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Business and Human Rights Guidance for Business Enterprises
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Teanga: Níl leagan Gaeilge den mhír seo ar fáil.
On 27 May 2021, to promote the newly published Human Rights guidance for businesses, the Department of Foreign Affairs joined the Trinity Centre for Social Innovation and BITCI to deliver a practical webinar for business, featuring Q&A, moderated by Mairead Keigher (Shift), with Tesco Ireland, Diageo and Fyffes.
Since 2011, the United Nations Guiding Principles on Business and Human Rights (UNGPs) have been the global standard for corporate responsibility to respect human rights and a key component of many responsible business standards and legislation.
Ireland is committed to implementing the UNGPs and the National Plan on Business and Human Rights 2017-2020 sets out a series of commitments to begin this implementation process.
The development of a toolkit for businesses is one of the commitments in that Plan. The Implementation Group for the National Plan on Business and Human Rights has decided that there is already a lot of expert guidance available, including in the form of toolkits, and this guidance material seeks to draw together in one place much of that expertise to help business enterprises to understand and begin implementing the UN Guiding Principles on Business and Human Rights.
At European Union (EU) level, the Commission has indicated that in 2021 it will bring forward a sustainable corporate governance proposal to enhance the EU regulatory framework on company law and corporate governance, requiring business enterprises to identify and mitigate environmental, social and human rights risks across their value chains.
The UN Guiding Principles ask businesses to take adequate measures to identify, prevent, mitigate and account for how they address their impacts on the human rights of people. They assert that when a negative impact does occur, businesses must address that impact and provide remedy, where necessary.
Business and Human Rights Guidance for Business Enterprises
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Under the UNGPs, at a very practical level, all businesses are expected to:
1. Develop a public commitment to respect human rights, and embed it across the organisation
i) Commit to respect human rights
ii) Embed human rights policy in the company’s culture
2. Establish an on-going process of human rights due diligence, that begins with the identification and prioritisation of their most severe – or salient – human rights issues (i.e. ways that the business can negatively impact on people across a business’ operations or value chain)
i) Identify potential and actual human rights impacts
ii) Act upon the findings
iii) Track the company’s performance on preventing and mitigating impacts
iv) Communicate the company’s efforts
3. Implement grievance mechanisms through which people can flag issues or complaints, and provide remedy when harm occurs.
i) Establish operational-level grievance mechanisms
ii) Provide for or cooperate in remediation
Business and human rights is an increasingly important consideration for businesses of all sizes. With major changes on the horizon, particularly at EU level, now is the time for businesses to consider future-proofing their operations, identifying and mitigating risks to people that occur in their operations and value chains, and which can also represent financial and legal risks for the businesses.
Since 2011, the United Nations Guiding Principles on Business and Human Rights (UNGPs) have been the global standard for responsible business conduct. The UNGPs consist of 31 principles across three pillars. The three pillars are: The State Duty to Protect Human Rights; The Corporate Responsibility to Respect Human Rights; and The Need for Victims of Harm to Receive Remedy. The UNGPs have formed the foundations of many responsible business standards and legislation since then.
These Guiding Principles apply to all States and to all business enterprises, both transnational and others, regardless of their size, sector, location, ownership and structure. On the question of whether the responsibilities of small and mid-size enterprises differ from those of big transnational ones – the UN’s FAQs on the UNGPs on Business and Human Rights states:
…the responsibility to respect human rights is a baseline expectation for all companies, regardless of size, operating context, sector or industry. It should not be assumed that a smaller company necessarily has less potential or actual impact on human rights than a larger entity. However, a company’s size will often influence the kinds of approaches it takes to meet its responsibility. Larger companies will likely be engaged in a wider range of activities, and have more business relationships and longer and more complex supply chains than small companies. Large companies are also likely to have more complex procedures and systems in place for decision-making, and communications, control and oversight. Thus, the policies and processes that large companies need in order to ensure that they both know and show that they respect human rights will have to reflect all these factors. In most cases, large companies will need more formal and comprehensive systems in place to effectively integrate respect for human rights throughout their operations and activities. Smaller companies may have less formal modes of communication, fewer employees and less formal management structures. Internal systems and oversight may therefore also be less formalized and complex. However, while a company with few employees may often not need very comprehensive systems, size should never be the determining factor for the nature and scale of the processes necessary to address human rights risk—this should always be guided by the risk that the company’s operations, products, services and business relationship pose to human rights.
The UNGPs envisage that states will employ a ‘smart mix of measures’ to enable an environment for responsible business conduct. As part of this, some states have introduced (e.g. France), or proposed (e.g. Germany, Finland) new laws requiring businesses to conduct human rights due diligence with regard to their supply chains.
At EU level, the Commission has indicated that in 2021 it will bring forward a sustainable corporate governance proposal to enhance the EU regulatory framework on company law and corporate governance, requiring business enterprises to identify and mitigate environmental, social and human rights risks across their value chains. The EU Justice Commissioner has indicated that these new measures will also encompass Directors’ duties, requiring business enterprises to take greater account of their long-term interests and to frame decisions in terms of environmental, social and human impacts.
The new EU Action Plan on Human Rights and Democracy 2020-2024 contains a suite of measures in the policy area of Business and Human Rights. These include a commitment to work on a comprehensive EU framework for the implementation of the Guiding Principles in order to enhance coordination and coherence of actions at EU level; and a commitment to engage with the business sector on best practices on responsible business conduct, corporate social responsibility, due diligence, accountability and access to remedies in a participative manner (e.g. supply chains, zero tolerance for child labour).
The UNGPs have been integrated into the OECD’s Guidelines for Multinational Enterprises, the global standard on responsible business conduct.
Finally, June 2021 marks a decade since the adoption of the UNGPs, an anniversary which will be marked with proposals for a new roadmap for implementation by the UN Working Group on the issue of human rights and transnational corporations and other business enterprises.
Ireland is committed to implementing the UN Guiding Principles on Business and Human Rights and our first National Plan on Business and Human Rights 2017-2020 sets out a series of commitments to begin implementing the UNGPs. Implementation of the whole of government plan is overseen by an independently chaired Implementation Group, comprising representatives of government, civil society and business. The Government’s Interdepartmental Committee on Human Rights also monitors implementation. The National Plan reflects the three pillars of the UN Guiding Principles:
- The State duty to protect: How can the State exercise its duty of protecting human rights from influences of third parties (including companies)?
- Corporate responsibility to respect: How can companies exercise their responsibility to respect human rights?
- Access to remedy: In cases of negative impacts on human rights, access to remedy is crucial for those concerned.
National Plan on Business and Human Rights 2017-2020
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The UN Guiding Principles ask businesses to take adequate measures to prevent or avoid negatively impacting on human rights of people. However, they also assert that when a negative impact does occur, businesses must address that impact and provide remedy, where necessary.
At a very practical level, all businesses are expected to:
1. Develop a public commitment to respect human rights, and embed it across the organisation
i) Commit to respect human rights
ii) Embed human rights policy in the company’s culture
2. Establish an on-going process of human rights due diligence, that begins with the identification and prioritisation of their most severe – or salient – human rights issues (i.e. those human rights that are at risk of the most severe negative impact across a business’ operations and value chain). The human rights due diligence process involves the following steps:
i) Identify potential and actual salient human rights impacts
ii) Act upon the findings
iii) Track the company’s performance on preventing and mitigating impacts
iv) Communicate the company’s efforts (internally and externally)
3. Implement grievance mechanisms through which people can flag issues or complaints, and provide remedy when harm occurs.
i) Establish operational-level grievance mechanisms
ii) Provide for or cooperate in remediation
Read more about the relationship between business and human rights
A number of useful resources have been developed to help to guide businesses through the steps required to meet their obligations under the UN Guiding Principles and business enterprises are encouraged to make use of these resources.
We have grouped the resources according to their purposes and how you would use them; for example:
- the ‘International Organisation guidance’ section contains links to documents that provide the high-level context on the UNGPs
- he Practical business-facing guidance’ sections contains links to a range of documents that help businesses get started on managing and reporting on their human rights impacts
- the ‘Benchmarks for Businesses’ section provides background information on a range of benchmarks and assessments of companies’ human rights practice
Read more about resources for businesses
Read about selected key themes
Read about related initiatives
Both the CHRB 2020 Results and the TCD snapshot of large business enterprises operating in Ireland identify business enterprises which, based on the methodology employed, have policies and public commitments to respect human rights, conduct human rights due diligence, implement grievance mechanisms and provide for remediation where necessary, consistent with their responsibilities under the United Nations Guiding Principles on Business and Human Rights.
Though such benchmarks cannot predict actual performance and outcomes for people, they nevertheless provide an insight into how business enterprises are addressing and mitigating risks to people in their own activities and operations, through their products and services, and in their business relationships.
Four business enterprises, which have been identified in these studies as having relatively stronger commitments and processes in place, have kindly provided information for case studies to assist other business enterprises in beginning the process of implementing the UNGPs on Business and Human Rights. It is intended that this section will be expanded over time (please note that several of the publications listed under ‘resources for businesses’ also contain case studies).