments under the New Alliance for Food Security and Nutrition.
- In 2015, under the German Presidency, the UK joined a new G7 commitment to align all its Overseas Development Assistance-supported investments with the VGGT. This is being taken forward over the coming years.
- DFID is increasing its work on land, bilaterally and at the global level (for an overview of what we do to drive responsible land investments by the private sector, see our 2nd Land Policy Bulletin 1.
2. Government’s expectations of business
Actions taken to support business implementation of the UNGPs [pages 15-19]
24. To help businesses to fulfil their responsibility to respect human rights the Government has:
i. updated this action plan, setting out the Government’s actions and expectations on business and human rights. We will seek clear and consistent communication of this policy through ministers, UK business ambassadors and officials who engage with business and other appropriate channels.
ii. provided guidance to companies on transparency in supply chains and implementing the reporting requirement in the Modern Slavery Act 2015. https://www.gov.uk/government/publications/transparency-insupply-chains-a-practical-guide
iii.partnered with the Cyber Growth Partnership industry guidance on assessing human rights risks relating to cyber security exports, with techUK and input from civil society. https://www.techuk.org/images/CGP_Docs/Assessing_Cyber_Security_Ex port_Risks_website_FINAL_3.pdf
iv.provided funding to the Corporate Human Rights Benchmark Initiative, the first wide scale project to rank companies on their human rights performance.. http://business-humanrights.org/en/corporate-human-rightsbenchmark
v. supported the UNGPs Reporting Framework, the world’s first comprehensive guidance for companies to report on how they respect human rights. http://www.ungpreporting.org/
vi.provided funding for the Economist Intelligence Unit research report on business leadership attitudes to and actions on the corporate responsibility to respect human rights. http://www.economistinsights.com/businessstrategy/analysis/road-principles-practice
vii.continued to update and promote the joint FCO-UKTI Overseas Business Risk (OBR) service, which provides information about business environments in the countries where UK Trade and Investment (UKTI) has a presence, to ensure it includes specific country human rights information and links to the UNGPs and other relevant tools and guidance. http://www.ukti.gov.uk/export/howwehelp/overseasbusinessrisk/countries.html
viii.continued to provide financial support to the UN Global Compact, a global mechanism that encourages and enables companies to align their operations and strategies with ten universally accepted principles in the area of human rights, labour, environment and anti-corruption.
25. The Government will continue to encourage UK companies in their work to respect human rights. We will:
i. provide support to Board Directors on human rights reporting and practical guidance for companies in the care and security sectors in the UK, through Equality and Human Rights Commission funded projects.
ii.ensure the provisions of an EU Directive on non-financial disclosure are transposed in the UK to enable greater consistency and comparability of public information on the human rights policies and performance of listed companies in Europe.
iii. facilitate dialogue between business people, parliamentarians and civil society on the implementation of the business and human rights agenda as requested.
iv. instruct our diplomatic missions to work with host governments, local and UK business, trade unions, NGOs, human rights defenders, academics, lawyers and other local experts so we can help inform companies of the human rights risks they face.
v. instruct our diplomatic missions to raise with local authorities our concerns in situations where companies have problems implementing their human rights responsibilities because local law is incompatible with international human rights law.
BOX: “UNGPs Reporting Framework + Unilever human rights report
The FCO’s Human Rights and Democracy Fund supported Shift to develop the UN Guiding Principles Reporting Framework. This is the first comprehensive guidance for companies to report on human rights issues in line with their responsibility to respect human rights. In today’s ever more transparent world, companies are under increasing pressure to show that they respect human rights throughout their operations and value chains. There is increasing demand for greater formal reporting by companies on their human rights performance, including from regulations such as the EU non-financial reporting directive and the UK’s Companies Act and Modern Slavery Act reporting requirements.
The UNGPs Reporting Framework provides companies clear and straightforward guidance on how to answer these questions with relevant and meaningful information about their human rights policies, processes and performance. We are pleased to see UK companies at the forefront of best practice in reporting on human rights. Unilever became the first adopter of the Framework when they published their groundbreaking human rights report in July 2015.”
BOX: “EHRC Projects – practical guidance for care/ security sectors and Board Directors/ reporting
The Commission is working in partnership with the Financial Reporting Council and Shift to publish guidance early in 2016 to help company boards to understand what they are expected to know, do and say about human rights. It will provide company boards with smart questions to ask of the business, help them to understand how human rights risks align with business risk, and bring clarity and coherence to different human rights reporting requirements.
The Commission is working with the Institute of Human Rights and Business to publish guidance in early 2016 for UK businesses in the care and private security sectors. The guidance will include an assessment of the main human rights impacts in each sector and practical guidance for managers in areas such as human resources, operational delivery and procurement.”
BOX: Corporate Human Rights Benchmark Initiative
The UK provided support and start up funding to the Corporate Human Rights Benchmark. This initiative is established by a multi-stakeholder group led by Aviva Investors. It aims to rank the top 500 globally listed companies on their human rights policies, processes and performance, to harness the competitive nature of the markets to drive better corporate human rights performance.
It is based on the premise that improved business transparency combined with public rankings of companies’ performance can help to drive a race to the top. It aims to provide investors with information to direct investments to companies respecting human rights, business with the incentive to make information publicly available, customers with the knowledge to make well-informed choices and policy makers with an objective means to focus on those companies and business sectors that have the greatest human rights impacts.
BOX: Cyber Export Guidance
The expansion of ‘cyber space’ has brought huge economic and social benefits. However, it also poses risks and new opportunities for hackers, criminals and terrorists. To help mitigate these risks, companies have developed security products and services which defend networks from malicious activity. In many countries, such as the UK, these products are used legitimately, including by law enforcement authorities, in accordance with domestic and international law obligations. However, in some countries which do not adhere to their international human rights obligations, there is a risk that the same products are used in ways that could breach state’s legal obligations, e.g. to restrict freedom of expression or to contribute to internal repression.
Normally, exports that could cause harm, such as arms, are covered by the export licensing regime. However, many cyber capabilities, products and services are not listed. This problem was recognized by the Cyber Growth Partnership a joint body representing industry, academia and government. The FCO worked with techUK, a technology trade association, and the Institute for Human Rights and Business to produce practical guidance for companies on managing human rights risks.
“Assessing Cyber Security Export Risks: Human Rights and National Security” was published in November 2014. It is the first guidance for this sector in the world, and sets out:
- the different sorts of potential harm associated with particular cyber capabilities;
- a process to help companies assess country specific risks and to evaluate business partners and re-sellers; and
- potential mitigation options for avoiding or reducing risks.
BOX: Myanmar Centre for Responsible Business in Burma
The UK’s trail-blazing funding to the Myanmar Centre for Responsible Business in Burma (MCRB) helped create a resource hub that is now well-established and well respected, with financial support from a number of countries.
MCRB’s reputation as a knowledgeable and neutral source of information on responsible business has grown with all its stakeholders. This has led to more requests for advice from companies from an increasingly wide range of nationalities and sector. MCRB has played an important role in regulatory advocacy, offering proposals drawing on what it knows of business and CSO experience and interests, as well as international standards
Local civil society organisations have come to understand the value of MCRB as a knowledge and training resource for them but also as a conduit to business and an amplifier of their concerns. The media has turned to MCRB for comments on a range of responsible business issues which MCRB is using to shape debates on issues as diverse as tax evasion and environmental impacts, and to highlight international standards and key issues in Myanmar
4. UK Action Plan implementation and further development [page 24]
“32. 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 National Action Plan
Leading by Example
Outcome 1.1: Promoting RBC Globally [page 8-9]
OECD Guidelines for Multinational Enterprises: For the first time, in 2016 the U.S. National Contact Point (USNCP) for the OECD Guidelines published an annual report and in 2017 will develop an outreach plan to continue its efforts to broaden understanding and implementation of the OECD Guidelines among business. The USNCP will help organise two workshops related to the OECD’s work. Implementing Agency or Department: State
UN Guiding Principles on Business and Human Rights: In addition to funding efforts that promote awareness and implementation of the UN Guiding Principles, the U.S. government, through State, will continue to disseminate the UN Guiding Principles through our bilateral, multilateral, and public diplomacy efforts. State will continue to participate in and host discussions with companies, civil society groups, and others on these Guiding Principles, including through its on-going UN Guiding Principles Workshop Series. The most recent workshop in the series focused on the relevance of human rights and the application of the UN Guiding Principles framework to the selection of sites, preparations for, and activities related to large-scale, global sporting events. Implementing Agency or Department: State
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 organisations. 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 Agency or Department: State, USAID
Outcome 1.2 Utilise US Law, Multilateral Agreements, and Diplomacy to Promote and Enforce High Standards
Ongoing commitments and initiatives
Robust and Consistent Enforcement of U.S. Laws and Regulations: The U.S. government will protect the integrity of our financial system and combat money laundering and financial crimes by continuing to enforce its laws in order to protect human, labor, and civil rights. Laws whose enforcement advances key priorities relevant to RBC include those listed in Annex II. Implementing Department or Agency: DOJ, Treasury
Executive Orders and Regulations that Set Global Standards: DOL will continue to vigorously enforce new and existing protections for job applicants and workers of federal contractors, including those who are based outside of the United States. See Annex II for policies promoted by E.O.s that impact the responsible conduct of foreign companies that do business with the U.S. government. Implementing Department or Agency: DOJ, State
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/. Implementing Department or Agency: Treasury
Collaborating with Stakeholders
Outcome 2.1 Enhance the value of Multi-stakeholder Initiatives on RBC [page 14-16]
Enhancing the Value of MSIs: The U.S. government will establish a formal mechanism for facilitating coordination among agencies engaged in relevant MSIs, in order to establish common approaches and expectations, share relevant experiences and good practices, and explore synergies. The U.S. government will continue to play a leadership role in promoting and improving the value and relevance of key MSIs, especially those in which it participates formally. Implementing Department or Agency: State
Promoting Worker Voice throughout Global Supply Chains: DOL, State, and USAID will promote worker voice and empowerment throughout global supply chains and will commit to: (1) building innovative tools to empower workers to directly report to relevant Departments concerns in federal supply chains; and (2) leverage public-private partnerships, stakeholder engagement, and labor diplomacy to promote worker empowerment throughout global supply chains. This effort will enhance the visibility of workers’ perspectives and of their representative organisations, and promote the ability of workers to organise. Various U.S. government agencies have funded and/or participated in initiatives to support stronger worker voice, such as through the Partnership for Freedom and the Supply Unchained initiatives. Implementing Department or Agency: DOL, State, USAID
Promoting Best Practices for Key Performance Indicators (KPIs): The U.S. government will convene stakeholders to discuss the development and promotion of effective metrics, including KPIs, for measuring and managing labor rights impacts in supply chains. This will be done in collaboration with industry groups, auditing organisations, worker organisations, and other civil society actors. Implementing Department or Agency: DOL
Promoting Rights and Accountability through RBC: In May 2016, USAID launched anew Broad Agency Announcement calling for organisations 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
Wildlife Crime Tech Challenge: USAID’s Wildlife Crime Tech Challenge recently selected sixteen Prize Winners and four Grand Prize Winners who submitted the most creative, innovative, and promising science and technology solutions to combat terrestrial and marine wildlife crime, with a focus on combating corruption and reducing consumer demand for illegal wildlife products. Grand Prize Winner New England Aquarium’s solution will digitise customs paperwork and conduct real-time analysis to identify illegal wildlife products hidden in legitimate trade. The National Whistleblower Center, another Grand Prize Winner, will build a secure, transnational reporting system designed to fight corruption by incentivising insiders to securely report wildlife crime. Implementing Department or Agency: USAID
Ongoing commitments and initiatives
Open Government Partnership (OGP): In 2011, President Obama joined seven other heads of state to launch the OGP, a global platform between governments and civil society to promote government transparency, participation, and accountability to citizens. By June 2016, OGP had grown to 70 member states that have made over 2,500 commitments to further government transparency and accountability in just five years. OGP member states — and hundreds of civil society leaders — are committed to working together to promote transparency, empower citizens and civil society, fight corruption, and transform how governments deliver services for their citizens. The United States has released three NAPs under OGP, most recently publishing an update to its third action plan this past September. In demonstration of U.S. commitment to OGP, the USG intends to provide $4 million to support the OGP Support Unit over the next four years, potentially including support to members in the development of National Action Plans, government and civil society consultations, peer learning and exchange, and technical assistance programs. In addition, USAID Missions have financed millions of dollars-worth of OGP-related activities — $14 million in FY2015 alone — ranging from sponsoring citizen consultations, to coordinating OGP workshops with senior government officials, to providing technical assistance with implementation of OGP NAP commitments. Implementing Department or Agency: State, USAID
ILO-International Finance Corporation (IFC) Better Work Program: More than 60 American apparel brands are part of the Better Work program, implemented by the ILO in partnership with the IFC. DOL has funded Better Work programs in Bangladesh, Cambodia, Haiti, Jordan, Lesotho, Nicaragua, and Vietnam. The Better Work program is being implemented in 1,343 export apparel factories, supporting better labor conditions for approximately 1,750,000 workers worldwide. Implementing Department or Agency: DOL
DOL Technical Cooperation: DOL funds a range of projects involving collaboration with private sector actors on RBC issues, including:
- A $12 million project, From Protocol to Practice: Building a Bridge to Global Action on Forced Labor, supports global and national efforts pursuant to the 2014 ILO Protocol and Recommendation on Forced Labor. Among other things, this project will organize a global supply-chain forum focused on the role of business in addressing forced labor.
- A $6 million DOL project in Brazil and Peru, launched in March 2014, partners with national governments, businesses, and civil society organisations to combat forced labor and promote the exchange of good practices between the two countries. In Brazil, the project partners with the state of Mato Grosso’s Integrated Action Program to provide livelihood opportunities to households vulnerable to forced labor. In Peru, the project has conducted research on forced labor in gold mining and logging and trained more than 1,000 government officials on the issue of forced labor. Implementing Department or Agency: DOL
Engagement with International Cocoa and Chocolate Industry: As the Secretariat for the Child Labor Cocoa Coordinating Group (CLCCG), DOL plays a leadership role in facilitating coordination among the Governments of Côte d’Ivoire, Ghana, and the United States and the international chocolate and cocoa industry (including six major producing companies) to address the worst forms of child labor in cocoa growing areas of Côte d’Ivoire and Ghana. CLCCG members held their annual meeting in June 2016 at DOL to discuss new project funding and other initiatives. Implementing Department or Agency: DOL
Partnership for Freedom: The U.S. government has provided funding and technical assistance for the Partnership for Freedom, a public-private partnership among NGO Humanity United and DOJ, State, DOL, and the Departments of Health and Human Services (HHS), and Housing and Urban Development (HUD). Under the second of three challenge competitions, federal agency participants committed to providing outreach and disseminating information to potential applicants for financial support from Humanity United, and to contributing technical expertise to “challenge competition” awardees that have developed technological solutions to identify and address labor trafficking in global supply chains. Implementing Department or Agency: DOJ, State, DOL, HHS, HUD
Burma Labor Law Initiative: The Initiative to Promote Fundamental Labor Rights and Practices in Myanmar, developed by State, DOL, and the Office of the U.S. Trade Representative (USTR), in partnership with Japan, Denmark, the European Union, and State, DOL, USTR -16- the ILO, was launched in 2014 and aims to help modernise Burma’s labor laws in line with international labor standards, build government capacity to administer and enforce labor law, and foster a stronger dialogue among the government, business, labor, and civil society. The parties met for a two-day stakeholder forum in Yangon in May 2015 and again in September 2016 to advance both the labor law reform and stakeholder dialogue elements of the initiative. Implementing Department or Agency: State, DOL, USTR
Sustainable Development Goals: The 2030 Agenda for the Sustainable Development and its 17 Sustainable Development Goals (SDGs or Global Goals) establish an ambitious framework to make progress on many of the fundamental social, economic, and environmental challenges facing the world over the next 15 years. The U.S. government encourages uptake and implementation of the SDGs and intends to facilitate dialogue among key actors to discuss best practices, public-private partnership opportunities, lessons learned, and action necessary to ensure the SDGs’ success. As part of this initiative, DOL has been actively engaged in the ILO-led Alliance 8.7, a coalition of business and other stakeholders committed to increasing action to achieve SDG Target 8.7 on the elimination of the worst forms of child labor, forced labor, and human trafficking. Implementing Department or Agency: State, Treasury, USAID, DOL
Facilitating RBS by companies [page 17]
The U.S. government encourages businesses to treat tools like the OECD Guidelines and the UN Guiding Principles as a floor rather than a ceiling for implementing responsible business practices, and to recognize that implementing RBC should be a continuing process. The U.S. government is supportive of company efforts to voluntarily report on human rights impacts, anti-trafficking measures, transparency and anti-corruption efforts, and other related aspects of their global operations, including the opportunities and challenges they face. Given the heightened risk of serious human rights impacts in conflict-affected areas, the U.S. government particularly encourages corporate due diligence and reporting under such circumstances.
The U.S. government generates and vets relevant information that can be used to conduct appropriate due diligence and risk assessment. While the concept of due diligence is increasingly well understood and accepted among businesses, the tools and resources available to effectively conduct detailed and appropriate risk and impact assessments can be sparse, particularly in many of the complex environments where this type of data is most needed.
To help address those gaps, the U.S. government deploys significant resources to produce and disseminate a variety of reports that help describe the state of human rights, labor rights, commercial, and investment conditions across the world, and produces international company profiles to provide U.S. companies with information to help them vet potential business partners. In certain instances, the government also funds third-party reports that contain information useful to those seeking to promote and implement RBC. As part of the ongoing effort to facilitate RBC, the U.S. government will continue to enhance these resources, making them increasingly user-friendly and easier to find for the purposes of corporate human rights due diligence and social impact assessment.
Outcome 3.1: U.S. Government Reports
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 Agency or Department: USAID
RBC Online Resource Tool: State will create a repository for U.S. government reports, sorted by country and subject, to make it easy for a business to review all available U.S. government reporting relevant to the operating environment in particular countries.Implementing Agency or Department: USAID
Supporting Voluntary Reporting on RBC: Voluntary reporting on RBC by U.S. companies will help them achieve their RBC goals while promoting RBC more widely and helping to build the U.S. “brand.” State and other agencies will welcome and recognise new methods of reporting in support of RBC and create an online resource to that end. Implementing Agency/Department: State
Ongoing Commitments and Initiatives
DOL Child Labor and Forced Labor Reports: DOL publishes and updates three reports on international child labor and forced labor (the Findings on the Worst Forms of Child Labor, the List of Goods Produced by Child Labor or Forced Labor, and the List of Products Produced by Forced or Indentured Child Labor) that serve as valuable resources for government action, civil society advocacy, and private sector due diligence on these issues. Since 2015, DOL releases these three reports through a new mobile application, Sweat & Toil: Child Labor, Forced Labor, and Human Trafficking Around the World, which streamlines this wealth of information and makes it available on mobile devices. DOL regularly engages with companies and industry groups on how they can use these tools to strengthen their social compliance programs. Implementing Agency/Department: DOL
Human Rights Reports: State will continue to publish its annual Human Rights Reports, which cover internationally recognised individual, civil, political, and worker rights, as set forth in the Universal Declaration of Human Rights and international agreements. Implementing Agency/Department: State
Trafficking in Persons (TIP) Report: State will continue to use the TIP Report to engage foreign governments in dialogues to combat trafficking, advance anti-trafficking reforms, and to target resources on prevention, protection, and prosecution programs. Implementing Agency/Department: State
Reducing Child Labor and Forced Labor: A Toolkit for Responsible Businesses: This DOL online resource, launched in December 2012, will continue to provide step-by-step guidance to businesses that seek to develop and improve social compliance systems to address child labor and forced labor in supply chains. The Toolkit is available to the public in English, Spanish, French, and Portuguese and will be regularly updated based on feedback from users. Implementing Agency/Department: DOL
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 Agency/Department: State
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 Agency/Department: State
Country Commercial Guides: Commerce will continue to include an anti-corruption section in U.S. and Foreign Commercial Service Country Commercial Guides. Implementing Agency or Department: 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 Agency/Department: State, DOJ, SEC, Commerce
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 Agency/Department: State, Treasury
Outcome 3.3: Capacity Building and Technical Support to Promote Enabling Environments [pages 19-21]
Responsible Land-Based Investment: USAID will support responsible land-based investment by helping the private sector pilot the Analytical Framework for Land-Based Investments in African Agriculture, which are internationally accepted guidance that helps companies mitigate land tenure risks and make their investments more inclusive, responsible, and sustainable. This commitment will provide limited financial assistance, as well as technical assistance, to help first mover companies implement the guidance and make their investments more responsible and inclusive of local communities, including indigenous peoples. USAID will coordinate closely with other G-7 governments and the New Alliance for Food Security and Nutrition. Implementing agency or department: USAID
Support for Reducing Land Conflict in West Africa: State is supporting a program to reduce land conflict in Sierra Leone, Liberia, and Guinea by strengthening the capacity of civil society organisations to work on land rights and tenure issues as they relate to the UN Guiding Principles on Business and Human Rights. This program complements USAID’s existing investments in Côte d’Ivoire to support responsible business practices in the process of diamond sourcing, support country compliance with the Kimberley Process Certification Scheme, and stem the flow of conflict diamonds, while improving community land rights. Implementing Agency or Department: State
Stakeholder Engagement in Extractive Industries in East Africa: State is funding a program to promote RBC in East Africa. The goal of the program is to strengthen civil society’s capacity to meaningfully participate in business and human rights initiatives in East Africa and to reduce conflict for communities in the operations of extractive companies. Implementing Agency or Department: USDA, DHS.
Ongoing commitments and initiatives
Raising TIP Awareness in the Agricultural Sector: The Department of Agriculture (USDA) will continue to work with DHS’s Blue Campaign to develop food and agriculture-focused materials to raise awareness of human trafficking with industry partners and will engage with HHS to increase awareness of trafficking in USDA StrikeForce states across the country that may be particularly susceptible to trafficking due to extreme poverty. The StrikeForce teams collaborate with more than 500 community partners across 20 states to address rural poverty. Implementing Agency or Department: USDA, DHS
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 Agency or Department: DOJ, SEC, State, Commerce
Dodd-Frank Section 1502: Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) supports regional and international efforts to break the link between conflict and natural resources and prevent armed groups or abusive state forces in the African Great Lakes region from benefiting from the sale of certain natural resources that are sourced from the Democratic Republic of the Congo (DRC) or an adjoining country. Section 1502 requires certain companies to submit annually a description of the measures taken to exercise due diligence on the source and chain of custody of the four “conflict minerals.” Commerce will continue to work with the U.S. Geological Survey to issue annually a list of conflict mineral processing facilities to assist in this reporting and will develop recommendations on ways to improve accuracy and establish standards of best practices. State will continue to provide guidance to help companies ensure that their products and their suppliers’ products do not directly or indirectly finance armed conflict or result in labor or human rights violations. Through the Public-Private Alliance for Responsible Minerals Trade, State and USAID work in partnership with U.S. companies and civil society to support conflict-free sourcing from the DRC and African Great Lakes region. Implementing Agency or Department: State, USAID, SEC, Commerce, USGS
Eliminating Child and Forced Labor in Agricultural Supply Chains: In 2011, USDA, DOL, and State released the Guidelines for Eliminating Child and Forced Labor in Agricultural Supply Chains, developed as part of a multi-stakeholder process that included high-level officials of these agencies, representatives of business, civil society, and academics. The Guidelines’ specific elements should be integrated into any agricultural company program to reduce child or forced labor, and include adhering to ILO standards on child labor and forced labor; mapping supply chains and conducting risk assessments; providing communication and monitoring mechanisms; and developing plans and programs for remediating violations. DOL is now funding a four-year pilot project in Turkey to test implementation of the above Guidelines by a leading company. Implementing Agency or Department: USDA, DOL, State
Massive Open Online Course (MOOC) on Land Tenure and Property Rights: USAID successfully developed and led a MOOC on Land Tenure and Property Rights in 2015. The university-level course was free and open to the public. Almost 2,000 participants from more than 60 countries participated in the 14-week course, which features lectures and case studies from a wide variety of experts in the field. A second Land Tenure and Property Rights MOOC will launch in 2017 with expanded lessons on responsible land tenure activities within USAID’s program cycle, utilising geospatial analytics and data for evidence-based programming, and the importance of understanding and supporting customary tenure in development programming. Implementing Agency/Department: USAID
International Law Enforcement Academy (ILEA) Program: Department of State’s Bureau of International Narcotics and Law Enforcement Affairs (INL) operates five ILEAs around the world. ILEA facilities are in Botswana, El Salvador, Hungary, Thailand, and Roswell, NM. ILEA also operates an affiliated Regional Training Center in Ghana. State coordinates the input of 16 U.S. federal law enforcement agencies and selects state and local partners to develop and deliver training to officers from 85 countries around the world. Courses cover a variety of topics including trafficking in persons, wildlife trafficking, counter-narcotics investigations, financial crimes, and money laundering; ILEAs also offer a six-week course on Law Enforcement and Leadership Development. The program builds criminal justice sector capacity in partner countries, develops operational relationships within key regions, and forges key relationships with the U.S. law enforcement community. Approximately 140 courses are offered through the ILEA program each year, reaching nearly 4,500 officers. Implementing Agency or Department: State
Financial Action Task Force (FATF): The United States is a founding member of the FATF and will continue to be actively involved in advancing the FATF’s global efforts in combating money laundering, terrorist financing, and other illicit financing threats that pose a risk to the integrity of the international financial system. The United States recently underwent a Mutual Evaluation Review to assess levels of implementation of the FATF Recommendations. Implementing Agency or Department: Treasury
Combating Illegal Logging and Wildlife Trafficking: Through its Environment and Natural Resources Division, DOJ partners with the Department of the Interior’s U.S. Fish and Wildlife Service and USDA’s Forest Service with the support of State and USAID to provide capacity-building training for investigators, prosecutors, and judges in other countries to prosecute illegal logging and wildlife trafficking cases. DOJ will continue to work to build the capacity of enforcement officials in other countries so they are better able to address these crimes in the countries of origin. In 2016, DOJ provided training to six southern African and five west African countries on wildlife trafficking, and in Colombia, Peru, and Cameroon (for four Congo Basin countries) on illegal logging. DHS will continue to investigate illegal logging and wildlife trafficking cases and work closely with DOJ to prosecute violators. Implementing Agency orDepartment: DOJ, DOI, USAID, State, DHS
Combating Cultural Property Looting and Smuggling
Through its Criminal Division and the Environment and Natural Resources Division, DOJ partners with State, Treasury, Federal Bureau of Investigation (FBI), DHS, and others to coordinate and share information as a part of the Cultural Property Task Force and also works with foreign law enforcement partners to investigate and prosecute individuals involved in the illegal looting, sale, and smuggling of cultural property (including international antiquities and U.S. Native American artifacts). DOJ will continue to participate in the Cultural Property Task Force and coordinate with international law enforcement partners to investigate and prosecute cases.Implementing Agency/Department: State, Treasury
Recognising Positive Performance [page 22]
U.S. companies make tremendous contributions to societies around the world by generating economic growth, creating jobs, spurring innovation, and providing solutions to pressing challenges such as access to clean energy, healthcare, and technology. As the U.S. government seeks to promote RBC tools and best practices, it is important to recognise and highlight when companies achieve high standards and put these tools into action, with meaningful results for workers, communities, and the company itself. U.S. government agencies recognise specific companies that maintain high standards or have positive development impacts. Rewarding activities helps affirm and draw attention to the significant efforts of deserving companies, and serves to reinforce how the U.S. government and U.S. firms work together to leverage comparative advantages to accomplish shared objectives, whether it be in environmental sustainability, labor rights and human rights, or anti-corruption measures.
Outcome 4.1: Recognise RBC Best Practices
Human Rights in the ICT Sector: The impact and importance of business conduct in the ICT sector has grown as social, commercial, educational, and recreational interactions increasingly take place online. State, working with other agencies and stakeholders, will develop a regular mechanism to identify, document, and publicise lessons learned and best practices related to corporate actions that promote and protect human rights online. State will also foster continued engagement among relevant stakeholders to support ongoing dialogue and collaboration on respecting human rights within the ICT sector. Implementing Department or Agency: State
Modernise the Secretary of State’s Award for Corporate Excellence (ACE): For 17 years the ACE has recognised 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
Ongoing commitments and initiatives
DOL Iqbal Masih Award for the Elimination of Child Labor: The Iqbal Masih Award is a non-monetary award presented annually by the U.S. Secretary of Labor to recognise the exceptional efforts made by an individual, company, organisation, or national government to reduce the worst forms of child labor internationally. DOL will continue to consider outstanding private sector efforts for this award. Implementing Agency or Department: DOL
Annex II: Key Domestic Executive Orders and Regulatory Efforts [pages 26-29]
The Executive Orders and regulations listed below are examples of U.S. government actions designed to lead by example and help promote the responsible conduct of businesses operating in the United States and abroad.”
““Strengthening Protections against Trafficking in Persons in Federal Contracts” (E.O. 13627), signed on September 25, 2012, and its associated regulatory changes, created new prohibitions on trafficking and trafficking-related activities in federal supply chains to identify and prevent human trafficking in global supply chains. E.O. 13627 also mandated compliance plans for federal contracts performed overseas and exceeding $500,000 in value.
Non-Retaliation for Disclosure of Compensation Information” (E.O. 13665) and an implementing final rule prohibit covered federal contractors and subcontractors from discriminating against employees and job applicants who choose to inquire about, discuss, or disclose their own compensation or the compensation of another employee or applicant. The E.O. modifies a prior Order (E.O. 11246).
“Further Amendments to Executive Order 11478, Equal Employment Opportunity in the Federal Government, and Executive Order 11246, Equal Employment Opportunity” (E.O. 13672) prohibits covered Federal contractors and subcontractors from discriminating against employees and job applicants employmenton the basisofsexualorientation, and gender identity. The E.O. modifies a prior order (E.O. 11246), which prohibited employment discrimination by companies doing business with the Federal Government on the bases of race, color, religion, sex and national origin and required those companies to take affirmative steps to ensure nondiscrimination on those grounds.
“Establishing Paid Sick Leave for Federal Contractors” (E.O. 13706) and an implementing rule require certain employers that contract with the Federal Government to provide their employees with up to seven days of paid sick leave annually, including for family care and absences resulting from domestic violence, sexual assault, and stalking.
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. -27- 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 victimised 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.
The Trafficking Victims Protection Act: The Act (22 U.S.C. § 7103) and its Reauthorizations provide comprehensive tools and direction to combat trafficking in persons both internationally and domestically. The Act also authorized the establishment of the Office to Monitor and Combat
Trafficking in Persons to lead USG diplomatic efforts on trafficking, and the President’s Interagency Task Force to Monitor and Combat Trafficking in Persons to coordinate USG anti-trafficking efforts.
Enforcement of the U.S. Lacey Act: The U.S. government enforces the U.S. Lacey Act’s prohibitions on the trade in fish, wildlife, and plants taken in violation of U.S. and foreign laws. In particular, the U.S. government enforces the Lacey Act against those who illegally trade in wildlife products such as rhino horn and elephant ivory, which is threatening the extinction of these animals. In addition, the U.S. government enforces the Lacey Act to punish those who purchase or trade in timber and wood products when that wood was harvested in violation of the laws of the country of harvest.
Enforcement of the U.S. Act to Prevent Pollution from Ships implementing the International MARPOL Convention: The U.S. government enforces the U.S. Act to Prevent Pollution from Ships, the U.S. law implementing the international marine pollution convention known as MARPOL. Such enforcement actions are brought against shipping companies that illegally discharge waste oil into the ocean rather than legally dispose of it at port.
Combating Impunity for International Human Rights Violations: DOJ’s Human Rights and Special Prosecutions Section investigates and prosecutes international human rights violations using several U.S. statutes, including the War Crimes Act, 18 U.S.C. § 2441, and the Torture Act, 18 U.S.C. §§ 2340-2340A. Under these statutes, perpetrators may be held directly or indirectly responsible for specified war crimes or torture committed abroad, including in the course of conducting business, under the circumstances articulated in the statutes.
The International Emergency Economic Powers Act: The Act (50 U.S.C. §§ 1701, et seq.) authorizes the President to declare a “national emergency” in response to “any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States.” Pursuant to this authority, the President may prohibit certain transactions, including those with a specially-designated global terrorist or specially-designated nationals associated with specified foreign regimes who commit gross human rights abuses. Absent proper license or authorization, violations of such orders, regulations, or prohibitions carry civil and criminal penalties.
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.