Analysis: the relationship between business and human rights is now on the agenda of many key international organisations

During a recent hearing of the public inquiry into the Grenfell Tower fire, the Irish insulation manufacturing firm Kingspan was accused of being "seminally causative" in the 2017 fire which saw 72 people killed. At around the same time, a large group of states, business representatives, civil society organisations and experts were gathered at the United Nations in Geneva with a view to developing an international treaty to regulate the activities of transnational corporations and other business enterprises as they relate to human rights.

From Rana Plaza to Silicon Valley, and tax havens to open-cast coal mines, there is abundant evidence that it is not only states that can harm or deny the enjoyment of human rights. Given the unprecedented growth in size, power and reach of multinational corporations over recent decades, the relationship between business and human rights has forced its way onto the agenda of key international organisations.

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From RTÉ Radio 1's The Business, Liam Geraghty on calls for more transparency in the fashion industry since the Rana Plaza collapse in Bangladesh in 2013

The current UN efforts to develop a business and human rights treaty have been ongoing since 2014. These have been hampered by the opposition of key powerful states, often the home states of the largest multinational firms. The High Commissioner for Human Rights, Michelle Bachelet, described the treaty process as "challenging and complex", but also as "potentially crucial to the lives and livelihoods of millions of people". The considerable support for a binding instrument on business and human rights on the part of civil society organisations stands inversely to the unenthusiastic stance of business representative organisations.

Llike its European Union counterparts, Ireland has largely stood on the side-lines of the treaty negotiations, having initially voted against the resolution of the Human Rights Council resolution which set the process in train. While successive drafts of the proposed treaty have addressed key concerns raised by the EU, the strong preference of Ireland and other Global North countries is for efforts to remain focused on the implementation of the UN Guiding Principles on business and human rights, a non-binding policy framework endorsed by the Human Rights Council in 2011.

These Principles emphasise a state's duty to protect human rights, a corporate responsibility to respect human rights and the need to ensure access to remedy for victims. States are encouraged to implement the Guiding Principles through the development of national action plans, but not required to. Only around 20 states have done so thus far.

There has been little in the way of incentives or penalties for businesses that fail to incorporate respect for human rights into their operations

Ireland’s National Plan on Business and Human Rights 2017-2020 has taken a largely voluntarist approach to the question of business responsibility for human rights, by placing the emphasis on encouraging companies to respect human rights. This approach has not succeeded and the National Plan has remained relatively unknown beyond a small group of Government officials, politicians, industry groups and human rights organisations.

The eschewing of a legislative approach in the National Plan has meant that there has been little in the way of incentives or indeed penalties for businesses that fail to incorporate respect for human rights into their operations. A November 2020 report by the Centre for Social Innovation at Trinity College Dublin analysed 50 of the largest companies in Ireland, as well as the 10 biggest state-owned enterprises. It found that there remains "a long road to travel to complete fulfilment of the Guiding Principles by the selected companies" and over half the companies scored less than 20%.

On the matter of human rights due diligence, a preventive process that is at the heart of the the UN Guiding Principles, the report found that the uptake by companies was "severely lacking". The authors thus recommended in the clearest terms that the Irish Government "bring forward mandatory human rights due diligence legislation".

Due dilligence

The call for companies to exercise due diligence as to how their activities or business relationships might harm human rights echoes that which has been made by civil society organisations, parliamentarians and a growing number of companies and investors, not only in Ireland, but globally. An independent study commissioned by the Department of Foreign Affairs and Trade pursuant to the National Plan recommended legislation on human rights due diligence, given the shortcomings of the existing voluntary regime, while also stressing the need to take into account differences between large companies and SMEs.

While Ireland has not made any commitment to developing due diligence laws, the European Union recently announced legislative efforts towards human rights due diligence for companies. The Irish government is unlikely to legislate in the absence of a European directive to do so, although countries such as France have already developed such laws, thus acclimatising companies to their growing human rights responsibilities and opening up potential avenues for victims.

Ireland’s National Plan on Business and Human Rights is due for revision under the Programme for Government. It is past time that the Government moved beyond its outdated approach which stresses voluntarism, corporate social responsibility and appealing to a company’s better senses. Committing to legislation on human rights due diligence would be a valuable first step.

A business-as-usual approach inevitably rewards the powerful and perpetuates the status quo

A treaty on business and human rights will not be a silver bullet. Legislation on mandatory human rights due diligence will not guarantee a harmonious relationship between business enterprises and society at large. That relationship is complex, multi-faceted, often mutually rewarding and at times extremely harmful.

But a business-as-usual approach inevitably rewards the powerful and perpetuates the status quo. Such an approach has proven harmful to human rights on far too many occasions, and catastrophic for the environment. It also undermines Ireland’s stated commitment to human rights, which is a core foreign policy objective, which was harnessed in the successful bid to join the United Nations Security Council. Action, of course, speaks louder than words.

The views expressed here are those of the author and do not represent or reflect the views of RTÉ