I want to thank USAID for sponsoring today’s conversation on Business and Human Rights which I believe to be a critical human rights issue in this day and age. I am honored to be on such an esteemed panel and am very pleased to see many familiar and new faces here today. All of you have helped shape this conversation and many have helped governments, including the U.S. government, come to grips with the challenges and opportunities in this field. Business and human rights is especially important in today’s world where non-governmental actors – whether companies, NGOs or armed extremist groups — have increasing power to do good or ill. And often they are operating outside of government control or even influence.
Traditionally, human rights law has focused on governments – the duty of governments to protect the fundamental human rights of their citizens. But this is no longer enough. The global business community has grown in power and influence, and so must its responsibility for protecting human rights.
Today, half of the world’s 100 largest economies are private companies. The other half are the economies of nations. What this means is that when we measure corporate annual revenues and compare them to the gross domestic product of countries, half of the corporations are as large as nations. If Wal-Mart were a nation, its annual revenues this year would rank it roughly 30th in the world – ahead of Malaysia, Belgium, Nigeria and Sweden. And this isn’t a fluke, it’s a pattern. The Fortune 500 companies have continued to grow despite the global recession.
In this emerging global economy many of the rules of the road have yet to be written. This is a moment in time when smart, thoughtful and creative action by governments, NGOs, and companies is urgently needed.
In terms of human rights, there are four broad areas that deserve greater attention:
• First, manufacturing supply chains and their labor practices;
• Second, security and human rights in zones of armed conflict, especially with respect to the extractive industries;
• Third, labor and other human rights issues in the agricultural sector; and
• Fourth, the role of the private sector with respect to free expression on the Internet.
In each of these areas there is an important role for governments to play, often in close collaboration with companies themselves, but also civil society organizations. Now, governments alone cannot answer all of these challenges or regulate in all of these areas. But we also cannot assume that companies, acting alone, will always do the right thing.
The U. S. government is committed to working with the private sector, civil society, and governments as allies and partners to make human rights a reality, especially in those places where governments struggle to impose rule of law and companies face the difficult task of taking principled actions. So we all must be looking for alternative ways to build new global rules of the road.
As we all know, many corporations operate in some of the toughest territories in the world, in places where the discovery of natural wealth can fuel bitter conflict.
It is not easy for a company to take on responsibility for respecting human rights. But especially in places where governments may be too weak or unwilling to enforce the rule of law and protect individuals’ rights, companies often find themselves acting as the first line in promoting best practices for human rights. It is the job of governments to support companies in making the right choices. One way to do this is by facilitating multi-stakeholder dialogues to identify and address problems inherent in a particular sector or region.
The international community has developed many mechanisms to address business and human rights.
I’d like to recognize the longtime contributions of the UN Secretary General’s Special Representative on Human Rights, Transnational Corporations, and Other Business Enterprises, John Ruggie, who has been a conceptual leader on these issues. At the Human Rights Council session that ended in June, Professor Ruggie presented his final report as Special Representative: The Guiding Principles for the Implementation of the UN Protect, Respect, and Remedy Framework organized around three foundational principles:
• First, the state duty to protect against human rights abuses by third parties, including business;
• Second, the corporate responsibility to respect human rights; and
• Third, the need for victims to have access to remedies.
The Guiding Principles were developed and were embraced by all groups following extensive consultation with government, corporate actors, and a wide range of civil society actors. As a result, they offer a common platform and plan of action for the global community in advancing human rights where they intersect with business.
But, translating his vision into action requires a commitment from companies, governments and civil society to cooperate on the hard issues.
As a government, we now must pursue the crucial next phase- implementation – with diligence, creativity and resources to ensure that we reach our ultimate goal: Improving the lives of people around the world. The Bureau of Democracy, Human Rights, and Labor at the U.S. Department of State is currently exploring how we can support targeted high impact projects to advance John’s work.
We also believe in the potential of multi-stakeholder initiatives as a mechanism to address these tough issues.
It is my experience that companies are much better positioned to address human rights concerns when they work in a multi-stakeholder environment that includes not only other companies, but also civil society, academics, investors, and sometimes governments. This approach is critical because it creates a forum for invested actors to confront evolving human rights challenges, and because it provides a way to demonstrate the value of these processes through an accountability mechanism. Like the Ruggie Framework, these multi-stakeholder initiatives can also fill the void where governments can’t or won’t live up to their duty to protect their citizens.
But for multi-stakeholder initiatives to work, the standards they set must be clear, specific, and backed by a credible monitoring mechanism. The initiatives themselves need sound rules of the road, in the form of a comprehensive governance structure. And they need to be implemented, monitored, verified, and evaluated in a way that is transparent and encourages compliance.
So let me walk you through a few examples of multi-stakeholder initiatives.
The Fair Labor Association is a good example of what can be done. It’s a collaboration between companies, colleges and universities, and civil society organizations, that has been improving working conditions in factories around the world since 1999. The FLA has developed a Workplace Code of Conduct, and created a practical process for monitoring, remediation, and verification and a third-party complaint mechanism. As a result of all of these steps, the FLA has succeeded in strengthening worker protections at hundreds of factories, from Bangladesh to Mexico.
For the past 10 years, the United States and many people in this room have been working together on another initiative, the Voluntary Principles on Security and Human Rights. As you may know, the VPs provides guidance to extractive companies on maintaining the safety and security of their operations in a manner that respects human rights. The VPs are the only human rights guidelines designed specifically for the oil, gas, and mining industries. Because these industries frequently work in areas where central governments are weak and human rights are all too often trampled, this administration is committed to strengthening the VPs to maximize its impact in these tough environments. We are working to create a sound governance structure as well as an external monitoring mechanism, so that it can meet these very real challenges.
And, of course, we continue to work on the urgent crisis over conflict minerals in the Great Lakes region of Africa. As you know, the U.S. Congress has recently passed the Dodd-Frank Wall Street Reform and Consumer Protection Act,
which aims to break the links between the illicit trade in natural resources in the Great Lakes region and the conflict in eastern Democratic Republic of Congo. President Obama signed it into law last year. The law requires companies that use tin, tantalum, tungsten or gold in their products to publicly disclose whether any of those minerals originated in the DRC or an adjoining country. If so, the company must provide a report of the measures taken to exercise due diligence on the source and chain of custody of the minerals, including an independent audit to verify conditions of work in the supply chain. While the law is requires companies to report publicly on their procedures, we hope it will eventually lead to a conflict-free supply chain of minerals from the region.
Another area where we are working is in developing a new International Code of Conduct for Private Security Service Providers. 125 members of industry have all signed on to this Code of Conduct which requires them to respect human rights regarding, among other things, the use of force, detention, torture, sexual exploitation, human trafficking, forced labor and discrimination. We fully support this nascent organization, which is doing its due diligence to set up a strong architecture of accountability and transparency by establishing a robust certification procedure and a credible grievance mechanism.
Finally, I want to talk about an issue that is fundamentally important to the intersection of business and human rights: Internet Freedom.
We urge all companies, U.S. and international, to consider the human rights implications of their actions, and the Internet is of course a critical area of concern these days. Secretary Clinton has put Internet freedom on the map as a key diplomatic priority. At its core Internet freedom concerns a set of human rights — the right of freedom of expression, the right to peaceful assembly, the right to freedom of association. We must consider how these rights apply to new technologies and the steps that governments and business need to take to protect and respect human rights and fundamental freedoms.
By now, every government understands the power of ordinary citizens to harness the Internet and social media to organize and express themselves.
Some have embraced these new technologies as a way to connect with and serve their citizens. Others are redoubling their attempts to control them.
We are witnessing the rise of cyber attacks on the computers of independent media, Distributed Denial of Service attacks on the sites of watchdog groups, and other attempts to thwart the work of civil society.
We are seeing the development of more sophisticated tools for cyber-repression, including filtering, surveillance, anti-circumvention, and network-disabling technologies by government security forces in closed societies.
This is one of those hard problems I spoke of earlier. I don’t have all the answers, and neither does the U.S. government. But I do believe that the multi-stakeholder approach is the right way to discuss and address these emerging challenges.
Thank you very much.