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Regulating the Work of Transnational Corporations

June 25, 2014

This session of the Human Rights Council has seen various discussions surrounding the impact of business on human rights.

A Binding Instrument?

Ecuador, now alongside South Africa, presented a draft resolution on the creation of a legally binding instrument (a treaty) to regulate the work of transnational corporations and other businesses.

During the informal discussions, Member States have been very divided: some delegations, such as the EU and Norway, have unsurprisingly opposed the initiative, stating that the resolution would wipe away years of work that led to the creation of the UN Guiding Principles on Business and Human Rights: Implementing the United Nations ‘Protect, Respect and Remedy’ Framework (Ruggie Guiding Principles). The delegation of the USA, although not present at the discussions, has expressed its concern at the interactive dialogue with the Working Group, saying that a possible new treaty would be too lengthy because every country has different economic models and businesses and a one size-fits-all instrument cannot account for these differences.

In reality, being at a period of elaboration of a new treaty, does not mean that Ruggie Guiding Principles would not apply, but rather it would strengthen them. Of course even during the negotiations States will want to show their advances so far through implementation of Ruggy Principles. Once a treaty were to be adopted, States who do not wish to ratify could still follow the Ruggy Principles, which may become a more attractive alternative option. Having a binding treaty will mean that constant encouragement will be there for States to join and provide clear mechanisms of accountability when human rights violations are perpetrated by Transnational Companies.

The Latin American States have indeed surprised us, with Members such as Argentina and Guatemala not providing their support to the prospect of a binding instrument.

On the other side, States such as Cuba, Namibia, Pakistan and Brazil are supporting Ecuador, arguing that the two resolutions are complementary and that the existing Guiding Principles on Business and Human Rights are not enough to limit human rights violations, mainly because they are not binding.

Towards a Corporate Social Accountability

WILPF and the majority of civil society representatives at this session are very clearly supporting Ecuador’s initiative.

As you can see from this statement written by WILPF USA and WILPF Nigeria, TNCs are responsible for grave human rights abuses with no clear mechanism to ensure accountability. They take advantage of cheap labour of female workers, who are typically childless, single, uneducated, unskilled and thus seen as easier to control and less likely to demand labour rights.

Further, the unregulated exploitation of land and resources causes communities dependent on their land to be displaced. WILPF Nigeria has highlighted the example of Delta Niger, where women have been forced to leave their lands and have become sex workers as a last resort, solicited by TNC staff and military personnel.

This case was a particularly relevant topic during the last informal discussion, where several delegations pushed for the inclusion of “other businesses” in the title of the resolution. This means that private military and security companies (PMSCs) should also be regulated in this possible new instrument as they also commit human rights violations, especially sexual violence against women.

Ensuring accountability for human rights violations in peace-keeping operations is an issue that WILPF has been trying to get on the agenda for a while, so we are glad that some Member States have raised the importance of this issue.

Have a look at our Paths to Justice project to learn more!

At this point, it is difficult to predict what will happen as several Member States have not voice their opinions during the discussions. We hope that the resolution passes and more importantly, that it actually contributes to a radical change of the policies of transnational companies.

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